Can AMD afford to stay out of netbooks?

AMD has no intention of trying to compete with Intel in the netbook segment, according to this story from Information Week

Tags: Advanced Micro Devices Incorporated
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By  Mark Sutton Published  November 16, 2008

AMD has no intention of trying to compete with Intel in the netbook segment, according to this story from Information Week.

The processor company has said that its new Yukon platform is intended for ultra-portables, rather than the smaller netbook form factor, and that for now, it’s not getting into the netbook sector.

I’m not sure that it’s a good move for AMD. The difference between ultra-portables and netbooks is small, and definitions change, but broadly ultra-portables have screens of between 11-13 inches and a full-size keyboard, while netbooks are generally 10 inch screens or less. That might not sound like a lot of difference, and consumers might not be able to tell the difference, but the market is still evolving, and I think that AMD shouldn’t be too hasty to distance themselves from the segment.

For one thing, the netbook sector is showing phenomenal growth. Gartner predicts that over 5.2 million netbooks will ship this year, rising to 8 million next. In a slowing market, netbooks have been the hardware success story of the year so far.

The netbook form factor is also still finding its market. While Gartner says that around 70% of netbook sales will be to consumers, the original idea of small, cheap, portable computers that would suit younger users, or second-PC owners, the netbook sector has changed up a gear, and rapidly attracted attention from business users, who like its compactness. In particular, the 'pocket-sized' netbook is more attractive than a 'full size' ultra-portable for business travellers.

The players in the netbook sector have also expanded, from the initial wave of cheaper consumer devices from Chinese and Taiwanese brands, the form factor has now attracted the big name vendors. Support from HP, Dell or Lenovo will drive sales of netbooks to more users across different sectors.

And with no AMD competition, if the big vendors wants to do netbooks, then they are going to be doing them with Intel’s Atom processor. AMD should think twice before shutting the door on a sector that hasn’t yet shown its true potential.

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