Sunday, March 9, 2008

On The Significance Of The Asus Eee PC

For several months now I have been thinking about the new Eee PC from Asus. In case you haven't heard, the Eee PC is small Ultra-Mobile PC (UMPC) weighing about two pounds, and costing less than $400. So far, the product has been, according to many sources, a runaway success. For me, of course, the important fact about the Eee PC is that it ships with an easy-to-use Linux OS rather than that other operating system.

While one could certainly dismiss the device as an underpowered little toy running an unpopular OS - and there are those detractors - that would be missing the point.

For those of you who have read The Innovator's Dilemma, by Clayton Christensen, you will at once recognize the Eee PC as a "disruptive technology," for it defines an entirely new class of product that expands the laptop market into the new territory of the "portable Internet device." As Christensen observed regarding disruptive technological change,

"Generally disruptive innovations were technologically straightforward, consisting of off-the-shelf components put together in a product architecture that was often simpler than prior approaches. They offered less of what customers in established markets wanted and so could rarely be initially employed there. They offered a different package of attributes valued only in emerging markets remote from, and unimportant to, the mainstream."

Think about the laptop computer market. With all the laptops available today, what's the real difference between them? Aside from a few different screen sizes, nothing. In fact, the problem of product differentiation has gotten so dire that manufacturers are now promoting case colors and textures to make their products seem different from their competitors.

Why is that? Why are all laptop computers basically the same? It's because they are all designed to run only Windows.

While MS-DOS and its decedents, along with the PC BIOS vendors, are responsible for creating today's market of ultra low-cost commodity hardware, they have also created a trap for manufacturers. As a manufacturer, the last thing you want is to be in a commodity market. In a commodity market, the only thing you can compete on is price, which is brutal. What you want is to have a product that is different, a product that can command premium pricing. Apple understands this and that's why you can't buy OS X for commodity PC hardware.

As Asus has demonstrated, once you are not tied to Windows compatibility, you can create new, exciting, and innovative products. But why is Windows a trap? Because it lacks freedom. Freedom gives you control. Whereas a manufacturer using Linux can customize the OS to fit whatever hardware design fits their vision of the market, with Windows they are given a simple choice: "take it or leave it." Where is the freedom in that choice?

Asus is also teaching the industry a lesson that in order to be successful with Linux, you have to treat it seriously. Much of the Eee PC's success can be traced to the work Asus did developing a well thought out user interface for its product. Contrast this with the Everex Cloudbook and the various attempts Wal-Mart has made with desktop Linux machines. If you put a junk Linux installation on your low-cost hardware, you get a junk product. Even Dell, whose Ubuntu systems created such excitement in the Linux community, has failed to take advantage of the opportunity that Linux provides. Rather than create a new kind of computer (that isn't forced to meet the hardware requirements for Windows) and crafting a Linux distribution that fully exploits its unique attributes, Dell settled for installing an existing (albeit high-quality) Linux on an existing laptop. This guaranteed that it could be no better than an "almost as good as Windows" computer.

I hope that the industry reflects long and hard on the significance of the Asus Eee PC, as I long for the day when a steady stream of meaningful innovations makes the computer industry exciting again.