Fading Netbooks Mean Strategy Rethinks for Many Tech Players

by Sam Dean - Jun. 07, 2011Comments (0)

It's hard to believe that only a couple of years ago, netbooks--stripped down portable computers emphasizing online connectivity and available at rock-bottom prices--were all the rage in the tech industry. Analysts claimed that they would forever change the economics and technology profile of the portable computing industry. Google announced that its Chrome OS was focused on netbooks exclusively. Canonical tuned up a version of Ubuntu dubbed Netbook Remix. Fast-forward to today, and even though netbooks did raise big questions about the prices set on today's portable computers, they didn't change everything. That's something that Google, Canonical and other players now have to wake up to.

In a notable column on The Register, none other than Matt Asay--noted open source blogger and former COO of Canonical--has this to say about the current state of netbooks:

"Let's face it: netbooks are in decline and fading fast. Canonical getting a deal with Asus doesn't change that. Asus is spreading its bets, also dabbling in MeeGo. But this hardly matters. Netbooks were a promising new market until Apple clobbered them with the iPad. Today, netbooks, laptops, and desktops are being cannibalized by the nascent tablet market, as IDC reports."

Not only did netbooks get clobbered by the iPad, the price points on laptops that are much better stocked with hardware resources fell to the point that it doesn't make much sense to save $100 anymore by choosing a netbook over a laptop. Canonical, Google, Asus and other big tech players made big bets on the rise of netbooks, and those bets have to be reconsidered.

The netbook phenomenon parallels many other similar events in portable computing over the years. Intel is now championing Ultrabooks, which appear to compete with ultralight and ultrathin notebooks of the type that Apple and others have been specializing in for years. The fact is, portable computer users want choice, and that means that the market always makes way for numerous form factors and price points. The netbook phenomenon was largely driven by the economy, as computer buyers were anxious to get their hands on low-priced systems. Many of them were later disappointed by the chiclet-style keyboards and underpowered hardware that they owned.

No other operating system in history was so squarely focused on netbooks as Google's Chrome OS. Its rise was predicted to run in tandem with the rise of netbooks, and Google initially said that netbooks were the only hardware platform that Chrome OS was focused on.

As the bloom fades on netbooks, there are many tech players who have to go back to the drawing board. In the long run, the best bet in portable computing is the one that allows for multiple form factors and designs. That's always stayed true.



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