

The word netbook may soon vanish into irrelevance, but the products that resulted from the category are not going away any time soon. Indeed, they're on the verge of injecting their DNA into a broad swath of the PC market.

Despite their shipments slowing down in the first quarter of 2009, inexpensive and low-powered netbooks are poised for rapid growth as their feature sets continue to mature. Research company International Data Corporation forecasts that the netbook market will more than double by the end of 2009.

"The mini notebook is doing what the notebook did," said Richard Shim, an analyst with IDC. "It went from a very targeted niche into something that appeals to a greater audience with specialized configurations.... The industry gradually changed and moved away from 'performance is king,' and now they want a more personalized experience. Now, customization is king."

Netbooks — 8- to 10-inch notebooks that typically cost between $200 and $500 — saw a boom in 2008 when manufacturers shipped 11.6 million units worldwide. Last year, netbooks were considered some of the hottest gadgets in the tech industry, with several major manufacturers including Toshiba, Dell, HP and Samsung rolling out offerings in this device category. Some analysts say the poor condition of the economy was the primary factor driving the success of netbooks.

However, netbook sales have already slowed down in 2009, and shipments are falling below manufacturers' expectations. Taiwanese manufacturer Asus, for example, expected to ship 1 million netbooks in the first quarter of 2009, according to a report in DigiTimes. But IDC's tracking indicates Asus shipped only 700,000 units that quarter.

Shim noted, however, that first-quarter numbers are generally low compared to the rest of the year for any tech manufacturer; most sales come from the holiday and back-to-school seasons. Also, companies are beginning to shift focus onto a category called "consumer ultralow-voltage notebooks" — notebooks with 12- or 13-inch screens containing the same low-powered, inexpensive guts as netbooks. These devices compensate for some of the shortcomings of netbooks — cramped keyboards and small screens — while offering impressive battery life and a light weight of about 3 pounds for a modest price range of $500 to $700. (See our review of Samsung's $550, $12-inch NC20 notebook as an example.)

If CULV notebooks are considered in the same device category as netbooks, then the netbook category is on track for massive growth. Shim clarified IDC's definition of a mini notebook: 7- to 12-inch notebooks powered by an Intel Atom processor, capable of running a full operating system such as Windows XP. IDC forecasts manufacturers will ship 26.5 million "mini notebooks" by the end of 2009, or more than double the 11.6 million units shipped in 2008. The mini notebook category has claimed roughly 17 percent of the worldwide notebook market, and IDC expects this number to remain consistent over the next few years.

Michael Gartenberg, a technology strategist at Interpret, has high expectations of these new notebooks. He explained that the more netbooks' capabilities increase, the more people will buy them. And bigger screens and full-size keyboards definitely add to capability, he said. The notebook space will get very interesting once CULV notebooks drop to $300 or $400, Gartenberg added.

One could say the netbook is "failing" if one doesn't consider a CULV notebook to be a netbook — but it's purely semantics at that point. The least that everyone can agree on is that CULV notebooks evolved from netbooks.

"We may just be beginning to see the end of the pure 'netbook' era, as vendors start bringing devices to market with 12-inch screens, full-size keyboards and larger hard drives," Gartenberg said. "The concept of the netbook is beginning to vanish as a thing itself. By the end of the year it's just going to be called a cheap PC."

At the recent All Things Digital tech conference, Microsoft CEO Steve Ballmer called netbooks "revolutionary" devices. But perhaps they would be more accurately described as evolutionary.

In addition to CULV notebooks, netbooks are inspiring other product types as well, said Brad Linder, owner of Liliputing, a blog devoted to compact notebooks. For example, some manufacturers are experimenting with the concept of the "smartbook": netbook-like devices that run smartphone operating systems such as Android. Given the little power required to run a smartphone OS, the smartbook concept could lead to even thinner notebooks than the ones we see today, as well as incredibly long battery life.

"Netbooks will probably stop being called netbooks at some point: The lines [between netbooks and notebooks] are becoming less distinct as the days go by, and there's going to be a continuum, "Linder said. "What really happened in the last year or so is [manufacturers] delivered good-enough computing at low cost. And It's what a lot of people have been waiting for."

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Photo: Jon Snyder/Wired.com