rajeev bajpai

Nokia's Netbook: A Big Step on the Convergence Road

the convergence started happening quite sometime back and the actual lead from the telecom companies perspective was taken by both LG and Samsung who jumped on to the netbook bandwagon about a year back and samsung is gaining advantage with couple of products.
Like the GSM and CDMA technologies in the mobile phone Nokia is in both the camps (in the camp of Intel as the netbook announced on 24th is with atom processor) and also another leg firmly in arm camp and the next announcement would happen with the arm processor. On the software side while the atom based netbook is likely to be windows 7....the arm based netbook could be with symbian or android or whatsoever....

Its an interesting space where Nokia is moving in and am sure new variants around netbook would emerge in due time threatening to someextent the monopoly of Intel and Microsoft. Whether we call the device as netbook or Smartphone would only be be a consumer choice..or may be a new name may emerge as arm based netbooks want to be called as smartbooks...

Interesting days for convergence ahead.

AMD Hopes Cheap, Light Notebooks Boost Revenues

With passing days, more capabilities and features get added to the netbooks, fuelling their acceptability much more and blurring the difference between netbooks and the notebooks - Be is the display size, be it the graphics capability (as demonstrated by Lenovo S 12) .
But with every company jumping in the fray we can only expect a better product which will continue to challange the boundries with which it was originally designed and named. AMD CEO too believes that the term Netbook will disappear in the future. Microsoft wants to call them smartbooks . This will continue with the capability enhancements of the Netbooks.

In the meantime AMD got some good news if one can call it so. After losing continously to Intel in the marketshare battle sequentially for 3 quaters out of 4 in 2008, AMD has been able to reverse the trend in first quarter of 2009, wherein Intel has suffered a decline in marketshare by 2.5 %. Intel is now down to 79.1% ( from 81.6% in Q4/2008) and AMD up by 2.3% (from 10.5 in Q4/2008 to 12.8 % in Q1/2009)

The year has perhaps started on a good note for AMD.

HP Results Show No Uptick Yet in IT Spending

HP results only reconfirm the fact that all hardware companies are sailing in the same boat. HP results only get camouflaged by the buyout of the EDS and for the last 2 quarters this is helping them to show a overall less revenue decline.

The PSG business continues to be down both in revenue and unit quantities. IPG is closely related to the fortunes in the PC business and in the difficult time people tend to print less not to forget the continous propliferation of Internet is ensuring that the consumers are taking less printouts everyday. Last year HP has been able to hold on to revenue by hiking the prices of the consumables which perhaps drove more people away from the printers. The server and storage business is at an all time low for the last 3/4 years.

HP continues to languish in the netbook sales and is much behind the likes of acer which is growing at a much faster clip. A company which prides itself in being close to the consumer owing to their dominance in the printer (consumer) business for decades missed the netbook opportunity by miles ! HP was also one of the the first PC companies to be on handheld/mobile bandwagon but they have not been able to do much on the subject either !!

EDS was/is the only saviour in the year which has gone by and perhaps this year too .

Dell, Lenovo and Acer Scramble For Relevance

Lenovo is definetly struggling in their endevour owing to their execution issues in rest of the world and the onlysaving grace for them is China. Dell has changed the strategy since their existence by embracing the two tier distribution. This should compliment their direct business and make them gain a few marketshare points in the SMB segment. However Acer continues to demonstrate their fast and better execution then both lenovo and dell which is also seen in their share price.

They have a good product portfolio. On the only growing segment in the PC industry (Netbooks) they have a commanding market share (now in excess of 30%) and by way of their continued expansion in the notebook PCs they have displaced Dell as the number 2 vendor. They have also launched smartphones post their acquisition of E ten , which is again the only growing segment in the mobile market.

Logitech: No Cause for Optimism

Deskptops gets decimated by faster adoption of notebooks - notebooks gets cannabalised by NETBOOKS. Cheaper Netbooks(oops rather value for money notebooks) put further pressure on desktops sales - so mouse and keyboard sales got to be down. So the real culprit is Netbooks..the more they sell the more revenue/profitablity comes down for the traditional PC companies and dervied demand product companies like logitech. so the company is right when he says more trouble is expected because netbooks sales is going to rise to about 15% of total PC sales from about 5% in 2008. The rate of decline of Logitech products would be in proportion to the rise in sales of mobile devices. Perhaps the product range needs to have a relook in the fast changing user preferences and a difficult economic environment.

AMD Q1: Beats Estimates, But Down Sequentially

AMD lost marketshare, the whole of 2008 to Intel. The primary reason for the fall could be attributed to Netbooks or low cost Netbooks. It is baffling to note that AMD continues to avoid the only growing market though all indications forecasts clearly points towards atleast 13-15% (35 Million) netbooks sales of the total sales of PCs which could be 260-270 Million.

Apple and Nokia: ARMed for a Netbook Fight

Another exciting product in terms of price from the arms stable and available commercially is SmartQ 5, which could strengthen Arms march into the smartphone/netbook market (are not the lines between smartphone/netbook blurring- if only by a bit-and we are yet to see the so called MIDs).

It comes with an ARM CPU and 800× 480 4.3-inch touchscreen display, 802.11b/g networking, and Bluetooth 2.0. The device runs on Linux (ubuntu) and is priced at $132 which is roughly 3 times cheaper than Nokias arm based N810 tablet (arm based)
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The Line Between Netbooks and Notebooks Is Blurring

Intel led the charge in the microprocessor market and thanks to Atom they have been able to increase their market share in 2008. One can also say that AMD lost market share because they missed the Netbook march. Netbook market is expected to grow in excess of 30 Million this year thereby at least giving companies opportunities to grow revenue even with less profit margins. Consumers seem to love it owing to its lightweight, longer battery life, and having the required functionality which one uses - not to forget the price.

Netbooks for sure will cannibalize the notebook market and is doing that. The display size is already getting bigger. from 7.0 inches to 8.9 and 10.1.....the march should continue forward. At the end of the day its not the technology limitation but the cap on the display size provided (perhaps) by Intel. Consumers will trade their choices with the features they give more weightage.

Netbooks also provided a new revenue stream for the operators and for the computer companies a new channel to sell their products to wider set of customers. Netbooks based or arm or any other processor , netbooks running on android or any other operating system would bring innovation to the industry and respite to the customers and perhaps spawn new relationships in the PC/Telecom industry.

Dell's Big Opportunity

Dell from the word go has always challanged the paradigm in the the computer Industry - by going direct and thereby changed the rules of the game on which the competitors thrived. from a technology follower it became a technology leader decimating a few of its worthy competitors. All these years they remain wedded to industry standard architecture thereby further commoditising the market. The model was a great success for 22 years but owing to changes in the consumer behaviour ( laptop adoption) the revenue suffered. They changed again by first signing up with retailers and now they have announced embracing of two tier distribution model to expand their reach.

They are extending their technological reach as well as customer reach and thereby lies their BIG OPPORTUNITY.

Millions Set to Cut Back or Terminate Wireless Service Plans

I tend to agree with the report as just another piece of information crossed me that skype is adding new users at a rate of about 10 Million per month. and in 2008 skype users spent about 33 billion minutes talking to overseas friends/customers whatever which incidentally is significantly more than the Verizon.

As the recession, job losses deepens obviously more people would love to cut down on the wasteful expenditure if they have an equally or even at times less easily available option.

The rise of the netbooks would further ensure more cheaper skype to skype communication while on the move.

Dell: Pointing Fingers, or Pointing Up?

Dell has further upped its strategy by signing up distribution agreements with Ingram Micro and Techdata. This should further enhance their penetration in the much touted SMB segment. A good strategic move which shall put more pressure on the likes of HP and Lenovo


On Feb 27 12:05 PM rajeev bajpai wrote:

> Dell in any way seems to me in a better position then HP ( minus
> EDS) as they do not have the baggage of the printers or supplies.
> They are in the business of primary product (which is client - PC
> or notebook or netbook) and hence their results would reflect the
> true state and not camouflaged by the derived demand products ( where
> bulk of profits for HP comes). for years we have been talking of
> paper less office - or whatever the fact that the unbridled growth
> of PCs led to a growth of Printers and alike products. Now the times
> have changed, consumers doesn't want to take a printout, internet
> is all pervasive. smartphones/netbooks/ sms email, internet messenger
> is getting exploited to the maximum....and then dell challanged the
> model of IT distribution - at least thats a great innovation, which
> everyone agreed - cut the middleman. and hence i feel dell is the
> best company to beat the downturn /recession and within the ambit
> of the business they will do better than HP. ofcourse the only other
> company which can change or benefit from the downturn and change
> is ACER. and in my opinion one of them will be at the top in another
> two years. HP might remain a great company like IBM but with declining
> stakes in hardware.

Synnex Earnings Preview

Last 15-16 quarters were an era of growth globally . But if Synnex delivers as per their forecast it would be amazing. It would mean that they know something about the business which other distributors like Ingram and techdata do not know and also their results would despite the gloomy about 20% down revenue forecasts from their principal vendors like HP and Intel. 26th march is going to be a interesting day !

Why My Money Is on Intel

Intel continues to make wise moves on technology or less bad moves than others. The fact remains that they continue to hold marketing prowess which resulted in having a good market share on PCs and servers over the years. In this time of slackening demand they again got themselves a winner in terms of ATOM which seems to power about 90% of the Netbooks, and lets remember that Netbooks are likely to be only growing product segment in the PC space , likely to occupy approximately 12-14% of the total PC shipments in 2009. Why AMD is choosing to ignore the segment is moot question or perhaps their response is much delayed. Its what is available on the table then 32-45 nanometers in this period of economic slowdown.

Dell: Pointing Fingers, or Pointing Up?

Dell in any way seems to me in a better position then HP ( minus EDS) as they do not have the baggage of the printers or supplies. They are in the business of primary product (which is client - PC or notebook or netbook) and hence their results would reflect the true state and not camouflaged by the derived demand products ( where bulk of profits for HP comes). for years we have been talking of paper less office - or whatever the fact that the unbridled growth of PCs led to a growth of Printers and alike products. Now the times have changed, consumers doesn't want to take a printout, internet is all pervasive. smartphones/netbooks/ sms email, internet messenger is getting exploited to the maximum....and then dell challanged the model of IT distribution - at least thats a great innovation, which everyone agreed - cut the middleman. and hence i feel dell is the best company to beat the downturn /recession and within the ambit of the business they will do better than HP. ofcourse the only other company which can change or benefit from the downturn and change is ACER. and in my opinion one of them will be at the top in another two years. HP might remain a great company like IBM but with declining stakes in hardware.

HP Succumbs, But Likely to Acquire

The only good thing is/was the EDS or the HP software which has grown by 116% . if u take out the EDS revenues and compare apple with apple then the revenues are down by more or less 16% which is no different then other hardware companies be it INtel, Cisco or any other. The forecast for the current quarter is again down (no great learning here) and it remains to be seen how much increase is coming from the HPS side over the Q1 or how much decline in the PSG or IPG business happens. This would then broadly indicate the direction in which HP or the PC market is heading, thereby the industry.