Dell Joins Netbook Race to Bottom

There are two schools of thought about netbooks. The first is that they are simply another kind of notebook - smaller, a bit cheaper, but otherwise nothing really new. The second is that they are a completely new market sector - a view that I have been propounding for almost as long as they've existed

One indication that they are distinct is that the prices of netbooks are still falling rapidly - and will continue to fall. That's in contradistinction to notebooks, where prices tend to be much more stable, but features are added over time. The netbook is about *minimum* acceptable functionality, while notebooks are about achieving near-desktop capabilities (themselves constantly improving) in a package that's portable.

Here's another proof-point:

Dell fires back at the Taiwanese market leaders with the Mini 9n. Starting at just $250, this Ubuntu netbook is easily one of the cheapest on the market from a brand-name manufacturer.

The catch? The netbook only comes with 512 MB of RAM and a 4 GB hard drive. But remember it uses Ubuntu, which runs significantly more efficiently than Windows. This means of course that it can only run Linux programs but give me Firefox and Open Office and I can conquer the world.

This is just what notebook manufacturers fear: a "race to the bottom", as Sony so memorably put it. Dell's participation in that race will send shivers down the spine of manufacturers who thought they could ride the netbook wave with their low-end notebooks.

Do I hear $200?