As mini-note (netbook) shipments grow, notebook market revenue declines

AUSTIN, USA: In Q2’09, the value of the total notebook PC market was $26.4 billion, up 10% Q/Q but down 5 percent Y/Y, according to a new report by DisplaySearch -- its Q3’09 Quarterly Advanced Notebook PC Shipment and Forecast Report.

Gains in the mini-note (netbook) market were particularly strong, with revenue up both Q/Q (37 percent) and Y/Y (264 percent), as shown in Table 1. For larger notebook PCs, revenue in every category was down Y/Y, and only the portable category (those with displays from 13” to 16”) posted Q/Q growth. The strong growth of mini-notes drove their revenue share of the portable computer market to 11.7 percent in Q2’09.

Table 1: Notebook PC and Mini-Note Revenue and Growth (Millions of US$)Source: DisplaySearch Q3’09 Quarterly Advanced Notebook PC Shipment and Forecast Report

ASPs for mini-notes dropped almost 30 percent Y/Y, compared to a 10 percent decline for notebook PCs. However, mini-notes achieved substantial revenue growth due to more than 360 percent Y/Y unit growth.

Table 2: Notebook PC and Mini-Note ASP and GrowthSource: DisplaySearch Q3’09 Quarterly Advanced Notebook PC Shipment and Forecast Report

The low prices of mini-notes make these products attractive to buyers seeking a secondary PC for the home, as well as making them more affordable for first-time PC buyers in emerging markets who are less likely to require all the features available on a larger mainstream notebook PC.

The low ASPs of mini-notes are also making them attractive to telecom providers in every region. They hope to boost revenues by offering subsidized mini-notes when the customer signs a two-year data plan contract. In North America, the devices are also being offered as enhancements by cable TV providers to entice customers to sign up for a package of their services.

“Mini-notes have been a significant contributor to volume growth in the portable PC market as their very attractive price points make owning a secondary computer viable for many consumers. However, the lower ASPs of these devices are clearly having a negative impact on portable PC market revenue,” said John F. Jacobs, Director of Notebook Market Research.

“For 2009, we expect continued ASP erosion across all portable computer categories, leading to the first Y/Y decline of portable computer revenue.” DisplaySearch expects these revenue and shipment trends to continue into 2010, with mini-notes accounting for 21.5 percent of shipment volume, but just 10.9 percent of total revenue for the portable computer market in 2010.