1Q11 NB shipment will be triggered by new Huron River platform; 2011 NB shipment growth rate is 15.4 percent under cannibalization of tablet PC

TAIWAN: Most NB ODM vendors just released their October NB shipment recently. According to DRAMeXchange, the overall Oct. NB shipment declined 5.7 percent MoM to 17.3 million.

As for the 4Q10 outlook, DRAMeXchange expects that the overall NB growth rate will be 2.1 percent QoQ and -0.4 percent YoY, scaled in 50.3 million units in 4Q10 given the healthy inventory level and rebounding European market. The 2010 overall NB shipment is expected to be 193 million units, YoY 20.8 percent.

Intel will launch new Huron River platform in 1Q11 accordingly. Compared with the dual core Calpella, Sandy Bridge CPU is migrated and improved to quad core CPU with the consistent power consumption at the level of Nehalem CPU in Calpella platform.
Also, Huron River platform enhance the performance of integrated graphic functionality. New Intel platform launch will be expected to trigger the PC replacement according to the historical pattern.

DRAMeXchange thinks that the new CPU launch will not only trigger the new demand but also will help to lower the price on old models for price promotion. Some demand in 4Q10 is believed to be delayed to 1Q11. Also, China market will account around 20 percent of total PC shares world widely and Chinese New Year plays important factor in terms of shipment.

DRAMeXchange forecasts that the 1Q11 PC shipment will decline 5-10 percent and QoQ is around -1.4 percent.Source: DRAMeXchange.

After launch in April, iPad shipment has already reached 7.5 million units by 3Q10. Other vendors will also aggressively penetrate into this market and we are carefully watching that if other vendors can compete with iPad in hardware and software manners.

Besides, Dell launched 5” and 7” tablet “Streak”, and Samsung also launched the new Galaxy Tab. HP also launched Wintel version Slate 500 and will likely deliver Web-OS platform tablet in 2011. Acer will also launch series of tablet ranged from US$299 to US$699 while Lenovo and Asus have tablet plans after that. Also, we see some mobile vendors such as RIM, Motorola and Nokia will also participate in the market.

DRAMeXchange thinks that iPad will account more than 95 percent market share given the better integration of software and hardware and total tablet PC shipment will be around 15.2 million units in 2011. The 2011 tablet shipment is expected to be 51.3 million units since more products will be ready for the market.

However, iPad is forecast to account more than 80 percent market share since most non-iPad tablet will be ready in 2H11.Source: DRAMeXchange.

DRAMeXchange thinks that 15-20 percent tablet PC will cannibalize the original NB demand. Take the total 51.3 million units shipment in 2011, tablet PC will cannibalize 7-10 million units NB demand.

Despite the new Intel CPU launch in 1Q11, 2011 overall NB growth will be around 15.4 percent YoY and 222.7 million units in scale, which is lower than historical 20 percent YoY growth pattern.

However, the overall 2010 NB shipment will be 208.2 million and will grow 31.6 percent to 274 million units in 2011 if the tablet is included.