While most of this week's security attention is focused on RSA, our coverage of products seen at HIMSS, health-care IT's biggest annual confab, continues with commanding security products for the vertical.
Our ongoing coverage of HIMSS, health care IT's biggest annual confab, continues with a look at select networking and infrastructure products on display at the show.
Here's a look at a select few of the many systems and peripherals that left an impression on opening day.
Vendors Struggle With Netbook Enigma
7:30 PM EST Tue. Feb. 17, 2009
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Yet netbooks were becoming a full-fledged phenomenon even before the stock market tanked last fall. And while it's true that economic uncertainty existed prior to last September's financial meltdown -- think the housing bubble and out-of-control gas prices -- some industry insiders think the netbook success story represents something more impactful on the high-tech industry than just temporary belt-tightening on the part of consumers.
The emergence of netbooks -- buzzworthy because of the diminutive size of both their form-factors and their price tags -- creates a potential problem for vendors in the notebook space, even as they jump on the netbook bandwagon. Netbooks are already cannibalizing sales of higher-priced notebooks, according to Microsoft, which has pointed to netbooks as a culprit for declining margins during recent calls with financial analysts.
So the question becomes: Are netbooks just a sign of the financially challenged times or do they represent a dramatic shift in what customers want from their mobile PCs?
"It's a big deal, a big change in the way the market is," said Roger Kay, president and founder of analyst firm Endpoint Technology Associates. Kay points to major strategic shifts by Microsoft and Intel as the venerable "Wintel" partnership has been forced to deal with the popularity of inexpensive netbooks, even as their sales of higher-margin products have fallen sharply in the recession.
"The value proposition for a netbook is pretty simple," Kay said. "It's basically a cheaper version of a full-blown notebook. That's easy to understand, because, hey, I've always wanted a smaller notebook, but smaller notebooks used to always cost more, not less, and all of a sudden they cost less."
Stumbling Toward A Strategy
The surprising success of netbooks, combined with the severity of the current economic downturn, has forced some of the biggest players in high tech to adjust their strategies. The cold, hard truth is that many of the strongest evangelists for netbooks -- from PC titans like Hewlett-Packard, Dell and Lenovo to components makers like Intel and Nvidia to software giant Microsoft -- would really much rather be seeing strong demand for their higher-margin products.
Customers, it seems, have different priorities and are now balking at the aggressive refresh cycles vendors are pushing. They'd rather see vendors improve existing technology than come up with new high-cost gear for them to buy.
"What we're hearing in the market right now is, 'Mend it, don't make it,' " said a source at one major components manufacturer, speaking on condition of anonymity about customers' reluctance to purchase new high-end client and server systems.
Netbooks might not be the sort of products that the big vendors and channel players want to be pushing, but having something to sell in this economy is better than having nothing, the source said.
Something may be better than nothing, but the margin pain vendors and VARs are feeling in this economy is nothing to sneeze at, said Joe Toste, vice president of marketing at Equus Computer Systems, a Minneapolis-based white-box builder.
"In the past when we introduced a new Intel part [like the Core i7], we had this big gap to sell at a higher margin, but in this economy the window is narrower," Toste said. "Hey, I want to sell more $1,000 desktops because it's a good market and there always will be some demand, but we're selling [fewer] desktops in that range because of the economy."
Enter netbooks and a chance to ease some of the pain caused by falling demand for higher-end products. Equus has teamed up with Intel to produce the first "white" touch-screen tablet netbook based on the chip maker's Classmate PC in North America.
Equus unveiled its 8.9-inch Nobi Convertible at January's Consumer Electronics Show in Las Vegas. The new unit is built on Intel's 1.6GHz Atom N270 processor and 945 GSE chipset, weighs just 2.5 pounds and is targeted at the K-8 education and specialty retail markets. The Nobi Convertible comes with a 60-GB hard drive, 1 GB of DDR2 memory, an 8.9-inch 1,024 x 600 resolution touch screen and either a 4-cell or 6-cell battery.
How bad has the recession been? Worldwide PC microprocessor unit shipments were down 17 percent in the fourth quarter of 2008 against the previous quarter and slid 11.4 percent year over year, according to research firm IDC. And if you remove Atom shipments, which saw marked growth in the fourth quarter, the numbers are even starker -- a 21.7 percent decline in worldwide PC processor shipments quarter over quarter and 21.6 percent year over year.
NEXT: The Numbers Don't Lie
