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Portable Computers 2 - Us Notebook Market Surges Ahead
PORTABLE personal computers are one of the few bright spots in the recession-plagued US computer market. While sales of most types of computers have stagnated over the past year, demand for light-weight, carry-along portables is growing apace with the introduction of dozens of new 'notebook' models driving market growth.
After disappointing sales in 1990, when shortages of disk drives, flat panel displays and semiconductor chips stunted market growth, US notebook computer sales took off last year, rising to an estimated 1.4m units.
By the mid 1990s, annual US portable computer sales could rise to 6.2m units according to International Data Corporation market researchers. However, the notebook computer market is not recession-proof. Although sales volumes are growing, prices are falling precipitously.
Dozens of 'clone' makers, searching for more profitable ground as desktop personal computer prices plummet, have entered the notebook computer market offering lower-cost alternatives to the brand-name products that until recently dominated the field.
Apple Computer which entered the notebook computer market just four months ago, has already cut the US price for its low-end Powerbook notebook computer by 12 per cent.
Simultaneously , Dell Computer cut its notebook prices by about 15 per cent while slashing the price of desktop personal computers by up to 38 percent.
Other computer manufacturers are expected to follow suit, extending the industry's desktop computer price war into the portable computer segment and bringing the average price of a notebook computer down to well under Dollars 2,000.
Early market leaders in the US portable computer market have been Compaq Computer and Tandy of the US, the Zenith Data Systems division of France's Groupe Bull, and Japanese makers Toshiba and NEC.
Over the past year, however, some 40 or more computer companies launched new portable computer products in the US intensifying competition and driving down prices.
Sitting strangely on the sidelines of the notebook computer market is computer giant International Business Machines. After several failed attempts to penetrate the portable computer market IBM is expected to launch its first 'true' notebook computer later this month with an aggressively priced model that matches the performance and features of competing products.
IBM also has agreed to resell portable computers manufactured by Zenith Data Systems, a unit of Groupe Bull as part of its technology sharing pact with Bull.
IBM's entry comes as the focus of the notebook computer market is shifting from the individual purchaser to corporate buyers.
Like their desktop predecessors, notebook personal computers were first adopted by computer enthusiasts and then by those who recognised their value as a business tool. Now numerous US companies are equipping their field personnel - sales and customer service representatives - with notebook computers.
Large-volume contracts to supply these machines are coveted by all manufacturers and deep discounts on list prices are typical.
Even as the pricing patterns of the portable computer market are aligning with those of the more mature desktop arena, technology advances are creating opportunities for portable computer makers to differentiate their products and avoid the low-margin 'commodity' product trap.
Flat panel display technology, for example, is rapidly evolving to create crisper, colour, high resolution screens for portable computers. Flash memory chips are emerging as a compact and more rugged alternative to magnetic data storage technology-based disk drives.
Power management technology is another area in which computer makers find room to differentiate one notebook computer from the next.
Compaq Computer's latest offerings in the notebook computer category, for example, focus upon the pressing demand for prolonging battery life.
Compaq has developed a patented low-power backlighting system for the computer display, normally the most power-hungry element of a notebook computer. The Compaq lighting system saves up to 50 per cent of the power consumed by earlier display designs.
Semiconductor technology advances are also contributing to the effort to reduce power consumption and extend battery life. The portable computer of the future will incorporate 'wireless communications' according to many industry experts.
Among US computer manufacturers, Apple Computer is actively pursuing this trend. Last year, Apple filed a petition with the US Federal Communications Commission (FCC) that, if approved, would let computers transmit and receive information over radio waves instead of through a wired network.
Miniaturisation of the personal computer has not stopped at the 4 lb to 7 lb 'notebook' size.
A new category of personal computers that is beginning to show promise is the hand-held or pocket computer. US industry leaders in this emerging market include Hewlett-Packard and Poqet Computer.
On the horizon is yet another new type of portable computers known as slate computers. These notebook-sized devices will replace the familiar keyboard with an electronic pen. The user will simply write on the 'slate' or point to icons to select functions.
Numerous applications are envisaged for these pen-based computers among people who do much of their work while standing or moving around.
Doctors and nurses might use them to update patients' notes or order tests, for example. Software that enables the computer to interpret hand-written notes has been developed by Go Corporation, a California start-up.
Microsoft, the leading supplier of PC software, is also developing handwriting-recognition software that could be used as an extension of its existing PC operating systems. Grid Systems, one of the pioneers of the portable computer market, offers a slate computer with handwriting recognition capabilities.
IBM and Apple Computer have both expressed great interest in the potential for this new technology. Market researchers at BIS Strategic Decisions predict that sales of slate computers will top Dollars 1.5bn by 1995 and could become a Dollars 7bn market by the end of the decade.
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