25K NETBOOKS SOLD IN JANUARY-MARCH

Durba Ghosh & Deepshikha Monga, New Delhi, April 13, 2009
The Economic Times (Delhi edition)

Sales of netbooks—the smallscreen, low-cost Internet-centric laptops—seem to be defying the slowdown. Industry estimates show that about 25,000 netbooks were sold in the first quarter of calendar year, twice the number sold in the previous quarter. The rising consumer interest in the nascent segment has led to players such as Haier jumping into the fray.

Netbooks are devices with screen size varying between below 5 inches to over 13 inches. These are priced lower than laptops, starting from Rs 13,000-14,000. With the launch of low-cost Atom processor by Intel for these devices last year, netbooks have attracted greater interest from both industry players and consumers.

“The netbook category seems to be beating initial growth estimates. These were earlier considered good gifting devices or fashion accessories. With tweaks in the screen size and more memory, these are also being adopted by enterprises for their salesforce,” Acer India chief marketing officer S Rajendran said. Companies in the pharmaceuticals, insurance and FMCG sectors have evinced interest in buying netbooks, he added.

Asus, which is among the leaders in the netbook market with its Eee PCs, is targeting different segments in India such as students, professionals, travellers and women with its products. “Asus has always valued India as one of the key emerging global economies and we foresee a great growth potential here for our products,” Asus India country head for Eee PC and notebooks business Stanley Wu said.

Chinese electronics firm Haier is now planning to launch netbooks in India in the first half of the current fiscal year. Haier India COO Pranay Dhabhai said the company is going to rely on its experience in catering to the China market, where it is the third-largest laptop brand, to garner market share in India.

But analysts say netbooks are beginning to eat into the share of notebooks. “There is some preliminary evidence of cannibalisation happening. Some large brands have seen the share of netbooks as a percentage of total laptop sales increase to as much as 20 percent, while total sales have been flat,” Gartner principal research analyst Diptarup Chakraborti said.

Electronics retailer Croma’s CEO Ajit Joshi said that netbooks are competing with entry-level laptops but the laptop market is still witnessing strong growth. About 15 percent of laptop sales at Croma stores come from netbooks.