Netbooks With Android, Likely A Gimmick Over Substance (GOOG, MSFT, DELL)

Apps & Software

Published: June 2, 2009 11:32 am

Last Updated: April 28, 2020 2:27 am

There is rather a large amount of buzz out there, and perhaps some confusion, today about Acer’s use of the Android operating system from Google Inc. (NASDAQ: GOOG) for netbooks. Acer will begin selling netbooks in the third quarter of this year that use Android. Most netbooks today come with Windows XP on them, which is of course from Microsoft Corporation (NASDAQ: MSFT). Dell Inc. (NASDAQ: DELL) already has a netbook running without Windows.

It seems that Acer will be make the first notebooks and netbooks to run on the Android platform, and that is on the heels of a smartphone announcement. The obvious goal here is cost savings, as Windows XP costs about $25.00 per unit. With Android being open source and essentially free, you know where this is heading. I bought a netbook for ultimate mobility and for a total lack of cares about what happens to the PC. In short, it is worry-free and throw away computing as far as I am concerned. But the netbook happened to come at a magical time. It turns out that the $399 price tag (and $299 on some) makes the affordability factor a winning formula during the recession.

After looking at the Best Buy site, it looks like Asus now has a model for $249.99 that comes with Windows XP loaded on it. Dell also has a netbook running on the Ubuntu Linux operating system.

Unless the goal is to drive the cost down to zero and unless this netbook trend is intended have to zero interoperability and zero utility use for mobile workers, then it seems that Windows not being on all netbooks is not exactly going to be Windows being excluded from all netbooks.

It is also not irregular for a PC-maker in today’s world to diversify even among operating systems. Acer has gained market share and is not any longer an off-brand in the U.S. We think this is a strategy expansion rather than a major strategy shift.

Free is hard to compete with, particularly in hard times. But free also comes with a challenge in and of its own: zero incentive. Microsoft shares are flat at $21.40 after having traded up earlier this morning.

JON C. OGG
June 2, 2009

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