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October 05, 2009

China's Netbook Market is Smaller than it Appears: In-Stat

By Narayan Bhat, TMCnet Contributor

Although China's netbook market offers high margins, the market is not as big as it first seems, according to high-tech market research firm In-Stat.
 
A total of 2.46 million netbooks will be shipped in China this year, more than half via telco channels, the market research firm said in its report titled “China’s Netbook Market: Not as Big as it Looks.”



 
In-Stat (News - Alert) said there are many reasons to explain the hurdles facing the market in Asia economic powerhouse. First, In-Stat said, 3G network capacity for data access remains limited. Second, Intel wants to limit market development in order to protect its notebook market.
 
 “The result, however, is intense competition between every player in the netbook value chain. Already, the x86-based platform is being threatened by ARM (News - Alert)-based platforms,” the researcher said.
 
Netbooks are smaller laptop computers, usually with an 8- to 12-inch screen, and are designed for wireless communications and Internet access.
 
According to the researcher, 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,” said Ashley Liu, In-Stat analyst, in a statement. “The result may be that the netbook ends up being a transitional product.” In-Stat estimates that TD-SCDMA subscribers will number less than five million by 2011, indicating limited space for end-device market growth.
 
China Mobile (News - Alert) is offering three levels of promotional netbook price subsidies. However, In-Stat expects operators to decrease operator subsidies over the next three years. Vendors including Samsung (News - Alert) and Freescale have introduced ARM-based solutions targeting Shanzhai netbook vendors who have been unable to get Atom chipsets from Intel.
 
In-Stat’s report also explains how netbook is being promoted by China’s wireless carriers like China Mobile, China Unicom (News - Alert) and China Telecom.

Narayan Bhat is a contributing editor for TMCnet. To read more of Narayan’s articles, please visit his columnist page.

Edited by Amy Tierney







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