'Book Value

Notebook Value Paradox: The Hole in the Middle

Charles Moore - 2010.04.05 - Tip Jar

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Short link: http://bit.ly/9RGCkP

There's a fascinating paradox afoot in the portable computer market these days. Ergo, the two strongest sales performers are at opposite ends of the price point spectrum - inexpensive PC netbooks and ultraportable notebooks selling for as little as $199 and admittedly pricey Apple notebooks starting at $999.

According to NPD data from late 2009, the average Apple notebook selling price was US$1,419, while median Windows laptop sold for only US$519. Nevertheless Apple's $1,199 13" MacBook Pro was the best-selling notebook model overall, with three other Apple laptops finishing in the top ten. The notebook line (MacBook, Air, and Pro) exceeded 70 percent of Macintosh sales for the first time ever last year. (Note that NPD data only measures online and retail stores, not direct sales.)

Also according to NPD, at midyear 2009, nine out of ten dollars spent on computers costing $1,000 or more went to Apple, and Mac revenue market share in the "premium" price segment was 91 percent.

Meanwhile, netbooks enjoyed a 72% uptick in 2009 dollar sales over 2008, with 33.3 million units sold, while notebook sales in general rose only 5% (including netbooks), according to a report by NPD subsidiary DisplaySearch. For 2010, NPD/DisplaySearch projects the notebook PC market growing 16%, with higher than average increases for netbooks (which they call "mini-notes") and ultraportable notebooks fueled by sub-$500 ASPs.

For a graphical analysis of the global notebook/netbook market, see The Rise of Netbooks on GigaOM.

The Midrange Notebook Exodus

Beleaguered by the recession, laptop users appear to be fleeing in opposite directions - flight to quality on the one hand and to lowball prices on the other. However, this may not be as contradictory as it seems, since both polarities represent different sides of the value equation, and either can reflect perceived "best value" depending upon circumstances and needs.

Personally, I think Mac laptops provide the best value for my circumstances and needs and tastes, which is why I'm typing this on a MacBook, but I can freely acknowledge that in other contexts, a PC netbook or laptop can be a perfectly rational and sensible choice and provide good value for money spent, especially since the netbook category is one that, as Steve Jobs put it, Apple doesn't choose to serve.

I can conceive of many instances where my recommendation would be to go with a non-Apple machine, especially for folks who simply can't afford the price of entry to the Mac club, although I would also advise considering a used or refurbished Mac as a low-priced alternative.

There are times when you don't need premium quality. I consider myself frugal (some would say cheap), and if I can get some item or commodity at the dollar store that will do all I require of it, I'm delighted to shop there, and I'm satisfied that I'm getting excellent value for money spent.

I also happen to be charmed by the netbook form factor. I've so far successfully resisted buying one, but conceptually they appeal to me more than the iPad does, and it doesn't hurt that most of them are cheaper than the entry-level iPad with its minuscule 16 GB data capacity, lack of proper input support, and poverty of I/O connectivity.

We'll see.

The Primary Netbook Deficiency

The main netbook deficiency, in my estimation, is unavailability of officially kosher Mac OS X support. My daughter, a longtime Mac aficionado, recently counseled a young high-school student friend to buy a PC netbook, since that was what she could afford. Initially, my daughter was impressed with Windows 7 on the mini-note, but her enthusiasm has waned substantially with longer exposure.

She's well-equipped to evaluate, having made her living for a time doing Windows XP telephone tech-support for a Microsoft subcontractor. I suspect that a Hackintosh install (see resources below) is in the offing for that particular netbook, although she did mention having heard good reports about Puppy Linux.

How the iPad will impact this equation remains to be seen, but iPad sales will at the expense of some netbook volume.

Does the iPad represent a good value? Well, that's another movie.

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Charles Moore has been a freelance journalist since 1987 and began writing for Mac websites in May 1998. His The Road Warrior column was a regular feature on MacOpinion, and he is a news editor and columnist at Applelinks.com. If you find his articles helpful, please consider making a donation to his tip jar.

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