Netbooks In SMBs: Still Waiting For A Killer App

Netbook sales keep growing, but businesses of all sizes are still struggling to figure out what the heck to DO with them.
Netbooks keep on selling but businesses still have little clue how to harness the power of the diminutive, inexpensive computers.

This point was brought home to me once again as I reviewed HP's Mini 5101 netbook, which the company pitches as a "Business Netbook." The machine raised as many questions as it answered:

  • Just what does it mean to be a business netbook?
  • Are businesses really buying netbooks?
  • What are businesses, of all sizes, doing with the netbooks they have?
  • Are they getting benefits out of them?

Just like these questions, netbooks aren't going away. A recent study by NPD's DisplaySearch says netbook sales were up 264% percent in the 2nd quarter of 2009, compared to a year earlier.

Don't Miss: Review: HP Mini 5101 Is A "Business Netbook"

But are they finding homes in businesses? After months of looking, I've found very little data on how many of those netbooks are going into business settings. One reason might be that with sub-$500 price points, organizations may be slipping in a few netbooks under the radar as operational expenses, without intruding into capital budgets.

The best data point so far is a recent InformationWeek Analytics survey that reveals 36% of respondents already use netbooks in their organizations, and that figure grows to 72% of companies within 2 years. But only 9% currently have extensive use of netbooks, and that figure doesn't even hit 20% in 2 years.


Those numbers jibe with a recent Chadwick Martin Bailey study noted in a Christian Perry story in, where a majority of IT decision makers said "netbooks could find a home in their organizations for employees who travel or require mobility services. On the other hand, only a small number of respondents said they would deploy netbooks on a wide scale."

It could just be that we're earlier in the adoption cycle. quotes Rob Cheng, CEO and co-founder, PC Pitstop:

"It is still early in the market development of netbooks, but we believe that the prospects in the enterprise environment are strong. Our research shows that netbook adoption in business is significantly behind that of the consumer market. However, the factors driving netbook adoption [in the consumer space] will be the same ones that drive the corporate acceptance. Netbooks are the perfect combination of great price and portability. It is not the solution for all corporate needs, but ultimately, netbooks will establish a strong position in companies that use laptops for travel and communication purposes.”

In another piece, Perry quotes Frost & Sullivan analyst James Brehm connecting the adoption of cloud computing and netbooks:

“In this instance, netbooks are a good, almost perfect solution. Second, for jobs that don’t require a lot of mathematical computations [or] database or spreadsheet activity, netbooks are a fine solution. Third, because of the price point, netbooks are almost a disposable solution when compared to ruggedized or semi-rugged notebooks.”

Ironically, netbooks' very limitations could make them attractive to businesses. In a recent InformationWeek Analytics report -- The New Option: Netbooks Challenge Notebooks’ Dominance -- author Mike Healey said: "Call us heartless, but if a netbook can stream a video, work on Office documents, and get on the Web, who cares if it can't serve as a backup site for a user's Nirvana bootlegs," adding, "Can we get an 'amen' for productivity gains?"

Healey also suggests that businesses might be able to use netbooks to replace pricey e-mail and data access functionality on smartphones, relying on free Wi-Fi connections instead. An interesting idea, perhaps, but I have yet to hear of any company doing that. Notebooks are simply not as accessible as smartphones in many situations.

Meanwhile, another entry point for netbooks into businesses could be those companies -- like Citrix Systems -- that have BYOPC (Bring Your Own PC) policies.

Or maybe it's just a matter of positioning: Don Ryan, vice president of technology and media for TNS North America told, "Until HP and Dell decide that a netbook fits into an enterprise environment, the market will be slow to take off in this segment.”

As noted above, that's already starting to happen with devices like the HP Mini Note 5101.

Despite all the rhetoric, it seems pretty clear that the vast majority of netbooks are still being sold into consumer applications. For now, businesses seem to be buying netbooks mainly as test units or for niche uses based on the need for extreme portablity or cost considerations. Popular niches include military and police forces, and especially education. After all, those kids still have keen eyes and small fingers -- perfect for netbooks' tiny screens and cramped keyboards!

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