Summary
LG Electronics had pulled notebook sales in India because of low volume consumer sales. But, LG is now ready to reenter the market with Netbooks (mini Notebooks) by the end of the year. Why?
Analysis
Some OEMs, like Nokia and LG Electronics, appear to be picking up on the pending explosion in Netbook sales and the collapse of the traditional notebook computer market.
Why is this drastic shift in device sales from notebooks to Netbooks going to occur?
Microsoft is reinventing itself. Microsoft Windows 7 is designed for the new breed of Netbook devices and will easily dominate the market. Not because of volume. Because of quality and breadth. Microsoft recognized the opportunities and intentionally slowed down the sales of Netbooks by placing restrictions on how XP can be packaged and sold.
Microsoft Office 10 will move the software giant's application suite from traditional fixed platforms into the cloud. Same capabilities. Same user experience. Very small footprint. Will a different sales model arise? Free entrance level packages have already been discussed. Per Usage billing for best of breed?
Microsoft Media Player 12 and Microsoft Media Center will pull together all media types and position Microsoft Windows based platforms as the predominant media platform in the home and on the road.
LG, through its initiatives with Microsoft, is positioning itself to be an early winner in the Netbook sales explosion that is coming. Stop thinking just consumer sales. Think enterprise sales - small, medium and large. Government sales.
So many things are changing right now. And they are accelerating:
- Cloud based data centers and computing have become practical with virtualization, deduplication, solid state technologies and more.
- Software vendors, large and small, are aggressively moving products to the cloud. Check out Epicor (NASDAQ:EPIC).
- Everyone is chasing the small to medium enterprise as the untapped market. Dell (NASDAQ:DELL)/ATT (NYSE:T) with ProManage. Unisys (NYSE:UIS) and its Cloud offerings.
- Software footprints on portable devices will shrink dramatically. Installation, deployment, support and replacement will be greatly simplified. Watch Microsoft Office 10.
- Security will become much easier to guarantee through minimized content on the device. Watch for Microsoft Security Essentials to drastically change this market.
- Long Term Evolution (LTE)/4G will provide the bandwidth needed and the quality of service required.
- Device refresh rates within enterprise customers will accelerate as devices become cheaper and less complex to deploy.
The entire consumer and business IT and communication infrastructure models are shuffling. Unified and ubiquitous communications are being redefined and are now practical. Doors are opening for both large players, like LG and Nokia, and small players. Everybody better start running now...the door of opportunity is already wide open.
David Croslin consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
