SMBs Embracing Netbooks by the Millions

SMBs are reining in IT spending, and one of the cumulative effects is the replacement or augmentation of existing desktops and notebooks with lower-cost, Web-optimized netbooks.

Computing endpoints account for the largest chunk of SMB IT-related spend, according to Techaisle, a research group.

Techaisle is forecasting that SMBs worldwide will purchase 1.1 million netbooks this year, jumping to 3.5 million units in 2010. Overall, between 22 percent and 30 percent of SMBs are looking at netbook purchases as they consider upgrading their core desktop and notebooks.

A recent survey conducted by Techaisle suggests that two factors are contributing to the SMB adoption of netbooks:

  1. Highly price-sensitive SMBs are taking advantage of lower prices sacrificing computing power, screen size and gaming ability.
  2. A new segment of mobile device buyers is entering the market, expanding the market for mobile computing devices.

“What netbook adoption among SMBs has exposed is a latent need for small, lightweight devices,” said Abhijeet Rane, partner and senior vice president, Techaisle. “This demand is being filled by netbooks and smartphones today. However, larger screen sizes are driving netbook prices up and eroding the differences between netbooks and notebooks, putting further expansion of the netbook marketplace at somewhat of a risk. For the netbook market to expand there needs to be a greater ‘value proposition differential’ – the subjective and objective differences in user experience between products.”

Techaisle also believes that while overall SMB notebook shipments are on track for a 5.4 percent growth rate, purchases of netbooks will ultimately lead to lower average selling prices and exert downward margin pressure on PC manufacturers.

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