Harvey Norman denies exiting netbook market

Australian-owned retailer Harvey Norman has denied speculation that it planned to stop selling netbook computers.

Luke Naish, general manager for computers and communications for Harvey Norman, told CRN the retailer "doesn't pay much attention to rumours".

Naish said Harvey's was one of the dominant players in the netbook market, selling a range of hardware products with wireless connections.

"We have one of the biggest ranges of netbook products and different finance options," he said.

The retailer was "extremely excited" and "bullish" about the netbook hardware category, said Naish.

"[I'm] also [excited] about the release of Windows 7 in October. I think the category's just getting started," he said.

Technology and research advisory firm, Gartner, found shipments of netbooks - or mini-notebooks - in Australia reached 14.3 percent of total mobile PC shipments, in the second quarter of 2009.

In its report on the local PC market for the second quarter of 2009, Gartner said the growth rate outperformed most of the top mature markets in Western Europe, with 97,220 mini-notebooks sold in Australia during this period.

The consumer market accounted for 90.3 percent of mini-notebook sales and telecoms service providers represented one of the fastest-growing channels for the product in Asia Pacific.

Ming Koh, co-director of independent IT retailer, PC Market told CRN he wouldn't be surprised if retailers started getting out of the netbook market.

Koh said hardware manufacturers, mobile phone service providers and telcos were all trying to take a slice of the "very small pie."

Netbooks were very popular with consumers. However retailers needed to sell "more than one netbook" to make similar "margins to a notebook", he said.

"The rebates and the margins on the product are low," he said. "I'm sticking with the category because I believe it will evolve into a higher end product."

Eric Kwon, founder of Newcastle based reseller, Tri-Benedict, said retailers were lucky if they made between $35-$50 margin on the sale of a netbook.

"There's a lot of effort that goes into selling these products," he said. "Not many users are informed about the slowness of the hardware."

Kwon said its customers signed a "disclaimer" when they purchased a netbook.

"Customers don't realise the machine was really built for basic Internet use in third world countries," he said.