Chip shipments could face slow growth

04.11.2008

Intel's low-cost Atom processor witnessed healthy shipments in the third quarter, totaling around 5 million units, Rau said. Atom chips are targeted at netbooks, low-cost laptops designed to run basic applications for Web surfing and e-mail.

Atom shipments will continue to witness healthy growth through the economic slowdown, Rau said. Netbooks are affordable, making them attractive as primary PCs, especially in developing countries. They also can be used as secondary PCs, and some PC makers are also bundling netbooks as part of subscriptions, such as to Internet services, especially in Europe, Rau said.

Because it is new, it's too early to determine if Atom - as its own emerging market force -- will put pressure on the prices and costs of higher-end processors, Rau said. Growth for overall chip shipments will gain steam when the worldwide economy stabilizes, which should be in 2010, Rau said.

Until then consumers may find good deals on better-configured PCs, Rau said. With the memory market in the tank and possible price pressure on chips because of the economic climate, PC prices could fall. Those willing to spend cash will likely get a better deal from PC makers willing to compete for that cash.

However, consumers will still need to be able to put down money to get deals.