1) First, really and truly guys, if Microsoft has its way, we're going to see Windows 7 Starter Edition on netbooks in North America and Western Europe. You don't have to believe me, read what Windows General Manager Mike Ybarra had to say in February, "Windows Starter edition will now be available worldwide. This edition is available only in the OEM channel on new PCs limited to specific types of hardware." He's talking about netbooks.
There will be a version, however, of Windows 7 that won't be offered in first world countries. It's Windows 7 Home Basic, not Starter Edition.
Now whether or not netbook manufacturers are going to want to offer Windows 7 Starter Edition is another question entirely. Acer and Intel both have real doubts about Microsoft's netbook plans
Ideally, what Microsoft will want you to do is to buy your low-cost Windows 7 netbook with Starter Edition, get disgusted with it, and upgrade to Windows 7 Home Premium. Sources tell me that most Starter implementations will include and instant Home Premium upgrade feature. This will work by paying an additional license fee to Microsoft over the Web. In return, you'll a new license number that will unlock the Home Premium features.
I see this as a 21st century bait and switch game. Microsoft sucks you in with a low price, and then, to really get a full-strength operating system, you need to shell out more cash. Intel CEO, Paul Otellini, for one, doesn't think this is a great idea. According to the Wall Street Journal, Otellini said at an investor conference in February that Microsoft's plan to convince consumers to upgrade from the Starter version "is going to be tough for a bunch of reasons." You think?
2) Second, and what both Intel and Microsoft would really like you to do, is to buy a netbook that straddles the difference between the low-powered and cheap, sub-$400, netbook and the over-$600 notebook. We already have systems like this today. For example, the HP EliteBook 2530p has a netbook's size, but at a price-tag of about $1,500 and a 1.86GHz Core 2 Duo processor and 2GBs of RAM that's the only thing that's netbook about it.
With the advent of Intel's next-generation of dual-core Atom processors and 2GB standard memory in netbooks, we're going to see netbooks that will have the power to run Windows 7 Home Premium without any problems. These are the models I expect Microsoft and Intel to push to customers by the fourth quarter of 2009.
3) Linux will be able to run on these systems as well of course. But many Linux vendors are exploring another option: offering desktop Linux on ARM CPU-based netbooks that will be even cheaper than Atom-based netbooks.
Linux has been running on ARM processors for years. What's changed is that both ARM and Linux desktop distributors like Xandros and Canonical, the company behind Ubuntu, are working on releasing full Linux desktops for ARM-powered MID (Mobile Internet devices) and netbooks.
The upshot of these efforts is that by the same time Windows 7 Home Premium will be available on $400 Intel Atom-based netbooks, Ubuntu 9.04 and Xandros Linux desktops will be shipping on sub $200 ARM-based netbooks.
Can you say price-war? I can.
4) Last, but never least, there's Google. The first Google Android netbooks have been spotted. I've said it before, I'll say it again, people who would never consider moving from Windows to Linux might be willing to give a Google Linux-powered netbook a try. With Google behind it, the Linux desktop will finally break into the mainstream.
What all this will mean to you is that you're going to have a heck of a lot of netbook choices. While I still don't see Apple entering the netbook market, you will have at least four other choices.
The one to avoid will be the low-end Windows 7 Starter Edition netbooks. You won't get enough bang for your buck. Then, there will be higher-end, but more costly netbooks with Windows 7 Home Premium. If you're set on Windows, those will be the ones for you. The ARM Linux desktops will probably be the cheapest of them all, and they'll be the ones for old-school Linux fans. The real wild card will be the Google Android netbooks. I imagine they'll be low-priced, but not quite as cheap as the Xandros and Ubuntu models. These devices will combine the benefits of both desktop Linux and Google's Web-based applications into a single integrated package. I suspect that Google's netbooks might be the best-selling netbooks of all.
Ladies and gentlemen, we're in for some interesting times.