Is EEE killing the PC industry?

and is it its future?

I was talking with a good friend this morning and he wasn't aware of the EEE family, the B20*. These netbooks, sub $200 PC are all the rage with aficionados.

And what is not to like with specs like 1.6Ghz, 1gig, 160gHDD, Wifi N, HDMI so on and so forth, oh and i did I mention they retail for less than $200? The NYT has a good article this morning on the impact of these little beasts. It basically claims that it breaks the traditional PC business model.

Mr. Title, a 35-year-old new-media manager at a film production company in New York, has dropped his cable subscription and moved to watching most of his television online — free. While shopping for a new laptop for his girlfriend recently, he sidestepped more expensive full-featured computers and picked a bare-bones, $200 Asus EeePC laptop, also known as a netbook.

“We’ve reached one of those moments in tech history when there are low-priced and free alternatives that are both user-friendly and reliable enough to make the switch,” Mr. Title said. “Then there’s the extra bonus of saving some cash.”

For Open Remote, I already blogged about the EEE and how we plan on offering support for it as a base controller (although we are looking at even smaller models based on Alix). Juha is in Taiwan and he has ordered the touchtop, we are looking into using the touch top, the one with a touch screen, as a natural wall-panel to replace $7000 equivalents.

The chip is Intel Atom, which ironically is killing... Intel. Neither Intel nor Microsoft are structured to address the market of $200 PC, or are they? A part of me wants to believe that if they are marketing these things it is because they can, meaning they make a profit. Another part of me believes they are marketing these things because they have no other choice.

In retrospect it seems kind of obvious that the CPU Mhz race would eventually tap out. It tapped out at the 1Ghz barrier. Anything above is just wasted cycles and heat. 99% home usage out there does not require more CPU power. CPU is not where your ego is at anymore. The fact that the box can run 1080p HDMI (see below) is where it is at. Of course the niche-gaming or the IT farm (thank you java!) will still require some power, but I think it is safe to call it the end of the PC era. It died 6 mo ago.

Moore's law, that the chips would double in power or half in price every 18mo, was once what made the industry tick. While the power hunger wasn't met, the chip makers kept doubling the power keeping the price, and their business models, steady. Now the industry is faced with the dire prediction that their revenue will halve every 18mo. Unless volume doubles every 18mo, the industry is in for some horrendous pain.

The traditional PC industry is hosed.

PS: check this out and tell me it is not the ideal HTPC. Storing your DVD collection on one of these?