PC Makes Waves with Ultrabooks

Story first appeared on WIRED
At last year’s Consumer Electronics Show in Las Vegas, you couldn’t throw your schwag bag across the show floor without hitting a 3-D television or Android tablet. This year’s hottest gadget? It looks like it will be the ultrabook.

Super thin and remarkably light, ultrabooks are expected from all the major PC manufacturers. Tablets aren’t going away by any means, but you can expect CES 2012 to be dominated by this emerging notebook category that’s being heavily pushed by Intel.

Intel, in fact, coined and trademarked ultrabook as a marketing term, using it to differentiate high-performance, ultra-portable, Intel-based notebooks from more mainstream, bottom-feeding notebooks and tablets. Apple proved to the world that this product category has legs via the success of its MacBook Air, and now Intel (and its partners) want a piece of the action too.

Intel says that to qualify as an ultrabook, a notebook must meet stringent criteria: It must weigh no more than 3.1 lbs, be no more than 0.71 inches thick, and provide five-plus hours of battery life. Even more germane to the consumer experience, it must boast flash-based storage, and incorporate Intel’s Rapid Start Technology for speedy boot times.

At CES 2012, you can expect to see 30 to 50 ultrabook models from Dell, HP, Toshiba, Acer, Asus and Lenovo, a few of which already have ultrabooks in their arsenals of shipping products. Most of next year’s ultrabooks will be in the $1,000 to $1,200 price range, and that’s a problem, according to Display Search analyst Richard Shim, who says these devices need to be priced around $699 to appeal to mainstream consumers.

“The challenge is that you’re trying to make a premium product mainstream,” Shim says. “It’s sort of an oxymoron, because as soon as it’s mainstream, it’s not premium anymore.”

Forrester analyst David Johnson says, “Apple has proven that people will pay a premium for style, but only time will tell if that magic can be applied to ultrabooks intended for Windows.”

Although ultrabooks are a response to consumer demand for more tablet-like computing experiences, they won’t be displacing the tablet at CES 2012. “I think ultrabooks and tablets will share dual billing,” Shim says of this year’s CES. “They offer kind of the same experience, so ultrabooks might be the headliner, but tablets are the next act.”

Forrester analyst David Johnson adds, “While the ultrabooks are thin, light and offer instant-on convenience, the tablet will still have a place in the computer bag for reading, reviewing documents, and informal discussions or presentations.”

As far as specs and features announced at next week’s CES, don’t expect any huge changes from the ultrabooks we’ve already seen. Your average ultrabook will have a 14-inch screen, Intel Core i5 processor, and between 128GB and 256GB of SSD storage.

“At this stage, it’s still hardware design and price competition. Who can get thinner, lighter,” Shim says. So, while we probably won’t see any one-pound ultrabooks this year, there are other ways an ultrabook might distinguish itself from the competition.

Manufacturers could use more “exotic case materials and innovative designs,” Johnson says. Samsung’s Series 9, for example, is made of Duralumin alloy, a material that is also used in aircraft manufacture. Battery life, display quality and screen resolution are other areas that ultrabook makers can capitalize on.

Johnson hopes to see a few models built to AMD’s “Ultrathin” standards, potentially based on the company’s new Brazos platform and Radeon HD 7000 graphics. Though, of course, lacking Intel silicon, these models won’t really be dictionary-definition ultrabooks.

“Ultimately, the real value will be when you complement that with software, and Windows 8 will help with that,” Shim says.

Windows 8 won’t be shipping until mid-2012 at the earliest. This means ultrabooks won’t really begin to shine until later this year and early next year — we’re just in the “build-up phase” right now, Shim says.

Johnson says Intel’s 22nm Ivy Bridge processors will drive a new crop of Ultrabooks towards the middle of 2012. We could also see “retina”-quality displays up to 2880×1800 resolution arriving toward the end of the year. Other updates to expect: higher-capacity Lithium-Polymer batteries and ever larger SSD capacities becoming available as new models are released.

What about desktops and high-performance notebooks in 2012?

“There will always be a segment of the audience looking for higher performance systems,” Shim says. “Just like with cars, there’s guys looking for muscle machines and hot rods.”

Computer Shopping Guide

The Pointer Online

As the digital divide continues to shrink in America, the need for a reliable computer is becoming impossible to ignore.  Heading full throttle into the busiest shopping time of the year, low computer prices and expanding technology promise to make this the most convenient, and confusing, holiday season yet.  

A new electronic device called the netbook has joined the computer market and is adding yet another option to the laptop industry.  However, when choosing between these three options the most important thing to remember is not what Justin Long said on TV, but what the laptop will be used for in the future.  

With an appealing price point ranging from $180 to $500, a netbook is a small laptop-type device that is designed specifically to search the web and do other small tasks.  A netbook weighs around three to five pounds, and has a small LCD screen between 10.1 to 13 inches.  

Although similar in appearance and basic functions, netbooks lack the raw computing power of a fully functioning computer.  At their slimmed down size, netbooks lack a disc drive, utilize a single core processor and come equipped with a slimmed down operating system.  

“It is important that we say that netbooks are a supplement to a fully working computer; they’re not a replacement.  People think they’re a small computer when they are not, they are a netbook,” said Donovan Lozo, Supervisor at the Stevens Point Best Buy.

Although a netbook will surf the web and create office documents as well as their larger counterparts, more advanced tasks such as video and photo editing are going to require more computing power. 

A recent survey conducted by Square Trade Inc., analyzing failure rates of 30,000 laptops, found that netbooks fail 20% more often than laptops, and that contrary to media advertisements, Toshiba and Asus make the market’s most reliable laptops.

“I don’t think [the] failure rate is different across brands because it’s not really HP or Toshiba - they don’t make the components that they put into their computers.  They choose them put them in a plastic case and put their name on it. I tell consumers that if you’ve heard of the name brand you’re fine.  I just wouldn’t recommend a brand that you’ve never heard of,” said Lozo.  

From the commercials, consumers would be led to believe that the Mac is more powerful and reliable than a PC.  When analyzing technical specifications alone, Mac’s entry level MacBook, starting at $999, is closely comparable to a Toshiba Satellite which sells for $329 at Best Buy.

What truly separates a Mac from PCs isn’t the internal specifications.  The real difference in a Mac is their efficient operating system, said Jeremy Spriggs, deputy of Counter Intelligence (Geek Squad supervisor) at the Stevens Point Best Buy.

“The Mac OS [X Snow Leopard] is a solider operating system,” said Spriggs.

Riding on the negative reviews of Windows Vista, Apple’s stable operating system has been the theme of their current campaign against Microsoft.  In retaliation to this campaign, Microsoft rushed to release their answer to this problem with Windows 7.  New Windows 7 users are optimistic.  

“Windows Vista was a pretty hefty operating system.  Windows 7 is much lighter.  This will influence the load time for different applications.  But, no matter how reliable the software is, you have to remember that these things are mass produced,” said Spriggs.

According to Spriggs, the majority of computers they service are because of user error.  These are computers that are infected with viruses that have been downloaded onto the system by using LimeWire, BearShare and downloading emails, free wallpaper and screen savers.   

Viruses are yet another reason the Mac OS is considered superior to Microsoft.  But it isn’t the reliability of the program that makes Windows so susceptible to online predators.

“Macs are only about 7% of the market.  A virus would have to be specifically built to harm a Mac.  If their market share explodes, I guarantee you’ll see more viruses,” said Spriggs.

Depending on how it is used, a Windows based computer can be just as secure as a Mac with the addition of good anti-virus software.

Netbooks are a decent, cost- efficient option for entry-level users who just want to use the Internet.  When purchasing a netbook, remember that there are full size models around the same price.  Also keep in mind that a major benefit of a netbook over a laptop is portability.  If a computer is going to spend the majority of time sitting on a desk then maybe a full-size upgradeable laptop is the better option.  

PC’s offer a large and technologically diverse group of cheap laptops with something for everyone.  These laptops can range in price from as little as $299 to well over $11,000.  The key to picking the right model is understanding what you want the machine to do.   

Mac computers are still considered to be the ‘best.’  And OS X is a less problematic operating system than Windows Vista.  For professional grade photo and video editing, potential buyers should end their shopping adventure at the Apple Store.

But for users who aren’t media moguls, a standard PC is still a reliable and cost-efficient option.  And with the introduction of Windows 7, PC users can hopefully look forward to an easier and faster computing experience.

'Black Friday' Golden For Computer, TV Sales

LA Times

The number of items sold was up after Thanksgiving compared with last year, a report says. But customers grabbed bargains and ended up spending less on consumer electronics -- $2.7 billion, down 1.2%.

Holiday shopper Thanety Bunseam was reluctant to buy anything big this year, but a few days ago the 57-year-old factory worker could be seen resting on the curb outside a Best Buy store with his quarry: a 52-inch LCD TV and a new Sony PS3 game console.

"I got it free with the TV," he said, pointing to the PS3. "They have the game with the TV, so now I buy."

Despite tough economic times, consumers like Bunseam are shelling out money this year for big-ticket electronics such as laptop deals and flat-panel televisions.

During the week of Black Friday, a critical period for beleaguered retailers, the number of computers sold rose a whopping 63% over the previous year while LCD TV sales were up 15%, market research firm NPD said Wednesday.

But there was a downside.

The main reason for the increased sales volume was deep discounts -- so much so that overall revenue for consumer electronics was lower than last year, NPD said.

Combined sales totaled $1.2 billion for Nov. 22 through Nov. 28. That was down 1.2% for the Black Friday week in 2008.

At least that was a smaller decline than last year. In 2008, spending was down 3.4% from 2007.

"This year retailers and manufacturers knew it wasn't going to be about increasing revenue," said NPD analyst Stephen Baker. "It needed to be about getting consumers excited to shop and moving those products out of the stores." Consumers were looking for bargains and computer deals.

He expects the spending pattern for electronics to continue through the holidays.

"The overall picture is better than last year," Baker said. "But don't expect to see any sales growth, in dollars, in the industry."

Laptop computer sales were certainly aided by slashed prices. The average price tag on a laptop last year for Black Friday was $638, according to NPD. This year it was $475. That's a decline of a little more than 25%.

But there was another factor.

Both Microsoft and Apple came out with updated operating systems for computers in the last few months.

This made getting new computers or laptops, often with a faster processors and more memory, especially attractive.

"If there was the right product and the right price, consumers were very willing to go out and buy," Baker said.

"There was not a reluctance to spend, there was a reluctance to spend too much."

Shoppers were well aware that they were in the driver's seat.

"This year everything was about value," said Hovik Pogosian, a salesman at the Best Buy store in Atwater Village.

"When shoppers came in, what they wanted to know was: 'What are the best notebook deals I can get?' "

PC Makers Cultivate New Buyers in Rural China

As Posted to the Wall Street Journal

BEIJING -- As demand for personal computers remains weak across the globe, top manufacturers like Lenovo Group Ltd. and Hewlett-Packard Co. are zeroing in on one largely untapped but growing market: rural China.

The companies are aggressively expanding their sales networks in China's countryside, where over half of China's population resides and broadband access is increasing, but where the average per capita annual income is only $700, according to government statistics.

They're aided in part by a $586 billion government subsidy program designed to stimulate the nation's economy by encouraging spending in rural areas. According to the Ministry of Commerce, 414,000 PCs were sold by August under the program, which gives rural residents a 13% rebate when they purchase select products.

Though difficult to penetrate, China's countryside is "probably still the world's most promising market" in terms of the number of people "who've never owned a PC before, who would like to own a PC and who have that capability," says David Wolf, CEO of Wolf Group Asia, a Beijing-based marketing strategy firm.

Gong Xiangnan, a 24-year-old migrant worker from Mengyin county in Shandong province, says she used the rural subsidy to recently buy her first PC, a Lenovo desktop for 3,000 yuan ($439).

Ms. Gong says many residents in her town took advantage of the subsidy, buying motorcycles, televisions, and other home appliances. "In our home, we already have refrigerator, TV, a washing machine," she says.

Smaller cities and rural areas in China are tricky because incomes are still very low, towns and villages are spread far and wide in places where big electronics retailers rarely go, and users aren't as knowledgeable about PCs or brands. As a result, PC vendors are adopting some new marketing tactics.

Lenovo, which is targeting rural customers with lower-cost computers and 700 new retail stores, has begun marketing computers as high-status betrothal gifts, which by tradition should appear as generous as possible.

Beijing-based Lenovo, which sold 28% of PCs in China in the first half according to IDC, is also using slogans such as, "Buy a Lenovo PC, Be a Happy Bride."

"They like to give desktop PCs because the boxes are large," says Li Zhong, director of Lenovo's consumer business in the Beijing and Hebei region. "They deliver the computers to brides' families on trucks, which everyone can see. In these cases the bigger the box, the better."

The efforts appear to paying off. According to the Ministry of Commerce, about 40% of PCs sold under the rural subsidy program were from Lenovo. H-P represented about 1% of such sales.

Globally, PC shipments have dropped in recent quarters as spending by companies and consumers has decreased. But in China -- where about 40 million PCs are sold annually, making it the world's second largest PC market after the U.S. -- sales have continued to grow, albeit at slower rates.

In Dongguang county in China's northern Hebei province, Ma Zengyan, the owner of two local computer stores, says sales are rising as customers hear about the subsidies through ads by Lenovo and the government.

One of his stores, a full-service Lenovo showroom with a conspicuous orange exterior, has a corner dedicated to some of the 30 products tailored for rural users for 2,500 yuan to 3,500 yuan apiece.

The PCs are built to accommodate any unpredictable variations in power supply voltage, which are a frequent problem in the countryside, and are packaged with software such as inventory management for farmers.

H-P, too, has been aggressively expanding its sales network outside China's largest cities over the past several years, says Weekee Yeo, director of the company's consumer-PC business in China.

The company promotes its products by sponsoring variety shows and film screenings in small cities to entertain residents where they also display and hold demonstrations with H-P computers.

In addition, the company has dispatched flashy buses to small-city and rural elementary schools to teach children and residents about their products, and vans to rural-area markets, where villagers gather a few times per month to buy goods.

H-P's market share in China increased to 14% in the first half of this year from just 5% in 2005, according to IDC. The company now has 7,000 stores and 10,000 resale partners in China.

In the long term, analysts say the most important edge a PC vendor can have in China's smaller cities and rural areas will depend heavily on their physical proximity to customers.

"In the U.S., the infrastructure is there. Even consumers who live in small towns can take highways and drive an hour or two to the closest city to shop," says Simon Ye, analyst for research firm Gartner in Shanghai. "In China's [smaller] cities, it's rare to find a person who'd drive someplace so far to buy a computer."