7 ms·

$149 is ridiculously cheap and I don't think Microsoft wants, or should want to operate in that market. At the $200-$300 price range there are many Windows cho

$149 is ridiculously cheap and I don't think Microsoft wants, or should want to operate in that market. At the $200-$300 price range there are many Windows choices - most with significantly better hardware and features. Microsoft: Leave the sub $200 market to others and leverage your online services to sell to those consumers.

SwellJoe 12y ago
Microsoft ate IBM and others from the bottom, because the margins were too low on PC vs mainframe and minis. And now, you're suggesting Microsoft should accept being eaten from the bottom because the margins are too low (I guess that's what you're arguing). Classic innovator's dilemma scenario. Those who don't learn from history will repeat it. Even those who made the history in question.
- cardine 12y ago
  What makes the Chromebook a disruptive innovation?
  - austinsharp 12y ago
    It's cheaper and simpler with less functionality. Isn't that the broad idea [1]? [1] http://en.wikipedia.org/wiki/Disruptive_innovation http://en.wikipedia.org/wiki/Disruptive_innovation
    - cardine 12y ago
      A disruptive innovation is an innovation that creates a new market. What market does the Chromebook create that a $200 netbook didn't already create?
      - SwellJoe 12y ago
        Sometimes, all it takes to be disruptive is to be cheaper. "What market does the Chromebook create that a $200 netbook didn't already create?" I prefer to think we mostly find markets rather than create them, generally speaking. Chromebook may find a market in India or Africa or China. Places where a mobile device was everybody's first experience with personal computing, so the idea of it being intimately tied to the network isn't so strange. And, just as importantly, where $50 is a weeks wages so it seems a lot more important to spend 25% less on the device. I can see how me invoking Innovator's Dilemma here is possibly a stretch from some perspectives. Even if it is not disruptive innovation in the sense you prefer, it is still seeming more and more likely to continue to erode Microsoft's dominance in the places they have always been very, very strong: Cheap home PCs. Also, I think the argument could be made that this is a better product for less money. Windows on such scanty hardware is a pretty rough experience. Chrome OS on tiny machines isn't so bad. And, for people who already only use their computer for Internet stuff, there are no benefits to the Windows experience and plenty of negatives. So, this isn't a situation of, "Why would I get a dinky little fake computer if it's only $50 less than a good computer with Windows?" It's more of a "Why would I spend more for a computer that is slow, clunky, has a bunch of crap I don't need/want only so I can use also-ran webmail, online docs, etc. when I can get the market leading stuff for less?" I dunno, really. I'm just trying to imagine this from the perspective of someone who didn't grow up in a world dominated by Microsoft, because that's the world we now live in. The world is now dominated by Google with Apple and Facebook as thought leaders on the periphery. Things are different now, and getting a computer with Windows on it just isn't a thing that (young) people care so much about.
        hyperpallium 12y ago
        I think MS's reaction will be interesting. When linux netbooks came out, they aggressively discounted Windows for them, fending off the linux threat from below. MS/intel already have some incredibly cheap tablets (and Windows 8.1 reportedly runs well on them). Seems logical that MS will discount again. All they have to lose is everything.
        SwellJoe 12y ago
        That was an interesting, and scary, wielding of their power actually. I'm happy they don't have quite that much power anymore. The reason I say it was scary was that it was a moment in time where you could watch a class of computers from one generation to the next get worse because of limits imposed by Microsoft on OEMs. I bought a Dell Mini 9 just before they switched to the Mini 10. The Mini 10 actually had half the memory capacity of the Mini 9 (1GB vs 2GB in the Mini 9), because Microsoft defined "netbook" to have a maximum memory size and CPU power, which was lower than what netbooks had already climbed up to. Microsoft didn't want to see their margins decrease on "real" computers, but didn't want to cede the low end market to Linux. They saw the power of cheap then, and will probably see the power of cheap now. The difference is they don't have enough clout with enough manufacturers to dumb down these small computers. So, yeah, I'd be surprised if they don't respond. They already have very low cost Windows Phone licenses in order to compete with Android (but it's not really working). Honestly, I believe we're entering a post-Microsoft world, even on the desktop. It'll be five or ten more years before Windows is no longer commonly seen, but it's already not really a foregone conclusion that computers should have Windows on them.
      - eli 12y ago
        These things are only obvious in retrospect. Why did the iPod create a new market when the Nomad MP3 Player already existed?
        hyperpallium 12y ago
        I agree Christensen often seems a bit post hoc, but I think at least trying to see if there's a new market can help (as opposed to attacking the fortified hill of an established market). One could argue the Nomad's market was much smaller (most people who bought iPods had never heard of it), partly because of Apple's aggressive advertising... which certainly helps "create" a market.
        millstone 12y ago
        In the case of the iPod, the answer is surely the iTunes Music Store, which was the first legal online store that sold popular music in digital formats.
        DanBC 12y ago
        No it wasn't. Here's an article from 1999 about a variety of digital music distribution. http://www.soundonsound.com/sos/feb99/articles/netnotes.559.htm http://www.soundonsound.com/sos/feb99/articles/netnotes.559....
      - hyperpallium 12y ago
        That wiki's definition is simpler than I'd thought possible. But a "new market" includes a new group of people (doing the same old thing), and the same people doing the same thing in a new way (e.g. people with landline phones using cell phones). Just in the comments here are mentioned: low-hassle machine for grandparents (which the HNer has to admin, who influences the decision); low cost and low hassle machine for school kids (which the school has to admin, an who decides); second or third backup machine; machines for the developing world; for people working mostly in chrome browser (which is faster than on Windows), which includes most of us, and some HN even dev in web IDEs. Cheaper + low-hassle + web-optimised also makes them attractive, to almost everyone.
ctz 12y ago
Well, just this week a purchased a HP Stream 7 Signature edition for £50 (~=$50). Microsoft is definitely in the market.
- bmsleight 12y ago
  £50 !=$50 £50 ~=$75 https://www.google.co.uk/search?q=50gbp+to+usd https://www.google.co.uk/search?q=50gbp+to+usd
  - ctz 12y ago
    For technology, the currency difference is almost entirely lost in poorer buying power and tax inclusive pricing. eg. a 5K iMac is 2499 USD and 1999 GBP. That makes it about 3000 USD. Using that basis, the £50 tablet would retail in the US at 60 USD.
- newsreader 12y ago
  I got one for my wife about a month ago. Paid about $100 dollars for it, she uses it almost every day for email, Facebook, and browsing the internet.
melling 12y ago
I agree. Microsoft should ignore this because there's no money in it. Still, it's nice that a couple billion new people will be able to afford their first computer.
- zer0rest 12y ago
  it's an awful computer
  - deleted 12y ago
    [deleted]
- 72deluxe 12y ago
  Yes, but it's a tethered computer with a dependency on a mainframe. Do these poor people that this device is targeting also have sufficient money to pay for constant network access? The total cost of ownership for one of these suddenly becomes very high when you factor that in.
tluyben2 12y ago
I have a few $300 Windows 8.1 machines and although they might have objectively better hardware, my Chromebook is nicer to work with. It feels a lot less flaky than some of the Asus and Acer $300-350 machines with Windows imho.

SwellJoe 12y ago

Microsoft ate IBM and others from the bottom, because the margins were too low on PC vs mainframe and minis. And now, you're suggesting Microsoft should accept being eaten from the bottom because the margins are too low (I guess that's what you're arguing). Classic innovator's dilemma scenario. Those who don't learn from history will repeat it. Even those who made the history in question.

cardine 12y ago
What makes the Chromebook a disruptive innovation?
- austinsharp 12y ago
  It's cheaper and simpler with less functionality. Isn't that the broad idea [1]? [1] http://en.wikipedia.org/wiki/Disruptive_innovation http://en.wikipedia.org/wiki/Disruptive_innovation
  - cardine 12y ago
    A disruptive innovation is an innovation that creates a new market. What market does the Chromebook create that a $200 netbook didn't already create?
    - SwellJoe 12y ago
      Sometimes, all it takes to be disruptive is to be cheaper. "What market does the Chromebook create that a $200 netbook didn't already create?" I prefer to think we mostly find markets rather than create them, generally speaking. Chromebook may find a market in India or Africa or China. Places where a mobile device was everybody's first experience with personal computing, so the idea of it being intimately tied to the network isn't so strange. And, just as importantly, where $50 is a weeks wages so it seems a lot more important to spend 25% less on the device. I can see how me invoking Innovator's Dilemma here is possibly a stretch from some perspectives. Even if it is not disruptive innovation in the sense you prefer, it is still seeming more and more likely to continue to erode Microsoft's dominance in the places they have always been very, very strong: Cheap home PCs. Also, I think the argument could be made that this is a better product for less money. Windows on such scanty hardware is a pretty rough experience. Chrome OS on tiny machines isn't so bad. And, for people who already only use their computer for Internet stuff, there are no benefits to the Windows experience and plenty of negatives. So, this isn't a situation of, "Why would I get a dinky little fake computer if it's only $50 less than a good computer with Windows?" It's more of a "Why would I spend more for a computer that is slow, clunky, has a bunch of crap I don't need/want only so I can use also-ran webmail, online docs, etc. when I can get the market leading stuff for less?" I dunno, really. I'm just trying to imagine this from the perspective of someone who didn't grow up in a world dominated by Microsoft, because that's the world we now live in. The world is now dominated by Google with Apple and Facebook as thought leaders on the periphery. Things are different now, and getting a computer with Windows on it just isn't a thing that (young) people care so much about.
      - hyperpallium 12y ago
        I think MS's reaction will be interesting. When linux netbooks came out, they aggressively discounted Windows for them, fending off the linux threat from below. MS/intel already have some incredibly cheap tablets (and Windows 8.1 reportedly runs well on them). Seems logical that MS will discount again. All they have to lose is everything.
        SwellJoe 12y ago
        That was an interesting, and scary, wielding of their power actually. I'm happy they don't have quite that much power anymore. The reason I say it was scary was that it was a moment in time where you could watch a class of computers from one generation to the next get worse because of limits imposed by Microsoft on OEMs. I bought a Dell Mini 9 just before they switched to the Mini 10. The Mini 10 actually had half the memory capacity of the Mini 9 (1GB vs 2GB in the Mini 9), because Microsoft defined "netbook" to have a maximum memory size and CPU power, which was lower than what netbooks had already climbed up to. Microsoft didn't want to see their margins decrease on "real" computers, but didn't want to cede the low end market to Linux. They saw the power of cheap then, and will probably see the power of cheap now. The difference is they don't have enough clout with enough manufacturers to dumb down these small computers. So, yeah, I'd be surprised if they don't respond. They already have very low cost Windows Phone licenses in order to compete with Android (but it's not really working). Honestly, I believe we're entering a post-Microsoft world, even on the desktop. It'll be five or ten more years before Windows is no longer commonly seen, but it's already not really a foregone conclusion that computers should have Windows on them.
    - eli 12y ago
      These things are only obvious in retrospect. Why did the iPod create a new market when the Nomad MP3 Player already existed?
      - hyperpallium 12y ago
        I agree Christensen often seems a bit post hoc, but I think at least trying to see if there's a new market can help (as opposed to attacking the fortified hill of an established market). One could argue the Nomad's market was much smaller (most people who bought iPods had never heard of it), partly because of Apple's aggressive advertising... which certainly helps "create" a market.
      - millstone 12y ago
        In the case of the iPod, the answer is surely the iTunes Music Store, which was the first legal online store that sold popular music in digital formats.
        DanBC 12y ago
        No it wasn't. Here's an article from 1999 about a variety of digital music distribution. http://www.soundonsound.com/sos/feb99/articles/netnotes.559.htm http://www.soundonsound.com/sos/feb99/articles/netnotes.559....
    - hyperpallium 12y ago
      That wiki's definition is simpler than I'd thought possible. But a "new market" includes a new group of people (doing the same old thing), and the same people doing the same thing in a new way (e.g. people with landline phones using cell phones). Just in the comments here are mentioned: low-hassle machine for grandparents (which the HNer has to admin, who influences the decision); low cost and low hassle machine for school kids (which the school has to admin, an who decides); second or third backup machine; machines for the developing world; for people working mostly in chrome browser (which is faster than on Windows), which includes most of us, and some HN even dev in web IDEs. Cheaper + low-hassle + web-optimised also makes them attractive, to almost everyone.

ctz 12y ago

Well, just this week a purchased a HP Stream 7 Signature edition for £50 (~=$50). Microsoft is definitely in the market.

bmsleight 12y ago
£50 !=$50 £50 ~=$75 https://www.google.co.uk/search?q=50gbp+to+usd https://www.google.co.uk/search?q=50gbp+to+usd
- ctz 12y ago
  For technology, the currency difference is almost entirely lost in poorer buying power and tax inclusive pricing. eg. a 5K iMac is 2499 USD and 1999 GBP. That makes it about 3000 USD. Using that basis, the £50 tablet would retail in the US at 60 USD.
newsreader 12y ago
I got one for my wife about a month ago. Paid about $100 dollars for it, she uses it almost every day for email, Facebook, and browsing the internet.

melling 12y ago

I agree. Microsoft should ignore this because there's no money in it. Still, it's nice that a couple billion new people will be able to afford their first computer.

zer0rest 12y ago
it's an awful computer
- deleted 12y ago
  [deleted]
72deluxe 12y ago
Yes, but it's a tethered computer with a dependency on a mainframe. Do these poor people that this device is targeting also have sufficient money to pay for constant network access? The total cost of ownership for one of these suddenly becomes very high when you factor that in.

tluyben2 12y ago

I have a few $300 Windows 8.1 machines and although they might have objectively better hardware, my Chromebook is nicer to work with. It feels a lot less flaky than some of the Asus and Acer $300-350 machines with Windows imho.