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Google's Threat To Microsoft, Chromebooks Are Now 21% Of Notebooks And 10% Of All Computers And Tablets

Dec 28 2013, 10:11am CST | by

 
 

These figures rather surprised me as I jut hadn’t realised quite how much Chrome OS had penetrated the marketplace. Those Scroogled ads from Microsoft are now making more sense as a reaction to the very real threat that the operating system from Google offers. Of Amazon’s three best selling offerings in the field over the holidays two were Chromebooks. And we’ve near annual figures that show distinct market penetration:

The pared-down laptops powered by Google’s browser-based Chrome OS have surfaced this year as a threat to “Wintel,” the Microsoft-Intel oligarchy that has dominated the personal-computer space for decades with Windows machines.

On Thursday, Amazon.com called out a pair of Chromebooks — one from Samsung, the other from Acer — as two of the three best-selling notebooks during the U.S. holiday season. The third: Asus’ Transformer Book, a Windows 8.1 “2-in-1″ device that transforms from a 10.1-in. tablet to a keyboard-equipped laptop.

It’s not just for Christmas either, the OS has been increasingly successful over the year:

Chromebooks’ holiday success at Amazon was duplicated elsewhere during the year, according to the NPD Group, which tracked U.S. PC sales to commercial buyers such as businesses, schools, government and other organizations.

By NPD’s tallies, Chromebooks accounted for 21% of all U.S. commercial notebook sales in 2013 through November, and 10% of all computers and tablets. Both shares were up massively from 2012; last year, Chromebooks accounted for an almost-invisible two-tenths of one percent of all computer and tablet sales.

We all know what the limitations of Chrome OS are: until very recently there wasn’t a great deal you could do with a box equipped with it if you didn’t have WiFi available. That’s now changed, you can indeed work offline even if only in a limited fashion. Then again, there are ever more areas where you can indeed get free WiFi, making that limitation less serious as time passes.

There’s a more important point behind this though: Chrome OS has blown right through the sort of market penetration that Apple's Mac OS was getting in the 90s and Microsoft thought of that as a threat and quite rightly too. For the whole success of Microsoft’s Windows is based upon network effects. Everyone buys Windows because everyone buys Windows. Because that is true then everyone develops for Windows and so the loop closes. Why would you move to any other operating system if you couldn’t get the programs you wanted to run?

There are now three closely related points that are reversing those positive network effects for Microsoft. The first is rather speculative so forgive me for this: it’s that the vast majority of us don’t in fact use all of the sophistication of the software that is available to us. Sure, Word, Excel, Photoshop do amazing things. But it really is only the top end professional users who are straining at the envelope of what those programs can do. For almost all of us almost all of the time much simpler programs are entirely suitable for the uses we make of them. This makes it easier for alternatives to gain a foothold: for example, I would guess that it’s a very small percentage of Office users who need more than what Open Office can offer them. This wasn’t true, at least in my memory, a decade or more ago. Another way of putting this is that on the whole we’re much better than we used to be at writing software that is simply good enough. This lessens the attraction of highly specced programs, programs that come at high prices.

The second is the way that much of what we do with computers is now really web related. This isn’t true within the enterprise, I agree, but somewhere between most and the vast majority of consumer computing is now about interfacing with the web. We just don’t need large and complex operating systems therefore: so much of the computing is being done at the server level, not the consumer level (we’re, in fact, rapidly approaching Sun Microsystem’s old idea of thin client computing, although we don’t call it that any more). Further to this point, what most of us want most of the time is an OS that allows us to connect with said web. That obviously provides room for approaches other than Windows.

The combination of these is where the real danger to Windows lies. Sales were driven forward in the past by those network effects: everyone else had Windows, everyone was writing for Windows, therefore I must have Windows too. But if those things are no longer true then we’re going to get, pretty rapidly, to a state where Windows isn’t even the default OS for a laptop or notebook: and I can see that following to the desktop soon enough. At which point Microsoft is left competing on the grounds of price and performance. And it’s pretty difficult to compete with free on price.

Quite where this is going to leave Microsoft and Windows I’m not sure. I would expect their enterprise business to be secure for the time being as that’s going to change more slowly than any other part of the computing market. But in the consumer world these recent figures convince me that we could see Windows declining to being less than 50% of the market. Add Chrome OS and OS X together and they’re certainly more than a third of notebook and laptop sales already. The near monopoly Microsoft has had for some 20 years looks like it’s about to be broken.

Source: Forbes

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