The announcement this morning about Google launching a netbook operating system next year is interesting for a few reasons.
One of the things I like the best about technology is its disruptive nature, or maybe better put, the disruption technology has on business models that aren't flexible enough to adapt when technology adapts.
Netbooks are one of the fastest growing segments of PCs. We ran a story yesterday about Sony finally getting into the game with their first netbook -- priced under $600 (I know, a Sony product for less than $600! Whoo-hoo!) -- playing catch up to Asus, HP and Dell. IDC says global netbook shipments in 2009 will more than double from last year to 26.4 million units, which is nothing to sniff at.
So now that we have all of the contenders in the ring, what makes netbook so great? They don't have much processing power (which will change) and they have pretty limited storage space. Sony's new netbook, for example, will have a 130Gb drive. But considering how inexpensive portable pocket drives have become -- you can get a nice 500Gb pocket drive the sizes of a wallet for about $150 -- and how much computing we do in the cloud now, a small hard drive is not as limiting as it used to be.
Their attraction is that netbooks are cheap and small and are the perfect tool for road warriors, transit commuters or folks with enough disposable income to buy a second or third PC for the home that they'll use primarily to stream media and access the net.
I've been playing with an Asus Eee PC 1005HA Seashell netbook for the past few weeks and am a netbook convert. The Seashell is a pretty thing that's about a s big as a hardcover, though half as thick. It sits in my kitchen connected to a couple of portable speakers and I've used it more than my other notebook, which is big enough and powerful enough to play most PC games. I've streamed music, listened to ball games and looked up recipes -- I tell you, a computer in the kitchen fits much more naturally than you'd think.
But the Seashell's small size and portability made a trip to the dump on Saturday kind of... enjoyable. Like many people in and around Toronto, I drove to Pickering to empty a van-full of garbage. The line up to get in and get out looked to be about an hour and a half, but instead of drumming my fingers in frustration I tethered the netbook to a borrowed iPhone 3Gs (via Bluetooth, no less) and spent the time cleaning out my inbox.
But of course netbooks aren't good for everything, primarily because they're not very powerful -- a fact that has plagued Microsoft and which makes the Google announcement so interesting.
When Microsoft was developing Vista, they didn't have netbooks in mind. Running a netbook on Vista is like riding a bike on a beach. Most netbooks have Windows XP or a Linux OS (and Google's Android) on them because they just run faster and have a longer battery life on the older operating systems. The big question for Microsoft now is whether Windows 7 will change that dynamic -- something they say will.
But the thing is, Microsoft will not own netbooks like they own desktops and a big chunk of the notebook market. It's already fragmented. And with a low-cost (or even free?) Google OS vying for market share? Strategically, this is the perfect time and the perfect platform for Google to get into the OS business.