Netbooks, smart phones: Is more convergence ahead for mobiles?

Despite Cook’s jabs, many speculate that Apple is ready to debut a competing product of its own. “We’re expecting the new iPod” for viewing photos and video and listening to audio on a much larger screen sometime later this year, Mr. Enderle says. But he doubts we’ll see a large-screen iPhone. “The iPhone is already pretty big for a phone,” he says. “It sets the top end of the size.”

Chipmaker Intel has championed what it calls a Mobile Internet Device, or MID, that would be this intermediate size. The company envisions that each device would have a specific purpose, such as entertainment or navigation, and not be an all-purpose computer. But MIDs have yet to capture much interest among manufacturers.

If Apple does come out with a mid-size “crossover” between a smart phone and computer, “it won’t be positioned as a netbook. It will be positioned as an ‘iPhone-plus’ or something like that,” says Roger Kay, a technology analyst and president of Endpoint Technologies in Wayland, Mass. “I’m sure Apple has [a prototype] in a skunk works somewhere,” he says. But whether Apple would bring the device to market is another question. “It’s a [CEO] Steve Jobs kind of decision,” he says.

Looking five years out, flexible, roll-up reading screens may answer the desire for both a small carrying size and a big screen. “We’re going to see flexible screens which will allow smart phones to grow up to similar screen sizes that netbooks have,” or even larger, Enderle says. “The screens are really close to being production-ready.”

Netbooks continue to improve in quality, with computing power equal to the laptops of five years ago and better graphics abilities. That may move them toward true laptops in both price and features, opening up even more space for a new product between a smart phone and a netbook.

In terms of price, smart phones and netbooks are already becoming competitors. The cost of materials to build an iPhone or an Asustek-brand netbook computer are nearly identical, $181 for the iPhone and $196 for the netbook, says Portelligent, which performs “tear down” analyses of electronic products.

Cellphone sales in general were down 13 percent from a year ago in the first three months of 2009, according to Strategy Analytics, a research and consulting firm. But smart-phone sales grew 4 percent during that period. Netbook sales are expected to rise 65 percent in 2009, while sales for full-size laptops will grow only 3 percent, says DisplaySearch, a market-research firm. It estimates worldwide netbook sales of 27 million this year, with sales of full laptops at 133 million.

The future will hold even more choices for consumers, analysts say. People may own a smart phone, a tablet-sized device, a netbook, Kindle-like e-book reader, a more powerful laptop, a desktop computer – or any combination of these products that fits their needs and lifestyles.

“Customers are going to get a choice of whether they want their cellphone and Internet device separate or ... one device that does both,” Enderle says.

Previous

1 | 2