The market for skinny laptops gets fat

They’re known by several different names: Ultramobile PCs, ultralow-cost PCs, low-cost ultraportable PCs, ultra-low power PCs and netbooks, among them.

No matter their title, this segment of lightweight, compact and relatively inexpensive laptops represents a small, but growing, number of PCs that is appealing to American consumers, as well as to those in countries like China, India and Japan, once thought to be the primary market for such devices.

Last fall, a Taiwanese company called Asustek came out with a 2-pound, $299 laptop with a 7-inch screen, 4-gigabyte solid-state drive and a cute name, the “Asus Eee PC.” It became a holiday hit, selling several hundred thousand of the devices at Amazon.com alone.

Until then, the types of low-cost, little notebooks in that price range were largely associated with programs like One Laptop Per Child, which seek to bring inexpensive laptops to children in developing countries.

In the United States, “for the most part, the appeal has been to gadget people buying a new toy or adults who are looking for a secondary notebook” in the 2- to 3-pound range for Internet and e-mail use, said Bob O’Donnell, vice president of IDC technology research firm.

“It’s more for people who say, ‘I want to have something smaller and lighter that I can carry with me more often than my 6-pound, 15-inch notebook,’ ” he said.

Leading PC makers HP, Dell and Acer, as well as others, are jumping into the market to get a piece of it, and chipmaker Intel is heavily pushing its small, low-power Atom processor for the new notebooks.

Acer's new Aspire one line of low-cost, low-power notebooks can fit "snugly in a backpack or tote bag," the company says.

The devices are better at handling “lite” or Web-based versions of software programs, such as productivity suites, that don’t require as much room or speed on the PC as their bigger, more powerful software siblings.

The computers generally run on the Linux or Microsoft Windows operating system. (Msnbc.com is a Microsoft-NBC Universal joint venture.) They generally don’t come with a full-size keyboard or a built-in DVD or CD drive. Most have Wi-Fi for almost-anywhere Web surfing.

Portability, gender and price
To a large degree, their appeal comes from their portability, being able to be easily placed in a backpack or even a large purse.

“There is sort of a gender story here,” said O’Donnell. “Women with smaller hands looking for a lighter device are seemingly more interested in this kind of notebook than men. Many men’s hands are larger, and the keyboards on these are difficult for them to work with. For them, they’ll likely still opt for a lighter notebook, but a bigger one.”

The $299 price point that drew attention and buyers to the ultramobile market is no more, although versions of the original EEE can be found online in the $300-plus price range.

Among Asus’ latest Eee offerings is the 2.4-pound PC 901, with an 8.9-inch screen and a 20-gigabyte solid-state disk drive. It retails for $599. Another new model, the Eee PC 1000, with a 10-inch screen and 40-gigabyte solid-state drive, is going for $699.

At that price, it matches many full-size, budget laptops that have the capacity to run standard programs.

“Consumers can spend $500 or $600 and get a low-end, full-function notebook,” said Mikako Kitagawa, lead PC analyst for Gartner Research.

The average price for a notebook at the end of the first quarter of this year was $939, a price that is expected to drop below $900 when second-quarter results are tallied, she said.

“For that amount, you can get pretty much a decent system, with a really good-size hard drive, 15-inch screen and run almost every kind of program,” Kitagawa said. “You don’t have to give up on anything.”

“The big question is if this is a sustainable market,” she said. “For it to be sustainable, the prices of these (ultraportable) devices needs to be in the $300-to-$350 range.”

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