There isn't much mystery to why a little-marketed computer known as the Eee PC has lately seized the top spot on Amazon's laptop best-seller list. The machine, a three-pound ugly duckling made by the Taiwanese company Asus, has a 10-inch screen, a nearly full-size keyboard, and offers what almost everyone wants in a portable computer: It's tiny and, at $390, very cheap. Of course, the Eee PC is missing some other things people tend to like in laptops—an attractive design, a DVD drive, a fully full-size keyboard, and enough processing power to run multiple demanding applications at the same time. But hey, these are tough times, and did I mention you can buy this machine for less than you're planning to blow on New Year's Eve?
Minimalism pervades Amazon's laptop list; over the last few weeks, the great majority of the 25 best-seller slots have been occupied by various permutations of the Eee PC and other souped-down, sub-$500 machines. In the computer industry, these miniature computers are known as "netbooks." The term is vaguely defined, but the best way to spot a netbook is to peek at the specs: Today's bigger laptops run on Intel's speedy Core 2 Duo processor, while netbooks use a smaller, less powerful, and cheaper Intel chip, the Atom. Netbooks also run older or more lightweight operating systems—generally Windows XP or some flavor of Linux.
PC companies are looking to these machines in much the same way John McCain once looked to the governor of Alaska—as an easy way to put a fresh face on an otherwise aging product line. Asus took an early lead in the category, but in 2008 nearly every major PC maker put out a netbook or two, including Dell, HP, and Lenovo. New netbooks will dominate CES, the consumer electronics trade show in Las Vegas next week, and completely unsubstantiated rumors have it that a netbook will also debut at MacWorld, the Apple-centric confab that starts Monday in San Francisco. It's still unclear whether this season's sales represent a trend or a fad—netbooks offer a user experience that's far from perfect, and buyers may well come to regret their chintzy purchases and vow to pay full-fare next time. Netbooks' rise could also end badly for the PC industry. As a Sony exec predicted this year, cheap machines may spark a pricing "race to the bottom," further shrinking PC makers' already squeezed profit margins.
But netbook sales suggest pent-up demand for the kind of machine that no company has yet perfected—a machine that I predict could make for the next PC boom. At the moment, the laptop market is dominated by two kinds of machines: a bunch of cheap netbooks that don't do much, and a bunch of expensive Apple notebooks that do a lot and do it very well. (Seven of the top 25 best-selling laptops on Amazon are MacBooks.) Consumers are fleeing the middle range, which seems to make sense—if you want a laptop to surf the Web, why spend $800 on a machine that runs Windows Vista when you can spend $400 on a machine than runs the more highly regarded Windows XP? On the other hand, if you want a laptop to use as your main computer, why spend $800 for a machine that runs Windows Vista when you can spend $1,000 for a virus-free, hassle-free system that runs the Mac OS (and can also run Windows)?
But I argue that there's gold buried in the gap between these extremes: The success of the netbooks speaks to a desire for second PCs, for machines that we can use on the couch or on the train, rather than at a desk. Their popularity seems of a piece with customers' growing appetite for simpler, less frilly gadgets. The netbook is like the Flip camcorder of laptops, a device whose myriad limitations seem to enhance, rather than detract from, its appeal. But we need a better such machine: Someone needs to build a good-looking, easy-to-use, and not-too-terribly expensive portable computer that aims to do one thing well—surf the Web.
At the moment, netbooks could stand a great deal of improvement. First, they're ugly—many are more than an inch thick, which isn't bad for a standard laptop but looks kind of goofy on a little guy. They've also got a few flaws that keep them from excelling at their main task of lightweight network computing. In particular, many lack access to cellular networks—if you want Internet connectivity away from a Wi-Fi hot spot, you've got to get it through an add-on card or by connecting the computer to your cell phone. (Some newer models—like the Acer Aspire One—do carry a 3G chip, and we can likely expect some more 3G-equipped models at CES.) More importantly, netbooks need better operating systems—in particular, a very fast, mobile operating system that can download and install trusted applications on the fly, over the air.
It may sound like I'm calling on Apple to build a netbook. I'm not. For years, people have exhorted Apple to build cheaper computers, a clamor that's only risen during the recession. But CEO Steve Jobs has consistently disavowed this approach for pretty much the same reason cited by that Sony exec—a race to the bottom that ends in "junk" machines. More importantly, proponents of an Apple netbook forget that the company already makes an underpowered, ultraportable computer: It's called the Macbook Air. If Apple were to release a cheapo, tiny laptop, won't customers wonder what to make of its high-ticket, tiny laptop?
Instead, I'm suggesting that the thing we think of as a netbook should really be something else—a flat-panel, touch-screen tablet that can do photos, music, movies, e-mail, games, and full-function Web browsing. The device would include a small amount of onboard storage but would depend on the Internet cloud for most of its resources. Why no keyboard? Because then the device would be conceived as an appliance. You'd use it mainly for passive computing—for reading e-mail and Web pages, for looking at photos, for sharing documents in a meeting. You'd keep it on your lap to scan Facebook as you watch TV or bring it to bed to read the news before you go to sleep. You'd catch up on your e-mail as you ride the bus to work; you could respond to that e-mail using the on-screen keyboard, and when you get to the office, you could connect a USB keyboard.
Apple could make this, of course. What I'm talking about is basically a souped-up iPhone or iPod Touch—say, one that's 7 inches across instead of 3.5 inches and has a slightly faster processor. These could sell for $400 or $500 (plus the purchase of a data contract). Apple's fans have long called on the company to build a tablet computer, but this isn't just a suggestion for Jobs. A host of other firms could make such a device, including Sony, Samsung, Nokia, and Motorola. Or, a startup: Over the summer, the TechCrunch blog launched its own crowd-sourced project to spec and build a cheap Web tablet; as of now, the community has built a rough prototype. Any company that builds one of these things doesn't even have to worry much about software; that's because the computer industry now has free access to Google's open-source Android platform, which has a stylish interface, an intuitive touch display, and a marketplace for third-party programs. Google, of course, would also benefit tremendously from the proliferation of a network-capable device that would keep you addicted to the Web throughout your house. Indeed, there are so many potential beneficiaries here—Apple, Google, Intel, the cell companies, and, of course, Web-addled you and me—that I'll be surprised if we don't see a great Web tablet in 2009. I can't wait.