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Mon, Mar 22, 2010 - 09:29 AM EDT  —  AAPL: 222.2499 (0.00, +0%)  |  NASDAQ: 2374.41 (0.00, +0%)

NPD: Consumers confused, dissatisfied with netbooks
Tuesday, June 23, 2009 - 02:00 PM EDT

MacBook now up to 2.4 GHzAccording to a new report from The NPD Group, many consumers believe netbooks have the same functionalities as notebooks.

NPD’s "Netbooks II: A Closer Look" report, found that 60% of consumers who purchased a netbook instead of a notebook thought their netbooks would have the same functionality as notebooks.

That confusion about functionality is leading to some dissatisfaction. Only 58% of consumers who bought a netbook instead of a notebook said they were very satisfied with their purchase, compared to 70% of consumers who planned on buying a netbook from the start.

Satisfaction was even harder to ascertain among 18- to 24-year-olds, one of the main demographics manufacturers were hoping to win over with the new products. Among that age group, 65% said they bought their netbooks expecting better performance, and only 27% said their netbooks performed better than expected.

One marketing aspect that has interested buyers is the portability factor. It’s been the key marketing tool for netbook manufacturers, and consumers agree that it is a great feature. Sixty percent of them said that was a main reason they bought their netbooks. However, once they got home, 60% of buyers said they never even took their netbooks out of the house.

"We need to make sure consumers are buying a PC intended for what they plan to do with it," said Stephen Baker, vice president of industry analysis at NPD, in the press release. "There is a serious risk of cannibalization in the notebook market that could cause a real threat to netbooks’ success. Retailers and manufacturers can’t put too much emphasis on PC-like capabilities and general features that could convince consumers that a netbook is a replacement for a notebook. Instead, they should be marketing mobility, portability, and the need for a companion PC to ensure consumers know what they are buying and are more satisfied with their purchases."

Nearly 600 adults from NPD’s online panel who were identified as netbook owners completed this survey between April 27 and May 4, 2009.

Source The NPD Group, Inc.

MacDailyNews Take: If only the world's average IQ were 5 points higher. It must be God's cruel joke.

This particular downturn is not creating a market of cheaper computers. That market has existed for some time and there are parts of that market that we choose not to play in.

I think when people want a product of the class that we make, over and over again people have done the price comparisons and we’re actually quite competitive. So we choose to be in certain segments of the market and we choose not to be in certain segments of the market. And the question is, is the downturn going to drive some of our customers to those lower segments of the marketplace and get to buy lesser products? And I will be surprised if that happens in large numbers. And I actually think that there are still a tremendous number of customers that we don’t have in the Windows world, or in the other 99% of the phone market we don’t have, who would like to, and can afford to, buy Apple products. So we’ll see what the ratio of those two things are, but we’re not tremendously worried.

As we look at the netbook category, that’s a nascent category. There’s as best as we can tell not a lot of them getting sold. You know, one of our entrants into that category, if you will, is the iPhone for browsing the Internet and doing e-mail and all the other things that a netbook lets you do, and being connected via the cellular net wherever you are, an iPhone is a pretty good solution for that, and it fits in your pocket. But we’ll wait and see how that nascent category evolves and we’ve got some pretty interesting ideas if it does evolve.
- Apple CEO Steve Jobs, October 21, 2008

We can't ship junk. There are thresholds we can't cross because of who we are. The difference is, we don't offer stripped-down, lousy products. - Apple CEO Steve Jobs, August 7, 2007

[Attribution: Electronista. Thanks to MacDailyNews Reader "Ottawa Mark" for the heads up.]

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Jun 23, 09 - 02:06 pm Comment from: liopaapa

MacDailyNews Take: If only the world's average IQ were 5 points higher. It must be God's cruel joke.

You said it. I understand why Steve thinks the majority of people are bozos. Because they are.

We can't ship junk. There are thresholds we can't cross because of who we are. The difference is, we don't offer stripped-down, lousy products. - Apple CEO Steve Jobs, August 7, 2007

Nothing more to be said, except that people, to this day, STILL don't get Apple. So you want a piece of crap? Buy one. But Apple won't be the one supplying it...

Jun 23, 09 - 02:18 pm Comment from: iMacBErlin

My very personal opinion is....

The iPhone, no matter wich version, is the best and smaller "netbook" in the market! wink

Jun 23, 09 - 02:21 pm Comment from: freebeer

There's nothing wrong with their intelligence. Those surveyed are jus dyslexic and read "NETbooks" as "NOTEbooks".

The advertiser sell netbooks as notebooks, just smaller, slower, and cheaper. So whose fault is it?

Jun 23, 09 - 02:27 pm Comment from: Sir Gill Bates

"If only the world's average IQ were 5 points higher. It must be God's cruel joke."

Thanks MDN - my first laugh of a lousy day.

I think the average person doesn't have much of a clue when it comes to buying any computer.

Jun 23, 09 - 02:29 pm Comment from: Atoni

If people love so called Netbooks why are they having problems?? OMG it's just like a typical PC vs Mac where PC has many problems such as Fixing and Crapware while Mac has none of that because Apple is the only company that makes both the Hardware and the Software.

Jun 23, 09 - 02:35 pm Comment from: Max

I think when Apple enters the fray, all frustration, as always will fall away.

I caught a glimpse of a Concept MacTouch / Netbook that is phenomenal. Apple PLEASE come out with this!

http://trisosceles.com/concepts.htm

Jun 23, 09 - 02:37 pm Comment from: iSteve

The iPhone is a wonderful device (just try to take mine away) but it is not a netbook. The netbook purchaser is looking for a single inexpensive computer. The iPhone (and iPod touch) require a computer in addition. Very different market.

Jun 23, 09 - 02:42 pm Comment from: jocknerd

The problem isn't with netbooks. The problem is Microsoft got involved and started to define what a netbook should be. When the first netbooks only ran Linux, the people buying them knew what they were getting. But Microsoft had to get involved, just like they do with everything else. And they basically ruined the market just as it got started.

Jun 23, 09 - 02:52 pm Comment from: ed

Sorry MDN, its not possible to move the world's average IQ 5 points, because IQ is a relative measure to your peers and 100 is always the average.

I would agree that the world is filled with stupid people. Buy a friggin' touch instead of a useless netbook.

Jun 23, 09 - 02:52 pm Comment from: mm

@jocknerd

I think you got it exactly right. I just read some poster on Cnet who said Linux on a netbook was a "non-starter". What? Linux started the whole netbook craze. This just proves again that Micro$oft is the root of all evil.

Jun 23, 09 - 02:53 pm Comment from: silverhawk

"features that could convince consumers that a netbook is a replacement for a notebook."
People want cheap, they get cheap.

Jun 23, 09 - 03:01 pm Comment from: AC

I just hate the word "netbook". It sounds stupid.

Jun 23, 09 - 03:04 pm Comment from: kenh

"Satisfaction was even harder to ascertain among 18- to 24-year-olds"

No surprise there. I am a teacher, and most things for them are hard to ascertain from about 15 to approximately 35. The funny thing is: that is the time of life when they are totally certain they know everything!

Jun 23, 09 - 03:04 pm Comment from: Not Bill

"...we’ve got some pretty interesting ideas if it does evolve."

That is such an interesting statement.

Jun 23, 09 - 03:07 pm Comment from: JoshtheiMacGuy

This is a surprise? I hope not! I have seen a few netbooks. I have also seen a few cheap VISTA computers. I would take the cheap VISTA computer over the netbook any day. Sure, it's Vista. But, for about $150 more you get 4x the capability. Netbooks are cute, light weight and different. But they flunk the value test, IMHO.

Jun 23, 09 - 03:13 pm Comment from: Gordon Horne

Goody, more percentages. tongue wink

Actually, we may be able to tease some interesting information out of these ones. If we assume "consumers who purchased a netbook instead of a notebook" in the phrase "60% of consumers who purchased a netbook instead of a notebook thought their netbooks would have the same functionality as notebooks" and "consumers who bought a netbook instead of a notebook" in the phrase "58% of consumers who bought a netbook instead of a notebook said they were very satisfied with their purchase" refer to the same block of consumers, then we can guess that 18% of "consumers who purchased a netbook instead of a notebook" overestimated their computing needs. Of course, this in turn assumes that the entirety of the 40% who knew a netbook wasn't a notebook were very satisfied with their purchase. And you know what they say about when you assume.

Jun 23, 09 - 03:29 pm Comment from: ecrabb

For the same money, I'd rather have a 2-3 year old USED notebook than a brand new netbook, regardless of operating system. Cheap build quality, tiny screen, usually light on RAM... AKA crap.

Besides, once it's too big to fit in a pocket or holster, what's the point of a tiny underpowered subnotebook with a tiny screen and low-power processor?

Jun 23, 09 - 03:35 pm Comment from: HMCIV

What's the comparison between netbooks sold and iPhone/iPod touches sold?

Jun 23, 09 - 03:40 pm Comment from: DLMeyer

You get a larger screen at a slightly higher price - than the iPhone - and you sort of expect a bit more capability. That isn't how it works. Apple doesn't really market the iPhone as a NetBook, even though they could. Not that people would believe it, but the similarities are significant.
The so-called iPhone Plus (or "Pro", or "Super", or ...) would seal the argument, with a larger screen and all. If they are going to give it the MacBook name - a replacement for the 13" model with a 10" screen - they will need to use a bigger processor (along with the larger screen and greater storage). Oh! Didn't the dual-core just get upgraded to a smaller scale and more cores? Yeah, that would do it.

Jun 23, 09 - 03:58 pm Comment from: jjjj

I recently went on a trip, and all I took was my iPod touch and a charger. I was able to do just about everything I needed to do. Web, email, telnet - all there.

(the possible need to FTP was probably the one thing I couldn't do, but I haven't studied that, yet.)

Jun 23, 09 - 04:48 pm Comment from: ken1w

> However, once they got home, 60% of buyers said they never even took their netbooks out of the house.

Typical PC user. smile Buy a cheapo computer will an inordinately small screen, cramped keyboard, and inferior performance, and then use it permanently attached a desk.

Actually, I know Mac users who do the same thing. They get a MacBook Pro because it's cool, yet they use it at home at the exact same location 99% of the time. For less money, they could have gotten an iMac with equivalent performance, much bigger screen, larger hard drive, and more comfortable ergonomics.

Jun 23, 09 - 04:53 pm Comment from: Michael

Was this report funded by Microsoft? Desperately trying to force market attention away from these low-cost, low-power systems that can't run the latest version of Windows.

The problem is, and Microsoft knows this, they can't compete on a level playing field and make any kind of a profit. Even a product that's currently perceived by the general public to be very successful, the xBox, is actually sucking their coffers dry. How many billions do you have to lose just to try and win market share?

Jun 23, 09 - 05:05 pm Comment from: RevDr

Ok so iSteve says "The iPhone is a wonderful device (just try to take mine away) but it is not a netbook. The netbook purchaser is looking for a single inexpensive computer. The iPhone (and iPod touch) require a computer in addition."

And the guy from NPD says "they should be marketing mobility, portability, and the need for a companion PC"

So iSteve, the first thing is that when some one buys a netbook, according to NPD, they will need a "companion PC", secondly, you don't need a computer for the iPhone, at all, if you don't want one. Everything that you might want to add to the phone can be gotten wirelessly. And please name the functionality that a netbook has that the iPhone does not. Seriously, I would like to know. No kidding.

Jun 23, 09 - 05:08 pm Comment from: Sir Gill Bates

@ ken1w,

" ... and more comfortable ergonomics."

Au contraire, my good man. There is nothing more ergonomically relaxing than using your laptop while kicking back in a luxurious Lazy Boy. Preferably with a cold brewski. wink

Jun 23, 09 - 05:09 pm Comment from: Predrag

..."For less money, they could have gotten an iMac"...

But that iMac would have been much bulkier. Many times, this has nothing with portability but with clunkines and bulk. An iMac would take up much more desk space than a MBP. In addition, that MBP often sits not on a desk, but on an end table/coffee table/kitchen counter.

Regardless, it was obvious to most people that netbooks were going to be bought, for the most part, as THE primary computer. Their purpose, as defined in some board room (or as it seems to make sense based on design) may have been a secondary, mobile device, but consumers apparently didn't get the memo. When buying a new PC, they asked for the cheapest one and they were given a $300 netbook. Is anyone actually surprised by such high dissatisfaction rate?

Jun 23, 09 - 05:15 pm Comment from: Predrag

..."Satisfaction was even harder to ascertain among 18- to 24-year-olds"...

I think MDN is using the word ascertain here incorrectly. It means: to determine, to find out with certainty. In other words, the sentence implies that it was difficult to find out the satisfaction level of 18- to 24-year-olds. Yet, in the following sentence, they state a very definitive, certain number of 65%, representing disappointed buyers.

The sentence would probably make more sense as follows:

"Satisfaction was even harder to attain (or achieve) among 18- to 24-year-olds"...

Jun 23, 09 - 05:20 pm Comment from: Sir Gill Bates

"Satisfaction was even harder to attain (or achieve) among 18- to 24-year-olds"

Just wait till they get past 50! confused

Jun 23, 09 - 05:43 pm Comment from: JackH

@Sir Bill Gates

ROFLMAO! :D

Jun 23, 09 - 06:00 pm Comment from: Ronin

I don't own a netbook and am not planning on buying one any time soon, if ever. But to dismiss these things while the market for them is exploding seems kind of...strange. They are expected to sell 22 million of these things this year (http://apple20.blogs.fortune.cnn.com/2009/05/04/netbook-sales-will-soar-to-22-million-in-2009-idc/). Junk or not, underpowered or not, and loaded with the aging XP operating system, that's a heck of a lot of units sold.

Jun 23, 09 - 06:45 pm Comment from: Predrag

Ronin:

Yes, indeed; but that's like selling 20 million generic MP3 players for $30 each. The profit margins on $300 netbooks are razor thin; for many there aren't any and are there as loss leaders, to encourage people to pay a bit more for a better-featured netbook.

These netbooks manufacturers (Dell, Hp, Acer) are canibalising their own notebook market, and are sucking out the little profits they were making on them. It's hard to imagine how a company that used to sell product for $600 could survive selling a similar one, addressing the same market space, for half that price. There is no way the netbooks would sell twice as many as notebooks would have.

The platform is a losing proposition with a limited life span, unless something radical happens to it and makes it more profitable for makers, and more palatable for buyers.

Jun 23, 09 - 06:56 pm Comment from: montex

@Ronin

Besides the fact that there is no profit in Netbooks, I don't believe the statistic that 22 million will be sold this year. In fact when it comes to computers, financial analysts are rarely correct.

But so what if Dell sells a lot of Netbooks? That means they make less and less profit which stunts R&D;budgets. The end result is cheaper, less dependable machines. No thanks.

I don't begrudge Apple making a profit. When Apple is profitable, Apple creates amazing products. Without the original iMac, there would not have been an iPod or later the iPhone. Profits made from one successful product are turned into better, more advanced products in the future. That just doesn't happen when you try to flood the market with cheap goods that don't make any money.

I know I'm probably paying more for Apple, but that isn't a problem for me. I get higher value in the goods I buy. I've seen a lot of PCs that look like boring, life-sucking boxes and yet a 5 year old PowerMac G5 has a design that still takes my breath away.

Long live Apple and long live Steve Jobs.

Jun 23, 09 - 10:03 pm Comment from: Chriswan

those netbooks are even better spec'ed than my PC at home; and the old PC still works fine for my 'casual users activities' like browsing, word processing, spreadsheet, casual games, listening to music

I think some people who disappointed with netbooks were having unrealistic expectations like: playing medium/heavy 3d games, opening like 20 complex/huge spreadsheet and many other processes at the same time

Jun 23, 09 - 10:44 pm Comment from: Ted

Portability... meh. If you can't fit it in your pocket, it ain't portable. if you have to lug a netbook around in a bag over your shoulder, then you may as well lug a notebook around in a bag over your shoulder.

Jun 23, 09 - 11:08 pm Comment from: Anonymous©

One, people don't know what they want, just look at those MS laptop hunter ads.

Two, the difference between a 12" netbook and a 13" laptop is marginal.

Three, I got a Dell Vostro with Ubuntu Linux for $200, and turned it into a Hackintosh, with a 32GB SSD and 2GB ram and a 16GB SDHC card. And, you know what, it works fine. I like it as much as I liked my 12" AluPB. I hate the keyboard layout, and I hate the heat, but for mobility, it's great. I use my iPhone for most things, but I prefer to use Safari on the Vostro.

I may eventually give it to one of my nephews, with smaller hands and better vision, but for its intended purpose it worked fine. I basically got it to use while my mom was in the hospital, and it was a perfect use. Battery life was good. It functioned just like a Mac should, but without the build quality. I'm thinking that I'll get that MBA with 128GB SSD, refurbed, for $1449, for the ultimate in mobility, but the Vostro was great in a pinch, and I didn't fear for it being stolen while leaving it in my mom's hospital room.

Jun 23, 09 - 11:56 pm Comment from: AppleJack

It occurred to me yesterday, when I was looking at the specs on the new iPhone, . . . it's actually more than three-times the computer than my first iMac was, except for the screen. Add to that mobile phone, Wifi, GPS, and camera capabilities, and it is much more than just that. Strangely, it cost about a thousand dollars less.

Jun 24, 09 - 12:00 am Comment from: dd

Netbooks are cool to look at. Yeah...... that's it. They're incredibly cramped and relatively underpowered.

People are dumb.™

Jun 24, 09 - 04:41 am Comment from: absentminded

The average person doesn't have much of a clue. full stop!

Jun 24, 09 - 10:21 am Comment from: Mr. Reeee

Ted. BINGO.

The difference between 2.5 or 3lbs and 5lbs is marginal when you're carrying it on your back. (Shoulder bags are TERRIBLE ergonomically, BTW.) Then factor in all the other crap that you lug with it... AC adaptor, cables, chargers, and the "I-may-need-this" stuff, etc., etc.... and what's the point?

I'll keep my 15" MBP, thanks. I'm finding my iPod touch does a fine job. It's "just enough". I can check my email and send a quick note... "got it. more later" ... to let people know I'm on the case. It's a kind of a revelation.

Luckily in NYC, finding wi-fi hotspots is easy. If i were out in the boonies, I'd probably want an iPhone... provided AT&T;had a signal way out there...

Jun 24, 09 - 11:40 am Comment from: Sarasota too

I thought MS was going to kill XP when they launch Win 7, this will be a blow to netbooks. Having "Windows" makes it sound like a notebook. Android and Pre could jump into the market to fill the gap, and expand their base. However people will know that net and note is not the same. This will help Apple when people at Best Buy stop thinking they can buy a $300.00 laptop.

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