Sept. 30, 2002

The bulk of notebook computer shipments from Taiwan in the second quarter was models priced at US$1.000 or lower, analysts say.

The Market Intelligence Center (MIC) of Taiwan's Institute for Information Industry said that notebooks quoted at or under this level (with contract prices excluding transportation and insurance ) took 65% of total notebook shipments, up from 62,5% in the first quarter and less than 50% in the fourth quarter of 2001.

This concentration of under-1000 Dollar f.o.b. notebooks was caused by increased OEM requirements for low-price models, an official of the MIC said, noting a wave of budget notebook lines offered by Dell Computer and Toshiba this year.

Even as f.o.b. prices have already dropped dramatically, Taiwan makers could offer even more price cuts, the MIC offical said, to attract business for their vast capacities of Mainland China factories.

Also driving prices lower were cheaper notebook parts and a steady rise in orders for base-unit notebooks, which usually fetch lower prices since they do not include key components as fully assembled units do.

The MIC predicted that for the current quarter, average f.o.b. prices for these types of no-frills notebooks would drop 2.2% to US753 from US$770 in the previous quarter.

In related news, Elitegroup of Taiwan, not only a leading motherboard manufacturer but also notebook maker, offers an interesting alternative to lower prices by supplying a model without a battery pack. A considerable part of notebook computers are used by businessmen who carry them around on travels, but only use them in hotels or otherwise stationary, where mains power is supplied. Leaving out the expensive Lithium-Ion battery pack reduces the price of the final product two-fold; first by the price of the battery itself, second due to the additional space provided which allows the use of some bigger, thus cheaper, components.