Are Netbooks The Future For The PC Market?

Chip designer ARM's chief executive says that netbooks are the future of computing -- and the future doesn't need Microsoft. Is he onto something here, or is he just blowing smoke?ARM isn't a household brand, but the company licenses processor designs that power a vast array of portable devices, smartphones, and embedded systems. Now, according to ARM head Warren East, the company wants to dislodge Intel in the netbook market, where the company sees a very bright future: "Although netbooks are small today  maybe 10% of the PC market at most  we believe over the next several years that could completely change around and that could be 90% of the PC market," said East. "We see those products as an area for a lot of innovation and we want that innovation to be happening around the ARM architecture." Today, a typical netbook uses ARM processors to handle secondary functions like wireless networking and disk controllers. In order for ARM to compete against Intel's Atom processor in the netbook CPU space, it must address one key issue: Windows support.

The problem is that while most Linux distros are capable of running on ARM processors, Windows does not. Yet while Microsoft has no plans to port Windows to the ARM architecture, East thinks this is a problem that will solve itself: Whats holding it back is peoples love of the Microsoft operating system and that fact that its familiar and so on. But actually the trajectory of progress in the Linux world is very, very impressive. I think its only a matter of time for ARM to gain market share with or without Microsoft." And the ARM boss claims he's not pestering Microsoft to broaden Windows' processor support. "Theres not really a huge amount of point in us knocking on Microsofts door," he said. "Microsoft knows us very well, its worked with us for the past 12 years, all its mobile products are based on ARM. It's a bold statement. And I think that it sounds more like posturing than prophesy. East didn't elaborate on where he got that 90 percent figure; until he cites a source, it is safe to assume that he (or his PR staff) simply dreamed it up.

East's remarks also ignore the possibility that Microsoft could design Windows Mobile 7 to work effectively on netbooks. That would give Microsoft an ARM-ready netbook option, and it would give WinMo 7 something useful to do -- since the smart money is betting that WinMo is finished as a serious player in the smartphone market.

I think that ARM does, indeed, have a compelling story to tell about its place in the netbook market. Linux-powered netbooks running ARM processors are likely to be cheaper and more energy-efficient than Intel-based netbooks, especially if Microsoft intends to charge hardware OEMs more for Windows 7 than it did for XP.

But marginal gains against Windows as a netbook OS are one thing. Grandiose predictions of doom for Redmond are another. If Warren East wants the world to believe that his crystal ball isn't on the fritz, he has his work cut out for him.