Racing to the Bottom of Openness

Here's some interesting news about Barnes & Noble's e-reader:

The reader, named the “Nook,” looks a lot like Amazon’s white plastic e-book, only instead of the chiclet-keyboard there is a color multi-touch screen, to be used as both a keyboard or to browse books, cover-flow style. The machine runs Google’s Android OS, will have wireless capability from an unspecified carrier and comes in at the same $260 as the now rather old-fashioned-looking Kindle.

Linux-based: no surprise there. But this is:

And over at the Wall Street Journal, somebody got a peek at an at ad set to run in the New York Times this coming Sunday. The ad features the line “Lend eBooks to friends”, and this has the potential to destroy the Kindle model. One of the biggest problems with e-books is that you can’t lend or re-sell them. If B&N is selling e-books cheaper than the paper versions, then the resale issue is moot. And lending, even if your friends need a Nook, too, takes away the other big advantage of paper.

In fact, this loaning function could be the viral feature that makes the device spread. Who would buy a walled-garden machine like the Kindle when the Nook has the same titles, cheaper, and you can borrow? The Nook is already starting to look like the real internet to the Kindle’s AOL.

It's a classic "race to the bottom", where the bottom is total openness: see you there, Amazon.

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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?

Hardware's Race to the Bottom

I've written several times about the importance of the Asus Eee PC; here's another way of looking at it:

At Sony's annual Open House event, Sony's IT product division senior vice president Mike Abary said if the Asus Eee PC starts to do well, it could potentially shift the entire notebook industry into a race to the bottom.

If mainstream PC buyers start to find their needs met by a lightweight, simply featured, inexpensive portable, it's likely to impel all of the major players in the industry to pile on by lowering their prices.

This, of course, is precisely what open source has done to proprietary code, so it's interesting to see the same happening to hardware, again driven by free software.