Is Via Viable in the Low-Cost Notebook Market?

By Scott Ferguson  |  Posted 2008-04-09

Is Via Viable in the Low-Cost Notebook Market?

Via Technologies is looking to make some noise in the growing low-cost PC market.

When Hewlett-Packard announced its $499 Mini-Note PC for the education market April 8, it did not turn to Intel, which has been touting its line of Atom processors for these low-cost notebooks, but to Taiwan-based Via.

While Via controls less than 1 percent of the worldwide x86 market, its line of low-watt, low-cost processors seems tailor-made for a new type of notebook market that doesn't require chips with the latest and greatest clock speeds and that sell for premium prices.

For its Mini-Note PC, HP tapped Via's C7-M ultralow-volt processor, which offers a top clock speed of 1.6GHz and works within a power envelope of 3.5 watts. Earlier in 2008, Via announced a new series of chips built on new microarchitecture, called Isaiah, which is geared toward ultramobile PCs and other low-cost notebooks.

For now, Via represents a small challenge to Intel, which announced that its Atom processors for MIDs (mobile Internet devices) are ready and that new processors for what it calls "netbooks" are on the way. The Intel platform is expected to keep these notebooks between $250 and $300, which is a price range that has appeal in the education market as well as with some small businesses or companies looking for secondary laptops that employees can take on the road.

Intel estimated that this market could be worth about $10 billion, and it's determined to make a lot of noise. At this point, Advanced Micro Devices, Intel's main rival in the mainstream notebooks market, has not yet announced a specific processor with the same sort of capabilities, although it is working on several products that could make it competitive.

Although some believe the low-cost market could be huge, IDC said it believes that Intel and Via are targeting a market that will ship less than 10 million units by 2012.

Dean McCarron, an analyst with Mercury Research, said while Via cannot compete with Intel in terms of sheer volume and marketing muscle, the emerging market of low-cost PCs and ultramobile PCs plays to the company's strengths, namely low-cost chips with decent performance that do not use large amounts of power. The chips also fit well in small form factors.

A Big Chance for a Smaller Vendor?


With vendors experimenting with form factors and specifications, it's a good time for Via to enter the market just ahead of Intel's Atom line.

"Via has a track record for producing chips that meet these types of design requirements," McCarron said. "Their chips are low-power and low-cost and this is one area where Intel and Via are very much direct competitors."

With a PC vendor like HP looking to jump into the market alongside companies like Asustek Computer, which has already made a splash with its Eee PC, Via and its processors may been seen as a viable alternative while Intel ramps up production of the Atom line. (The Eee PC and Intel's Classmate PC design are still using low-volt Celeron processors.)

Later, HP could simply update the platform with Atom.

"HP has been a much more aggressive when it chooses its suppliers and in terms of taking advantage of multiple, different processors," said Nathan Brookwood, an analyst with Insight 64. "It seems HP is going to let the customers choose and that when Atom comes into a market, they will offer a version of that device and then probably keep both notebooks in the market."

The win with HP might not help Via that much in the long run.

Via has had a relation with HP and still supplies processors for its line of thin-client PCs. If other vendors enter this market-Dell seems to be the next major vendor likely to join the low-cost PC club-they might just turn to Intel. Brookwood also said he believes that since Intel's chips will come in using 2 watts or less of power and have better clock speeds, Intel has an advantage.

"What Intel had done in the past with the subnotebook market was take a processor, slow down the clock speed and limit the power consumption, and what Via offered was a [much] simpler chip that used less power than the repurposed Intel chip," Brookwood said. "What Intel has done now is use Moore's Law not to increase the capability or the performance but to shrink the overall power appetite."

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