AMD concerned about netbook market - PC Retail

AMD concerned about netbook market

Says entire industry is worried despite evident rush to be part of sector
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AMD has voiced serious concerns over the rise the netbook market, with the firm saying it has no plans to release an Atom-challenger because of worries that it may cannibalise sales of its more powerful processors.

"We haven't announced anything for this type of cheap mini-notebook and we're still taking this wait-and-see attitude," said Pat Moorhead, AMD's vice president of advanced marketing (pictured), speaking to PC World.

Indeed, Moorhead warned that despite the apparent rush to join the netbook market, there are serious concerns – not just at AMD, but throughout the industry – that they could significantly harm sales of more powerful and profitable processors.

"The fact that there are a number of models coming out might give the indication that [the market is] growing and everybody wants to do this, but what's interesting is you pull back the covers and talk to people in the industry and they're kind of scared.

"If you can't grow the market with this form factor, then what you're providing is a lower experience for less money, which isn't good for the consumer and isn't good for the [hardware maker], and really isn't good for the channel as well," he added.

However, the firm isn't alone. Several analysts, including those PC Retail has spoken to, have expressed concern over purchasing habits.

IDC analyst Lucie Jichova recently explained to PC Retail that the UK consumer is much more focused on price and that they are quite happy to put up with poor specifications to save money.

"The focus on price by UK consumers is a trend we've always seen; if you compare it to Germany or the Nordics, the general price of laptops has always been much lower if you look at the average selling price," she said.

However, fellow IDC analyst Richard Shim said that as price erosion continued in the mainstream market, the impact netbooks were having would diminish.

"We believe the story line of ultra-low-cost notebooks will increasingly be sidelined as the notebook market continues to offer a better solution and experience at price points similar to what ultra-low-cost notebooks are hitting," he wrote in a recent research note.

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