Boosting Tablet PC Production

As demand picks up for tablet-based personal computers, Toshiba says its
increasing production by 35 percent.

Toshiba’s Computer Systems Group said it will boost manufacturing of its
Portege 3500 Series Tablet PC notebook computer. The reason for the spike in
production is that demand is outstripping Toshiba’s supply in both the
direct and retail sales channels.

Toshiba’s Portege 3500 hit the market on November 7th and the company says
that sales exceeded expectations in November. The Toshiba tablet PC is being
marketed to executives, who are looking for a small, lightweight computing
device.

Toshiba’s tablet PC utilizes a pen input for taking digital notes and
digital ink, in tandem with Microsoft’s Journal
application, is being used by executives for note-taking in meeting, which
can be shared by sending the data over a wireless LAN.

But Toshiba is not alone in the growing tablet PC market, NEC is launching a new tablet product in early 2003. The NEC device will
utilize handwriting recognition software that works with Windows XP, as
several other vendors have introduced, as well. But the new NEC device will
be thinner, lighter and have more connectivity options than previous models.

The new NEC device was showed off at its iExpo in Tokyo last week, and is
not only thinner and lighter, than previous models from Toshiba and Compaq,
but it also has a LCD screen and supports both 802.11b and 54 Mbit/s 802.11a
wireless networking standards.

The new NEC tablet PC is expected to hit the market in late February or
early March. Besides Toshiba and NEC, Hewlett-Packard , Acer
and Fujitsu are also moving into the tablet PC market.

While Toshiba is bullish on the future of the tablet PC market, two recent
studies cast some skepticism on its potential. In November, Gartner
Dataquest predicted that tablet PC’s based on Microsoft’s Windows XP Tablet
PC edition operating system, will comprise 1 percent of global notebook
computer shipments in 2003 for a total of around 425,000 units.

IDC also recently released projections for the tablet PC market speculating
that 575,000 units will sell in the U.S. in 2003, and close to 1 million
units in 2004. The IDC study went onto say that the total US notebook
computer market will reach 13 million units in 2003, with 8 percent of sales
going to ultraportables, like the tablet PC category.

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