As Chrome OS Seeks A Niche, Google's Bet On Netbooks Is Fading

by Sam Dean - Jun. 28, 2011Comments (2)

Has anyone noticed that the hype surrounding Google's Chrome OS has slowed to a crawl? When Google first announced its intent to deliver a new kind of operating system, articles appeared left and right claiming that Chrome OS would challenge the hegemony of Microsoft and Apple, boldly capitalizing on a new cloud-centric computing model and leveraging the rise of netbooks. But some funny things happened on the way to the party. We've written before about how Google's fundamental assumption with its operating system--that users would accept a cloud-only model for working with data and applications--may have been off the mark. What's been said less is that netbooks, the fundamental hardware platform that Google was focused on, didn't last as an enduring hardware category.

According to data released by Gartner earlier this month, netbook sales have "noticably contracted" in recent months after rising stratospherically when they first arrived. Many observers put the blame on the rise of tablet devices, which are in many cases good substitutes for netbooks and the low hardware resources they include.

Meanwhile, ZDNet's Steven J. Vaughan-Nichols puts the blame on Microsoft and Intel:

"I think netbooks—small, inexpensive notebooks–are declining because Microsoft and Intel have finally succeed in weaning original equipment manufacturers (OEM)s away from Linux and low-end—with corresponding low profit margins –hardware...This was always Microsoft’s plan since they first were cold-cocked by the sudden explosion of customer interest in netbooks."

Indeed, Microsoft executives made several citations about the rise of netbooks when they were doing well, and were obviously watching the market closely. Microsoft competes with Google on many fronts, and the company had to notice how Google was focusing on netbooks as a logical platform for Chrome OS.

More than any particular type of hardware device, and beyond the might of Microsoft and Intel, though, there are some older reasons why netbooks faltered, and Google's netbook-focused operating system may be faltering with them. Since portable computers were first introduced--at least in the lighter form factors that followed the original 30-pound luggables--users have always demanded a lot of choice in portable computer form factors and configurations.

Look around you at the hardware that people tote. Some people like traditional mice, some people favor the unique pointing devices on ThinkPads, some people love the light and thin form of the MacBook Air. The bottom line is that people have always wanted more choice in their portable computers than the netbook market made room for. 

As Google moves forward with Chrome OS, the fading of the hardware market that it was banking on for the platform has to be confronted. As The VAR Guy notes, Google's positioning behind Chrome OS now "focuses heavily on the notebook term rather than netbook hype." That shift will continue, as Google tries to find the right positioning for its unusual operating system during a rapidly changing portable computing landscape.

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Chromebooks aren't netbooks.

Netbooks are cheap and painfully slow Windows 7 devices devices that have low screen resolution and a small keyboard. Like all Windows PCs they have a high maintenance overhead.

Chromebooks are Internet access appliances. They have laptop like screen resolution and keyboard, a very long battery life compared to even high end Windows and Mac laptops, and run very fast on the same hardware as high end netbooks. This is achieved by stripping out everything that isn't necessary to access the Internet to make it go faster. Most importantly, Chromebooks are zero maintenance devices - in other words all you will ever have to do to use your Chromebook, is to switch it on - there is nothing more you can do, or need to do with regard to the device itself, it just works and keeps on working, updating itself when necessary. Chromebooks are also omni-present, stateless devices which means that you can log on on one device, and then carry on on another, or on a Chrome web browser running on Windows, or Mac as if nothing happened. Also a number of people can share a Chromebook device and when they log in, their own settings and data turn up where they left off.

Netbooks (running Windows) are selling poorly and are in decline.

Chromebooks have just been put on sale to business users and schools by online order, and are not being sold in consumer retail outlets yet, and they are selling well (3rd to 5th most popular device on Amazon).

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This is a ridiculous article, the Chromebooks have not been on the market for a full month yet.

Further they will not "hit stride" until the off line versions of Google apps comes later this summer, then things will get interesting and market observations will be more realistic.

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