Netbook prices are falling and may reach $250 before Christmas.
The entire category of so-called netbooks
... may be headed over a price cliff, according to industry analysts. That notion was one take away of the Intel Developers Conference, which took place in San Francisco this week [where dozens of models were shown].
The category threatens to upset some very established computing giants from Microsoft to Hewlett-Packard because they dont require the powerful on-board software and computing power that have driven marketing and sales in the past.
Intel's message should be taken with a grain of salt by makers. It is true that sub $200 computers threaten their monopoly position but netbook computers have been a run away success. Newcomers would do better disrupting the monopoly than they will catering to it by restricting features and function.
Microsoft plans to offer PC makers steep discounts on Windows XP Home Edition to encourage them to use that OS instead of Linux on ultra low-cost PCs (ULPCs). To be eligible, however, the PC vendors that make ULPCs must limit screen sizes to 10.2 inches and hard drives to 80G bytes, and they cannot offer touch-screen PCs.
Besides limits on the screens and hard drives, to be eligible, the systems can have no more than 1G byte of RAM and a single-core processor running at no more than 1GHz. The program makes an allowance for some chips, including Via Technologies' C7-M processors, which run between 1.0GHz and 1.6GHz, and Intel's upcoming Atom N270.
Moore's Law will prevail and soon there will be more money selling to customers than there is in dealing with Dell, HP and other M$ monopoly buddies. Makers who distingish themselves now will build their brand. Those who stick to limited hardware will drown in the competitive swamp Intel and M$ have created while Dell and others forge ahead with multi touch and other cool features.