Apple's iPad: Netbook Killer

The netbook never became the killer product the PC market hoped for, and thanks to the iPad, the only killing in that market now is happening to the netbook. In fact, a new study says the netbook market will be completely dead by 2015, and it's all Apple's fault.

Goodbye netbook. iPad brought you down.Goodbye netbook. iPad brought you down.

Netbooks are low powered PC laptops will small screens and keyboards that compromise on pretty much every feature to keep costs low. That gives them a low selling price, which was -- at least at first -- enough to make them sell. Unfortunately for PC makers hoping to score big in the netbook market, those compromises led to consumer disappointment and ultimately to weak sales.

Now an IHS iSupply report says the netbook market has dropped from its 2010 high of 32.14 million units shipped down to an estimated 3.97 million units shipped for all of 2013. Keep in mind that's units shipped, not units sold. In comparison, Apple sold 66 million iPads in 2012, and 22.9 million units in its first fiscal quarter for 2013.

Looking to 2014, iSupply expects netbook shipments to top out at 264,000 units, and that number drops to zero in 2015. While PC sales and shipments have been on a downward trend over the past few years, netbook sales are outpacing that drop by a significant margin, and that drop is tied to the introduction of the iPad.

"Netbooks began their descent into oblivion with the introduction in 2010 of Apple's iPad," the iSupply report said.

Part of the allure of the iPad is the fact that it doesn't feel like an underpowered compromise box, unlike the netbook. Instead of finding ways to cut corners to keep the price down while forcing on OS designed for a bigger display (that would be Windows) onto the devices, Apple chose to start with a completely different design and an operating system that caters to the platform (that would be iOS).

With Android tablets on the market now, it's a safe bet that at least a few netbook sales that otherwise would've happened are going to those tablets. That said, the iPad still commands the lion's share of tablet sales, and with the iPad mini shipping, it's eating into the 7-inch form factor market, too.

All that adds up to a big bucket of doom for the netbook market, and it was pretty easy to see that one coming. PC makers were sure consumers would be fine with "It's too slow," "I can't run some of my apps," and "The battery life sucks," because the price was low. Turns out shoppers were willing to spend a little bit more for good performance, a wide app selection, and good battery life, which sums up the iPad nicely.

The big compromise for iPad users is that they're limited to buying apps from just Apple's App Store, but that seems to be a trade off consumers are willing to make. The compromise they don't seem to want to make is quality for low price -- and that's a lesson many PC makers just can't seem to learn.

The end result is that the netbook market is now on death row and it doesn't look like a reprieve is coming. That, and the PC market now has to deal with its investment in a market that never took off, which is probably a pretty hard pill to swallow.

[Thanks to the LA Times for the heads up.]