PC industry researcher and analyst Stephen Baker has little use for netbooks. He argues they’ve nothing but weaken an industry that was already wracked by the “worst retail environment in 50 years,” fierce price pressure, a dismal 2008 holiday shopping season and the closure of the huge retailer, CircuitCity.

“I’ve been one of louder dissenters on netbooks. They’re bad for the industry and for consumers. All they’ve done is grind down price points. The [notebook] industry has cut itself off at the knees and is now about to cut itself off at the waist [with all the new netbook and low-end notebook microprocessors such as Intel’s Atom, AMD’s NEO and the ARM11.]

As NPDGroup’s vice president of analysis, Baker freely admits he cares more about his PC company clients than buyers who benefit from savage price-slashing. Indeed, Baker calculates that average selling price of a notebooks suffered a steep decline thanks in part to netbooks from $714 in March, 2008 to  $620 in March, 2009. Average selling price for netbooks in March was $319, he adds.

“That’s a pretty aggressive decline. Notebooks were selling well before netbooks showed up and have now taken billions out of the industry. Consumers never asked for netbooks,” he says.

While he sees netbooks eventually morphing into low cost entry level notebooks,  I don’t think the netbook phenomenon has begun to play out yet. Wintel netbooks which have been largely responsible for netbook success so far, but super low-cost Android-based netbooks using the ARM processor promised for the later this year will be the next shoe to drop. Coming from another direction will be   more capable Android-based mobile phones promised from giants like Motorola for later this year. And this battle of deep-pockets has staying power with Microsoft versus Google, which is Android’s biggest backer.

The good news is that entry level notebooks are shedding their image as slow and heavy. A good example of the new crop of entry level notebooks is the 3.8 pound HP Pavillion dv2 “non-netbook” just positively reviewed at pcmag.com. Still, it’s $750 pricetag is more than double that for the average netbook which is falling. That leaves netbooks with plenty of pricing headroom.

Baker believes netbooks which are increasingly being cast as “mini-notebooks” will still be around in six to nine months, but probably not in 18 months. “We’ll have to see what happens.” And it’s all good for consumers and businesses.