China's Netbook Market Faces Unique Challenges

China’s netbook market offers high margins that no PC or CE vendor wants to miss. However, the market is not as big as it first seems, due to a few factors, reports In-Stat. First, 3G network capacity for data access remains limited. Second, Intel wants to limit market development in order to protect its notebook market. The chipmaker has also launched its latest ultra-low voltage (ULV) platform, which will further overlap the netbook market space.

“Future market trends for netbooks in China remain unclear,” says Ashley Liu, In-Stat analyst. “The result may be that the netbook ends up being a transitional product.”

Netbooks are smaller laptop computers, usually with an 8 to 12-inch screen, and are designed for wireless communications and Internet access.

Recent research by In-Stat found the following:
• In-Stat estimates that TD-SCDMA subscribers will number less than five million by 2011, indicating limited space for end-device market growth.
• A total of 2.46 million netbooks will be shipped in China this year, more than half via telco channels.
• China Mobile is offering 3 levels of promotional netbook price subsidies. However, In-Stat expects operators to decrease operator subsidies over the next three years.
• Vendors including Samsung and Freescale, have introduced ARM-based solutions targeting Shanzhai (cloned) netbook vendors who have been unable to get Atom chipsets from Intel.

www.in-stat.com