Netbooks 'not murdering' laptop sales

By Barry Collins

Posted on 27 May 2009 at 16:46

Netbooks haven't hit full laptop sales as hard as some people have claimed, according to Intel's European's sales chief.

Christian Morales claims netbook sales were about 16% of all laptop sales globally, and a little higher in western Europe. In Britain and Italy they may account for as much as a quarter of all notebook sales, he says.

Cannibalisation currently stands at about 20%, according to Morales, which means that 20% of netbooks sold would otherwise have been sales of full notebooks.

Intel has for now cornered the fast-growing market for netbooks with its "Atom" processors. Many fear that that fast market growth may be at the expense of higher-priced laptops.

"We have seen some cannibalisation of Celeron by Atom," Morales told analysts in London. But he claims Intel's profit margins for Atom are higher than those for the much older Celeron processors.

Stacy Smith, finance chief of the world's biggest chipmaker, says laptops will be Intel's main growth driver for years to come, propelled by a continuing trend toward mobility.

Morales also claims that inventories, which had been built up by electronics makers and retailers who had underestimated the impact of the recession, were now in balance with demand. "From an inventory standpoint, we think it is really optimised for current levels of business," he says. "Supply-chain confidence is much higher."