Lenovo on the future of the netbook

May 9, 2009

Lenovo on the future of the netbook The introduction of the netbook has heralded an era of cheap, portable and convenient computing, but what does the future hold for the netbook? TECH.BLORGE spoke to Lenovo’s Worldwide Competitive Analyst, Matt Kohut, about his vision of the future of netbooks, which involves Windows 7, bigger screens, built-in 3G, touch integration, and lower prices.

Linux fans will no doubt be disappointed that Kohut predicts that Windows 7 will be the dominant operating system on netbooks in the future. According to Kohut, the reason for this is that Windows 7 offers a better, familiar solution, with the benefits of touch.

Kohut also addresses the interesting issue of the intersection between netbooks and notebooks, and the challenges that vendors face. Here then, is the interview:

TECH.BLORGE: So how do you see netbooks evolving in the next few years?

Kohut: The original (netbook) designs were all based on an Intel reference design that Intel produced at about the time that the Atom chip came out.

That’s why the first generation netbooks were all very similar, and now that we have gone beyond the first generation and we are starting to see second and third generation netbooks.

Initially people weren’t sure what to do with them. Retailers were saying, "here’s this new netbook PC", and the average person picked one up and said, "oh wow, that’s small, maybe I can run photo shop". So, as an industry, we ended up with a lot of returns, because the functionality of what netbooks could do was not well communicated.

What happened too is that, with any first-generation design, it’s pretty limited function.

The average netbook has an Atom processor and either has some kind of solid-state memory drive or perhaps a spinning drive, it’s got a basic amount of memory, and it is probably running Windows.

Now, people are asking for more functions, so as we move into the next generation, we are starting to see things like integrated 3G and bigger screens.

There is no reason why a netbook has to be a small system.

People say, "maybe if we go 12 or 14 inches as we go to larger systems, I just need the system to do basic things, but I don’t need something that is super expensive either."

Now, from a vendor perspective, it’s also been kind of interesting for us too, because as the subsequent netbooks get introduced, some of the competition is trying to push the price points higher.

But, with standard notebook prices coming down, you start to see an intersection where, well, does it make more sense to just buy a notebook with the lower end Celeron processor so that it can do everything you want it to do versus buying a higher end netbook that is going to be limited in some way?

So, that’s been one challenge.

The other challenge has been, in order to keep the price points down, a lot of people thought that Linux would be the saviour of all of these netbooks.

You know, there were a lot of netbooks loaded with Linux, which saves $50 or $100 or whatever it happens to be, based on Microsoft’s pricing and, again, from an industry standpoint, there were a lot of returns because people didn’t know what to do with it.

Linux, even if you’ve got a great distribution and you can argue which one is better or not, still requires a lot more hands-on than somebody who is using Windows.

So, we’ve seen overwhelmingly people wanting to stay with Windows because it just makes more sense: you just take it out of the box and it’s ready to go.

TECH.BLORGE: So, where do you see netbooks going in the next year, the next five years, and, if you are willing to speculate, even beyond that?

Kohut: Over the next six months, you are going to see a lot of 3G built into these.

You know, our first netbook had an express card slot where you could add a 3G card later, but a lot of people said that we need it built-in, so that’s why we are seeing a lot of people or a lot of telecom companies bundling – you know, sign up for two years service and get a netbook and, of course, they want you to use their 3G plans and get hooked and maybe you will do all sorts of other things.

The big change comes late this year, depending on when Microsoft releases Windows 7.

Windows 7 is going to have, not a true netbook version, but a version intended to work especially well on netbooks.

One of the cool things that Windows 7 does is touch.

So, it’s not far off to have a netbook where you have full touch integration built into it and not just drag/drop but full multi-touch where you’ve got all the gestures, you know, the flicks… I’m not a touch user, but you get my point.

You know, the pinch, the drag and that sort of thing.

There has been a lot of work on that: Microsoft really, with its Surface initiative, if you remember that, it was big, the size was boardroom, and I actually got a chance to see it, it’s slick.

But, what they are trying to do, is they are trying to replicate that in the netbook world or even in the standard notebook form factor as well.

One of the challenges is, as these screens especially get smaller with touch, I don’t know whether you have ever tried to use an iPhone or not, but when you type, sometimes it thinks you type the G and sometimes it thinks you type the H.

So, one of our focus areas specifically is how do we overlay on top of what Windows is offering certain things where we can bring up – if you are going to bring in touch, how do we overlay common tabs so that now we can enter numbers, how do we make the keypad bigger, for example, for that certain thing?

And that’s been a huge area of focus and we’ve had a lot of ideas, everything from, "who says you should just have to use the predefined gestures, why not make your own, so that when you gesture a circle, it launches your e-mail client for example?"

And people get touch, it’s yet another way another way of interacting with your system.

TECH.BLOGE: And what about beyond the next year? Where will these products evolve to?

Kohut: Over the next five years, we are going to see a lot of different sizes of netbook.

So, today you see the 10 inch, moving into the 12 inch, price points are only going to keep dropping across the industry; that’s a given.

TECH.BLORGE: Price points, dropping? Really?

Kohut: If you had told me five years ago that I was going to see a regularly selling notebook for $799 and it was going to be a full function notebook, I would have said you were crazy.

But, now look what we have today.

Even on special you can get notebooks for a lot less than that.

What has really helped is that Intel and all the other vendors are getting better at getting the whole system integrated on the chip. With the newest generation of processors, for example, you have your chip, your processor, plus your Northbridge, your Southbridge, and memory controller which is separate, now they are integrating them into the processor.

It’s to the point where the average user of the standard PC, not so much for the big storage for your videos or what not, want 80 GB or 120 GB.

The price points there keep dropping.

So, price points are only going to drop and, with that, come more degrees of freedom, more functionality, bigger sizes, more sizes and, with that, will also come a lot of integration, better with the different types of devices you own – your mobile phones, your Bluetooth headsets, your iPods and your iPhones and what not.

So, we can see a whole lot of proliferation coming.

Every time I think it can’t get cheaper, it does.

And, it’s also an industry problem because now we have to sell three or four of these in order to meet the same revenues that we were getting from one notebook.

TECH.BLORGE: Where do notebooks fit into this whole thing?

Kohut: Notebooks aren’t going to go away, because again, one of the things that is helping us as an industry is that Intel is trying very hard to limit what netbooks can do.

Again, that’s why they are always touted as “surf the web”, e-mail, and that’s about it, so a lot of companies recognize that it wouldn’t be worthwhile to give their employees netbooks instead of notebooks.

But, you know what, the pace of computing also marches on.

Even with my full-size notebook, there are some websites that I go to, Facebook is a good example, where I have to wait for it to load and it’s even worse, for example, on the netbook.

With applications such as Microsoft Exchange, Lotus Notes and Java, there is still a need for full function computing, even if you are a not a corporate user, even if you are a home user, you are still going to have somebody who wants to play games, you are still going to have certain applications and sites that require additional horsepower.

So, there is still going to be a need for notebooks: some people will see netbooks as second devices, as companion devices – I just want to grab this when I go off to do whatever – but, other people are going to say, well, why own two things where I’ve got to worry about syncing them, where I need to make sure that the data is the same as on my other notebook. So, some people just don’t want that hassle either.

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