The VAR Guy was guilty of hyping Windows-based Ultra-Portables from startups like OQO a year ago, but he has drastically changed his thinking about the Ultra-Portable computer market. He thinks current market dynamics greatly favor Linux over Windows in the Ultra-Portable industry. Here’s why.
First, some thoughts about product positioning. The OQO pitches itself as “a full PC that fits in your pocket.” Some executives and power users certainly want a small, full-functioned Windows device. But packing a lot of power into a small design requires a price premium. The OQO starts at about $1,300.
Meanwhile, The VAR Guy thinks most Ultra Portable customers want a simple, low-cost device that handles 80 percent of traditional computing tasks. Give ‘em email, Web video, a complete keyboard, presentation capabilities, a seven-inch screen, etc., and most buyers are all set.
Yes, both Windows and Linux can work on these l0w-cost Ultra Portables. But here’s the catch: In the Windows world, hardware makers typically have a lot of back-and-forth with Microsoft on design specs. And then they have to negotiate hard with Microsoft on Windows licensing terms.
The challenges don’t stop there for the Windows camp. Generally speaking, it’s sometimes difficult for hardware makers to differentiate their Windows devices from one another because they spend too much time talking about Microsoft compatibility and too little time describing unique applications.
The situation is quite different in the world of Linux. There, device makers can focus first and foremost on the key applications they want to promote to customers. Plus, they can move fast — really fast — by adapting Linux to fit their needs, or by playing multiple Linux distributions against one another to find a software partner that’s best suited to assist their efforts.
Some companies like ASUS are hedging their bets and designing Linux and Windows devices (let the customer choose). But ultimately, The VAR Guy suspects more and more hardware providers will quietly choose Linux for Ultra Portables that cost $500 or less.
Here’s the bottom line: At a time when more and more businesses are paying $1,000 or less for their laptops, it’s hard to justify Ultra Portables with price tags starting at $1,300. In stark contrast, Linux seems to be perfectly suited for truly low-cost Ultra Portables.
Is The VAR Guy mistaken? Will Windows somehow dominate the low-end Ultra Portable market? The VAR Guy is open to other opinions… and debate.
Related Coverage
- March 27, 2008: The Best Linux Marketing Tip: Don’t Mention Linux
- February 20, 2008: Linux Laptops Reach Critical Mass
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Microsoft will take more than 50 percent of this market because of its long term relationships with PC makers that are introducing ultraportables.
Yes Microsoft will most likely take more than a 50% market share… because those devices will run WindowsXP and not Vista. and more than 90% of customers are familiar with XP. however linux will grasp a far bigger percentage than the current 1%. Even more so as those customized, vendoe Linuxes mature they will outfeature and outeas XP… so my guess is 30% will go to linux.
but i stand with you that the current UMPC/MID/PHONE wave IS the marking move for customer linux.
after this linux will no longer be known an OS for appliances, servers and powerusers. i don’t see windows standing any chance after that - given it stays closed source and the ultimate edition still costs money.
[…] He thinks current market dynamics greatly favor Linux over Windows in the Ultra-Portable industry. Here?s why. The VAR Guy was guilty of hyping Windows-based Ultra-Portables from startups like OQO a year ago, […]
Windows XP Home for UMPCs is being provided to manufacturers for no cost. Which explains the eeePC selling the Linux & WinXP for the same price.
jr
jr: How do you think MSFT plans to monetize this? Any thoughts? Or is this simply a move to counter Linux at all costs?
@jr: So what software comes with Windows Home? MS office? I think you have to pay for that, almost another ultra-portable can be bought at that price.
The interesting thing about Microsoft giving XP home away, is that if people choose not to buy into Microsft’s other software, which is going to cost much the same as another UMPC, they are obviously going to use Free Open Source Software, like OpenOffice.org, which means they become familiar with the same software that runs on Linux, which makes the transition to Linux exceptionally easy.
@Joe: I hane no idea. Probably the same way they monetize InterNet Explorer.
You would be right if there were lots of device makers, but they’re not AFICT. There’s only 3 laptop manufacturers that I know of, everybody else OEMs them. That’s what I hear, please correct me if I’m wrong.
Three device makers is few enough for Microsoft to either/or/both pay off and threaten, because these device makers sell a lot of devices that run Microsoft Windows. I’d bet Microsoft is willing to spend a lot to make sure that Linux never undersells Microsoft Windows. Unless the price is lower the consumer just won’t bite, not in a big way, even if the Linux box is sold with extra hardware to compensate for the higher price.
Rumor has it that the new Asus eee will have the same price for the MS or Linux versions, but the Linux box will have more storage. (The hardware add-on with the least bling, IMO.) Raising the price is silly when you’re, well, competing on price. My bet would be that Microsoft is trying to put a floor on the race to the bottom, and that they’ll succeed — temporarily.
[…] Will Linux Dominate Ultra-Portable Market? […]
I think that Linux will take it over in time, I think that we are looking at this thing from a slightly wrong angle. We are thinking in terms of a general purpose desktop computer but reduced. This is not how it should be looked at, it is not how many manufacturers are looking at it.
You need to consider these things more in terms of mission specific devices. So, users only need to use the same thinking that they need to use mobile phones to access these new devices. they don’t necessarily need to be exposed directly to any Linuxy goodness. They may never know what Gnome or KDE is. However they may be using GTK. The real victims of this market is Symbian OS (Remember that?) and brethren. What the end user will see is a skype button, or an application-x button. On a carefully crafted interface. The idea, is that the manufacturer isn’t providing the user with a computer but a bunch of services via a thingy that they are selling.
Its more of a tool for a manufacturer to sell kit. Think of them as more of an embedded device than a small PC. Open Source software has just provided them with a good enough tool kit so that they can keep their development cost down.
Anyway, that’s what I think.
I think the most interesting thing about these ulra portables is that for years we have discussed the so called “year of the desktop” and it looks like Linux is going to skip that entirely and go straight to the “year of the portable”. Who would of imagined that happening a few years back?
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No, Linux cannot even get close to 50% market share in UMPCs.
No body f***ing cares about linux, even though it’s a lot better & cheaper than Windows.
There is a lot of software which runs only in windows and people are used to those applications and don’t want to switch to Linux just because it’s less expensive. I’d be surprised if linux can get around 10-20% market share.
@penguin, what Sofware would that be? Photoshop? MS Office? SAP?
Remember, we’re talking a small screen and very limited ressources for todays standards.
who’s care about the OS in UMPC ???
In response to penguin.
Linux already has 100% of the eeePC market. Now windows is playing catch up in that market. So much so that Microsoft is GIVING AWAY XP Home edition.
The real question is Microsoft Office. If people want to edit documents on an eeePC. They can get it with Linux all ready to go at $400.00 Or they can get it with XP Home and still have to buy Microsoft Office.
If you were going to install OpenOffice on an eeePC, you just as well get the Linux offering with more flash memory for the same price.
There was also an article Dutch UMPC runs Ubuntu Linux http://www.linuxdevices.com/news/NS3257992292.html It is a Chinese CPU and it runs Linux.
Remember, you must have intel x86 compatibility to run XP Home. There are a lot more ways to cut costs on these things by going with a different CPU architecture. Linux will run on those systems. XP will not.
This market is a race to the bottom. People are already lining up to buy the eeePC with Linux on it when there is on Windows version available for $350 to $400. Anyone has a chance to outsell the eeePC by making a unit that does as much or more hardware wise for $250 to $350 if they ditch Windows compatibility.
Remember, it is Linux’s market to lose and not all the players are going to be laptop makers who have had deals with MicroSoft in the past.
How it will likely breakdown:
Linux on most emerging world UMPCs.
Linux or Windows on most European and Japanese UMPCs.
Windows on most North American UMPCs. (unfortunately)
Apple will come out with a 6 - 8 inch Touch that will take huge market share. Linux will always have a price advantage and will dominate the price-conscious crowd. Windows will be way marginalized to the Gates-is-god fanatics and those too slow to adapt.