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Death of the Desktop?


Laptops gaining ground thanks to portability, price.

The desktop computer may go the way of disco dancing as more users embrace the portability of laptops and the ease of wireless communication.

The PC, introduced in the 1970s, no longer offers significant advantage in cost, memory or performance.

No desktops were listed on Amazon's (AMZN) top 10 most popular computers before Christmas - but 7 laptops were.

More users, especially young people, prefer to carry their computers with them to school, the coffee shop - anywhere. The steady growth of wireless Internet in public places also makes laptops more attractive.

The laptop may be a key element in the continued decentralization of the office. As long as the work gets done, smart bosses won't care if employees pulls on the oars at the office or from a table at Starbucks.

Battery life has long been a limiting factor to the adoption of laptops, but Hewlett-Packard (HPQ) recently announced that one of its notebook computers broke the 24-hour barrier on a single charge.

Marker researcher iSuppli says sales of laptops exceeded PCs for the first time in the third quarter of 2008, Reuters reports.

A key reason: price.

Basic laptops start at about $300. Mini notebooks, scorned by many computer gurus when introduced, are now one of the fastest growing market sectors.

The shift to laptops isn't a blip during the holidays and some analysts expect the portables to make up about 55% of computer sales in 2009.

If so, the shift will require Hewlett-Packard and Dell (DELL), which have established their reputations as PC builders, to be nimble. Existing laptops -- pitched to business users -- will have to be jazzed up to make them attractive to young buyers. Apple's (AAPL) stylish portables have a devoted following and often command a premium price.

Taiwan-based companies now grab about 80% of the laptop market, including contract manufacturers Quanta and Compal Electronics (CMPSF) and branded manufacturers Acer and Asustek.

The laptop market is segmented, ranging from low-cost notebooks to powerful devices with color displays. Hewlett-Packard has linked up with designer Vivenne Tam to produce what it calls a "digital clutch" -- a notebook designed to look like a woman's handbag.

Look for continued segmentation in processing speeds, memory, wireless capabilities and prices in an effort to make the devices attractive to a wider range of buyers. Laptops should do especially well in emerging markets where cost is often a key factor in the initial purchase of a computer.

Despite the growing popularity of laptops, gamers appear to be sticking to PCs that -- so far -- can better handle the memory-intensive software that brings video games to life.

Some users prefer the larger PC keyboard to the sometimes cramped keys of a laptop, but this won't be enough to save the desktop from going the way of disco music.
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