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A Netbook, an iPad Pro and the Surface Walk Into a Bar

The Netbook fiasco let the cat out of the bag -- consumers are not pushing the limits of their PCs.

Jeff Wilcox/Flickr

A version of this essay was originally published at Tech.pinions, a website dedicated to informed opinions, insight and perspective on the tech industry.


It’s not something I talk about often, but I was right in the middle of the Netbook debacle. The Netbook category was an accident. It was not Intel’s intention to have a small, not very powerful, yet cheap “PC” enter the marketplace. Asus took a chip that Intel wasn’t positioning for a clamshell form factor, and made a tiny PC that ran Linux. While initial sales of this product were not large, other OEMs caught on and wanted to ship Windows on it. Both Intel and Microsoft thought this was a good idea to get new hardware onto the landscape, but both of them prefaced this thinking with the caveat that these machines could not be “full-powered” PCs. Meaning that it needed to be made clear they could not do everything a full-powered PC can do.

The Netbook fiasco let the cat out of the bag — consumers are not pushing the limits of their PCs.

From the outset, I told both companies, in my analysis notes to them, that this was a bad idea. It would uncover the dirty secret that most consumers do not do very much with their PCs. My firm had just done some dedicated research on PC behavior in consumer markets, and the data we discovered at the time gave us the insight that consumers, on average, use five pieces of software regularly on their PCs, and none of them were CPU-intensive tasks.

My fear was that these machines would be viewed as good enough for most mass-market consumers, and would threaten the PC category as a whole with steep ASP declines. No one believed me. Sure enough, the chips got a little better on Netbooks, enough to watch good-quality videos without skipping, for example. Microsoft eased up and let more of the capabilities of Windows on the hardware and — boom — 40 million devices at its peak of PCs under $200.

To add some perspective here, note on this chart of PC sales sliced by consumer and enterprise PC sales, the peak year for consumer PC sales also was the same year that Netbooks peaked:

Netbook walks into a bar


Microsoft and Intel reacted quickly to this, with the help of some smart guidance, and brought this back under control, essentially killing the category. But what the Netbook fiasco did was let the cat out of the bag — consumers are not pushing the limits of their PCs. They are doing simple things like watching movies, browsing the Web, checking email, messaging friends, etc. They aren’t creating the next major novel, they aren’t exporting cells from Excel. They aren’t making a two-hour Hollywood motion picture. Their needs are simple, and the Netbook — an underpowered, small, cheap, Internet-connected, clamshell PC — was good enough for them.

I tell you this because it applies to how I think about the positioning of the iPad Pro and the Surface Pro 4. No, I don’t think either of those products are anything like the Netbook. Quite the contrary. However, both represent the needs of and an opportunity for two different markets. The Surface brings all the things a hard-core, technologically literate PC user needs in an ultraportable form factor. You can do everything a tech literate can, and push the boundaries with computing tasks that those users want. You can plug it into an external monitor and do even more. The Surface is a PC, and exists as a form-factor option for those who know how to use and drive a PC like a pro. But remember what I said about the Netbook: That PC user, who can drive a PC like a pro, is not the mass market. Not even close. That’s where I’ve always felt the iPad comes in.

The harsh reality is that mainstream consumers do more with their smartphones to utilize their max capabilities today than they ever did with their PCs.

The iPad is certainly more powerful than a Netbook, and the software is much more capable than ever it was on a Netbook. However, a central question I was wrestling with during the brief Netbook era was, why are consumers not doing more with their PCs? Even those who had a top-of-the line notebook or desktop in that era were still only using a small fraction of its capabilities. What I uncovered was they simply didn’t know how. The PC was too complex, too burdensome, they were afraid of breaking it and then having to spend hours on support trying to fix it. Many consumers that we studied and surveyed at the time did not have positive things to say, generally, about their PC experience.

Then the smartphone hit the scene. The harsh reality is that mainstream consumers do more with their smartphones to utilize their max capabilities today than they ever did with their PCs, then and now. I think this is a tragedy. Not because of all the things they do with their smartphone and not a PC, but because humans are capable of so much more with digital tools and creativity. Yet most don’t engage in it.

Hardware and software companies need to give consumers the tools to easily — and I stress easily — use these tools to their maximum potential. Desktop operating systems like Windows and OS X are for the professionals. Mobile operating systems are for the masses. The promise of something like the iPad and the iPad Pro — and where Android can go on tablets, or laptops or even desktops — is to empower the masses to do more than they can on their smartphones, with a computing paradigm that focuses on simplicity but still yields sophisticated results.


Ben Bajarin is a principal analyst at Creative Strategies Inc., an industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research. He is a husband, father, gadget enthusiast, trend spotter, early adopter and hobby farmer. Reach him @BenBajarin.

This article originally appeared on Recode.net.

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