When it comes to PCs and laptops, Microsoft had little to fear with Linux as much as it does the Mac. But now the new threat to Windows comes in the form of 'netbooks' - lightweight, low-cost laptops that typically use Intel's low-powered Atom processor and don't come with substantial amounts of RAM or powerful graphics processors. They're designed mainly for browsing the Web, handling e-mail, writing memos, and taking care of simple word-processing or spreadsheet chores.
Netbook sales will reach an estimated 60% growth in 2010, compared with 18% growth for standard notebooks says a September BNP Paribas report. So obvious is the future in Netbooks. But the hardware demands of Vista can't be met by Netbooks (and a reason why Microsoft keeps extending XP's lifetime) and Linux is ideally suited for lower-powered netbooks. At least 30% of the existing low-cost netbooks run on Linux.
Microsoft sees Linux on netbooks not just as a niche market, but as a threat to Microsoft's desktop share as well. It's finally taking Linux seriously as a desktop operating system, and Windows 7 is looking to be the tool Microsoft has designed to kill Linux. At Microsoft's recent Professional Developers Conference, where the pre-beta of Windows 7 was unveiled, Steven Sinofsky, Windows Senior Vice President, showed off Windows 7 on his Lenovo S10 and said it used less than half of the netbook's 1GB of RAM.
Jerry Shen, CEO of Asus, announced that he plans to release versions of the Eee PC powered by Windows 7 in mid-2009, including a touch-screen version. With netbook return rates much higher for Linux than Windows XP versions, the high point for Linux netbook sales will be from now until the launch of Windows 7. After that will come the inevitable decline. Ultimately, consumers will be the ones to tell us what they really want in a device like this, and how they would use them.