According to research of the Taipei-based Market Intelligence & Consulting Institute (MIC) conducted as part of the ITIS project, due to changes in end-market demand in the first quarter of 2009, shipment of 7" and 8.9" netbook PCs fell rapidly, and inventories emerged in the market. As a result, shipment volume of the Greater Chinese netbook PC industry declined in the first quarter of 2009. Shipment volume of the Greater Chinese netbook PC industry reached 4.61 million units in the first quarter of 2009, falling 11.8% sequentially. On a year-on-year basis, however, shipment grew significantly.
According to MIC Industry Analyst Ya Wei Ku, "in the fourth quarter of 2008, 8.9" models were still the mainstream in netbook PC shipment. In the first quarter of 2009, however, 10" models quickly became the market leaders. Besides small-volume shipments for specific tenders, production of 7" and 8.9" products is expected to be gradually halted in the first half of 2009. Brands including Acer are also rolling out 11.6" products, hoping to expand the original netbook PC market segment. Acer, Dell and others launched 10" products in the first quarter of 2009; production for their 8.9" products will be gradually reduced or even halted. As a result, 10" products accounted for about 70% of the Greater Chinese industry's total shipment volume in the first quarter."
Looking at the industry's main shipment destinations, since the market launch of netbook PCs, Europe has been the main market, which is due to the following factors: the two main netbook PC vendors Asus and Acer both focus on the European market, and they possess a strong understanding of local markets and have extensive experience in distribution channel operations. Furthermore, coverage of mobile broadband networks is high in Europe, and bundled promotions in cooperation with telecom operators are popular, stimulating shipment volume. Also, the ratio of the population using the Internet in Europe is higher than in other regions, and market acceptance of and demand for netbook PCs, which revolve around Internet access features, are higher than in other regions.
"However, Western Europe has been heavily affected by the global financial crisis, and starting at the end of 2008 market demand became weak", said Ms. Ku. "Furthermore, with significant changes to netbook PC specifications and with the momentum of sales promotions slowing down, the Greater Chinese industry's shipment share for Western Europe declined slightly. In North America, major operators AT&T and Verizon started to promote bundled sales of mobile broadband and netbook PCs, while the North American retail market did not decline as much as was originally forecasted. As a result, the industry's shipment share for North America increased slightly."
The Chinese market, which initially lacked interest in the small-sized netbook PCs, experienced an increase in end-market demand as the Chinese white-box market provided a stimulus for netbook PCs. Furthermore, the rural home appliance subsidy program and the issuance of 3G licenses are expected to have a positive impact on netbook PC shipments to the Chinese market.
More information can be found in the following MIC report: The Greater Chinese Netbook PC Industry, 2Q 2009
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About MIC
Market Intelligence & Consulting Institute (MIC), based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english
About ITIS
The Industry and Technology Intelligence Services (ITIS) project is managed by the Department of Industrial Technology of Taiwan's Ministry of Economic Affairs. As part of the project, research is conducted in a variety of fields, including the ICT sector. The project serves both the public and private sector.