Thanks to the rising popularity of tablets, shipments of low cost PC netbooks projected to slip to virtually zero next year.
Not so long ago, netbooks were red hot. The traditional notebook PC was losing steam and consumers gravitated toward smaller, lower cost netbook PCs with fewer features and capabilities. PC OEMs were selling tens of millions of netbooks per year.
But those days are gone, thanks to the rise of tablets. According to market research firm IHS iSuppli, shipments of netbooks are set to wind down to virtually zero afte next year.
IHS's latest compute electronics market tracker report projects that shipments of netbooks this year are set to fall to just 3.97million units this year, a 72 percent drop from 14.13 million last year. The netbook market peaked at 32.14 million shipments in 2010, according to IHS.
In 2014, IHS predicts that netbook shipments will plunge again to just 264,000 units. By 2015, shipments are projected to fall to zero.
"Netbooks shot to popularity immediately after launch because they were optimized for low cost, delivering what many consumers believed as acceptable computer performance,” said Craig Stice, senior principal analyst for compute platforms at IHS, in a statement.
According to Stice, netbooks were originally intended for light productivity tasks such as web browsing and email. But they eventually became more powerful, taking advantage of mature PC technology that enabled cost-effective implementation of more functionality. But their popularity began to descend after Apple's 2010 introduction of the the iPad, Stice said. Netbook shipments declined by 34 percent in 2011, IHS said.
"The iPad and other tablets came in a new form factor that excited consumers while also offering improved computing capabilities, leading to a massive loss of interest in netbooks,” Stice said.
Although not on the endangered species list just yet, mobile PCs have also been taking it on the chin since tablets showed up. Mobile PCs still retain the largest share of the overall PC market. In the fourth quarter of 2012, mobile PCs had about 63 percent share of the overall PC market compared to 34 percent from desktops and 3 percent for entry-level servers, according to IHS.
But IHS said mobile PCs continue to be sideswiped by the ongoing popularity of tablets. And new Ultrabooks and similar ultrathin PCs have yet to take off to the extent hoped for by manufacturers, according to the firm. Related stories: