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Ah, the netbook: the pet rock of the PC industry. As recent moves by Acer and Google (NSDQ: GOOG) show, it’s high time to bury the netbook a…

Cheap Sprint Netbook

Ah, the netbook: the pet rock of the PC industry. As recent moves by Acer and Google (NSDQ: GOOG) show, it’s high time to bury the netbook as a fad born out of desperation rather than a true evolution of mobile computing.

Just a few years ago as PC companies confronted the abyss of the world’s worst recession since the 1920s, they realized they needed lower-priced products to avoid having sales plummet along with the stock market. They also noticed the same trend that many of us have toward mobility, with factors like weight and battery life becoming as important if not more to consumers as processing power and large screens. Thus was born the netbook: a slimmed down notebook PC running Windows XP or Windows 7 Starter with a cramped keyboard and a smaller screen, generally between 7 inches and 10 inches available for around $299 or $399.

For a while, it seemed netbooks could be a bridge to a mobile future, especially when combined with supports from wireless carriers like Verizon and AT&T (NYSE: T). But then came the iPad, which made it clear that demand for screens larger than a smartphone was going to be fulfilled by devices born of the new era of mobile. This is what Steve Jobs is talking about when he talks of a “post-PC era,” that the legacy technologies of the PC era simply can’t be crammed into smaller packages.

Ever since, netbook sales have been stagnating, even falling. And two developments this week allow us to start putting nails in the coffin. Acer, which recently dumped its CEO amid exposure to falling netbook sales, released pricing information for its new Android tablet and told investors in Taiwan that “we may not be able to get back to the golden days, as notebook plus netbook may be only able to maintain single-digit growth compared to 20 to 30 percent in the past,” according to Bloomberg. This week code surfaced that Google is also readying tablet-friendly features for Chrome OS, once pitched as an ideal Netbook companion but now increasingly labeled as a “notebook” operating system on Google’s Chrome OS product page.

There’s just not room in the computing world for a device that is a compromise in every single way except price. Smaller screens and less-than-optimal keyboards make netbooks harder to use for work and play. Windows simply wasn’t meant to run on devices that last for eight hours without huge and heavy extended batteries. The margins on netbooks are terrible.

Google has a shot at correcting many of these objections by tackling the netbook in a truly new way, but it may not matter if the world decides that the form factor is destined for a niche role. Imagine the holiday shopper in November 2011 considering their computing options: why pick the netbook? Tablets offer a more intuitive user experience at similar prices, cheap but full-sized notebooks won’t cost all that much more than the netbook (Best Buy’s Web site currently offers 70 laptops less than $600, more than any other category), and given that hardware vendors simply aren’t motivated anymore to invest in netbooks given their low margins and the emergence of the tablet in the consumer mindset, there’s not likely to be a lot of new and different things on store shelves.

Google’s hope is that corporations embrace Chrome OS netbooks as a more secure-and-reliable low-cost option for their workers, but that has always seemed like more of a sales pitch from Google than true demand that Google is poised to capture. Acer initially said upon the departure of CEO Gianfranco Lanci that it would invest “cautiously” in the mobile market, but just a week later Wang appears to have thrown caution to the wind, saying that Acer now has an “aggressive” plan to go after the tablet market.

Every industry has its fads. Google will likely try to revive interest in Netbooks when Chrome OS is finally ready, and a more sophisticated version of the CR-48 prototype Netbook could turn a few heads. But more and more, it seems like the mobile world has moved on, which could accelerate internal tension between Android and Chrome OS inside Google.

  1. While tensions are inevitable between the two products, I think you’ll see Android targeted at individuals (consumers and small business) and a Chrome tablet targeted to corporations (med to large businesses). The difference comes down to device management. Android doesn’t offer any way to remote administer software and settings on the device while Chrome obviates the need.

    Example: Hospital: Any nurse would be able to grab any Chrome tablet, authenticate, and start working. Android tablets are tied to the user, allowing them to customize it how ever they like. This doesn’t mean Android couldn’t add the necessary features for administration, it’s just that Chrome offers it today.

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  2. What is becoming more outdated than the notebook and netbook (de-facto standards for hardware form-factors) isthe ‘fixed’ thinking that computing devices must conform to a limited number of types. The relatively static world of computing devices is giving way to Cloud 4G enabled devices: the hardware components needed are more flexible because much of the storage and processing is replaced by hosted applications and broadband connectivity.

    Why not an ICT World that defines devices more by fit to the user and applications? The trend is already heading in that direction: First the environment is being defined by ‘screens’ rather than hardware boxes. Second, different groups of users at different times or modes of use (home, work desk, automobile, personal mobility) can make corresponding different choices in devices. Some of these can be made to dock or wirelessly connect to transfer screen view and functions such as keyboards and high bandwidth local networking.

    The trend to more flexible devices is shown in Motorola’s Xoom. This trend will soon bust open the hardware-restricted box mentality with innovations driven by productivity and choice.

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  3. Tablets are von Neumann machines. Netbooks are von Neumann machines. The form factors are almost irrelevant. The issue is SOFTWARE EFFICIENCY but the media is not making a big deal about that.

    I have used android on a myTouch 4G. The performance is impressive for a 1GHz processor. Why aren’t 2.5 GHZ quad-cores as fast as greased lightning? Is it because so called operating systems like Vista take up almost 10 gigabytes of disk space. They don’t care about efficiency in desktops but the MUST have it in smartphones.

    The media is making a big deal of the wrong issue.

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    1. It has nothing (very little) to do with efficiency of the software at this point. The bottleneck is still in the hardware, just in a different places for the different form factors.

      Smart devices (iOS/Android) use solid state storage which is low power, low density and fast and a 1GHz RISC processor which is low power but slow. The bottleneck is in the processor.

      PCs (MacOS/Windows) generally use hard disk storage which is extremely high capacity but very slow and really fast CISC processors which use a lot of power. The bottleneck is in the storage medium.

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  4. I have a somewhat different perspective on netbooks. I have a 10.1″ Acer AA1 running linux. Even with an Atom N270 processor, it’s quite responsive. I travel a lot by motorcycle, and the 10.1″ size is “just right.” I’m also a Google Chrome notebook tester; the Cr-48 is a little bit bigger, but still fits in my motorcycle luggage. The Cr-48, with its 12″ screen, is at the upper end of a size that I am willing to tote around. It’s got the same 10-hour battery life as an iPad, and between the long battery life and 3G cellular capability, it’s an even better traveller. I’m delighted not to be burdened with the extra weight of an optical drive on either machine. There is a place in the market for ultra-portable computers, especially if they deliver long battery life and universal connectivity. Whether Google’s Chrome OS partners can deliver a machine with the necessary hardware at a competitive price point (ideally, no more than $300 USD) remains to be seen.

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  5. I’m with Seldon – the ‘fad’ may be over, but the form-factor is still great.. I looked at the Netbook landscape quite late in the day and decided to go for a Samsung X120 instead, one of the CULV ultra-portables, but almost the same form-factor as most Netbooks.
    It’s amazing – Windows 7, Core2 Duo processor, 11.6″ 1366×768 screen, 320GB HDD, 4GB ram – it’s a full-featured laptop in a tiny Netbook body, and it’s the best travel machine I’ve ever had and far more useful than a tablet for me as it has an SD slot, 3x USB ports etc.

    You would also be surprised at how popular Atom-based Netbooks are in South Africa where tech tends to be more expensive in general

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  6. Ok, you need to start over and write your article again.

    1. Intel Netbooks came as Intel was under major threat from OLPC, who was suggesting a $100 laptop, which would have been possible if it were not for Intel having come and dumped prices on their Atom processors, and at the same time limited specs of the netbooks to try to make them cannibalize notebooks as little as possible. OLPC was no failure delivering 2.5 million laptops to children in poor countries (versus near 0 Intel netbooks to children in those same countries).

    2. Netbooks sales are growing. More than 40 million units are being sold per year. That’s over 100 thousand netbooks sold per day worldwide.

    3. Google Chrome is awesome, and will destroy Intel and Windows. As consumers will not see a difference between the ARM Powered Chrome OS and Intel Powered, ARM will obviously win that market. And consumers will rapidly understand that the Windows OS is completely useless. Especially once all the apps in Chrome run offline, cached offline, and with native code and even graphics acceleration in the Browser, which basically means Google’s and other’s free web apps will also power even the most demanding video-editing, photo-editing, document-editing, all through web apps.

    4. There is no competition to the physical keyboard when it comes to text input, to productivity. You can try all you want the fancy capacitive touch screen keyboards, swype, voice recognition, they may all be cool, but they all suck compared to using a regular keyboard. Ergo, the laptop form factor will always win.

    5. Netbook is basically a laptop. It’s Intel strategists who insisted calling those cheaper laptops another name, thus came the name netbook. Stop using that name. It sucks. It’s a laptop. Absolutely no reason to limit a laptop to 10″, limit a laptop to 160GB, no reason to prevent laptops from having HDMI output, USB3 ports, all those things Intel and Microsoft have been trying to block you from having on your $300 laptop.

    6. With ARM, the Chrome OS laptops will be $99 unlocked, unsubsidized. With Pixel Qi screens, they will run 30 hours on a battery, they will weigh about 500 grams and be extremely light, will make you wonder where the heck they put the battery so thin they will be.

    7. Might still be place for touch screens, it’s cool to scroll through a capacitive touch screen. Though that does not replace a keyboard if you care to be productive. Thus laptops may get touch screens, or tablets may get very thin keyboard add-ons that fold onto it to double as screen protectors, ergo, same thing one or the other, they are all screen/keyboard combos, ergo Laptops or Laptop/Tablet hybrids.

    8. Tablets that fit the pocket, that’s what the tablets are. Or tablets that stay at home because they can’t fit the pocket. I think the fitting of pocket ones will be by far the most popular tablets. Ergo Smartphones, but those can be up to 7″, which fits 99% of jackets inside pockets.

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  7. There’s absolutely no reason why Chrome OS needs Atom chips or other Intel chips for just running the web on it. Google needs to focus on ARM chips, and release with the help of its partners, tablets or notebook with chips like the Nvidia Tegra 3, which should be more than enough for what is essentially just a browser, and would probably give it around 15 hours of real use. Plus, Google shouldrealize that the faster Intel “dies” the faster Windows dies, too. Sure, Windows 8 will work on ARM but that will bring a whole suite of problems, including incompatibility between x86 and ARM apps. Microsoft would be way happier if they could keep their real Windows OS on x86 chips and didn’t have to move it to ARM.

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  8. I agree with most people here. The netbook will not disappear, it’s just finding a better balance in the mix. Like anything else (including tablets and smartphones), a new category is met with an overabundance of participation, and then the inevitable “balancing out” and shakeout follows.

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