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Prices Of Ultrabook Products To Fall in Q1 2012?

All the main Ultrabook vendors on the market are expected to lower the price of their products to below the psychological $1000 mark by the end of the year, with even deeper cuts expected thanks to a marketing subsidy by Intel worth $100 per unit.

However, whether this is sustainable for Dell, Lenovo, Acer, Asus and Toshiba remains to be seen. The high cost of components is a major barrier to any long term price reduction, with the CPU and a 128GB SSD costing between $315 and $350, around a third of the retail price of the ultrabook itself.

According to Digitimes (opens in new tab), the total bill of material of a 13-inch ultrabook amounts to nearly $700 to which an additional $250 in OEM, marketing and distribution costs have to be added.

Notebook vendors may decide to cut back on components by opting for hybrid drives, like the Seagate Momentus XT for example, or settle for the slowest Intel processor on offer to qualify for the marketing subsidy.

In what looks like an uphill struggle, the launch of Windows for ARM by the end of the year will introduce a formidable foe that can take Intel head on, bringing down the price of Ultrabook-class devices to well under $800.

Désiré has been musing and writing about technology during a career spanning four decades. He dabbled in website building and web hosting when DHTML and frames were en vogue and started writing about the impact of technology on society just before the start of the Y2K hysteria at the turn of the last millennium. Following an eight-year stint at ITProPortal.com where he discovered the joys of global tech-fests, Désiré now heads up TechRadar Pro. Previously he was a freelance technology journalist at Incisive Media, Breakthrough Publishing and Vnunet, and Business Magazine. He also launched and hosted the first Tech Radio Show on Radio Plus.