NEW YORK -- A Morgan Stanley analyst cuts her forecast for PC sales and shipments for 2009 and 2010, citing weak demand and price-undercutting by low-cost netbooks.

In a research note today, Kathryn Huberty forecast global PC revenues would drop 24% this year, more than double her earlier estimate of a 10% drop. Shipments will fall 11%, she wrote, and ASPs will drop 15%.

She also revised her 2010 forecast to a 3% revenue drop, from flat, despite 2% shipment growth.

Netbooks, Huberty says, are cannibalizing traditional notebook sales, taking a 20% share (22 million units) in 2009. Netbook production will rise 41% to 31 million units in 2010, she said. Netbooks are typically priced at no more than half the cost of a traditional notebook.