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Low-Cost Personal Computers Expected to Gain Popularity

Date: 2008-6-6

[Abstract]
   Even though many computer makers have demonstrated their willing to address the market of ultra low-cost personal computers (ULCPCs), analysts remain skeptic about market share of such machine...

[Content] PCDigitalMobileGame

Even though many computer makers have demonstrated their willing to address the market of ultra low-cost personal computers (ULCPCs), analysts remain skeptic about market share of such machines. Nevertheless, president of Asustek Computer believes that already this year the market of low-cost systems will reach 10 million units.

During the world’s second largest technology trade-show, Computex Taipei, Jerry Shen, the president of Asustek Computer, said that the market of ULCPCs will reach ten million units this year. Those systems – both desktops and notebooks – will be based on Intel Atom processors in about 70% of cases, whereas the remaining 30% will be shared between Intel Celeron M and Via C7-M chips, reports DigiTimes web-site.

Asustek Computer itself said earlier that it plans to ship about five million Asus Eee PC-branded computers this year, which means that the company wants to command approximately 50% of the whole ULCPC market. Mr. Shen did not provide breakdown between shipments of desktop and mobile low-cost systems, but considering the large lineup of Asus Eee PC notebooks, it is highly likely that laptop computers will have the lion’s share of ULCPC space in 2008.

In order to achieve its goal, Asustek ensured Intel’s guarantee to ship a certain amount of Intel Atom processors, which will allow the world’s largest manufacturer of computer components not to suffer from tight supply of Intel’s latest mobile chips.

Earlier this year IDC market tracking firm forecasted that worldwide shipments of the ultra low cost notebook PC will grow from less than 500 thousand units in 2007 to more than 9 million in 2012. Therefore, predictions of the high-ranking executive from Asustek seem to be pretty optimistic.

IDC also claims that with low average selling prices (ASPs), worldwide mobile ULCPC revenues will be less than $3 billion in 2012. According to certain estimates, Asustek’s profit rate from its Eee PC business is between 10% and 15%, which is below usual profitability of Asus-branded devices.

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