PC Makers Bet On Wee Computers (AAPL)(INTC)(DELL)(NOK)(RIMM)

April 8, 2008 by Douglas A. McIntyre

The market for desktop PCs and notebooks gets more competitive by the day. Just ask Michael Dell of Dell (DELL). He has cut more people and plans to shut a facility in his hometown, Austin. Citizens throw rotten fruit at him in the streets. The resurrection of the Apple (AAPL)  Mac has put one more significant player in the field. With a slow economy, the pie is not growing as fast as it did for several years. It is an ugly situation.

Enter the tiny PC. Selling for as little as $300, it does not do much. It has very little storage. It does allow owners to explore the internet and use their e-mail. It works with WiFi and will probably work with WiMax, if there ever is any.

According to The Wall Street Journal "Inte (INTC), which calls the new devices "netbooks," says 10 computer makers have committed to designing 20 machines." And, why not? It seems like a virgin market.

It truth, it is one of the most crowded markets in the world. The makers of so-called "smartphones" are flooding the world with everything from Apple iPhone to more consumer-friendly RIM (RIMM) Blackberry models. Nokia (NOK) and Sony Ericsson are attack the business with a vengeance. While the average price of the handsets they sell around the world is dropping, smartphones sell for big cash.

All of these smartphones have the ability to work on the internet, watch video, play the Rolling Stones, and send e-mail. They are, in other words, direct competitors to the devices PC-makers want to put into the market.

But, they are a little late.

Douglas A. McIntyre