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Google's $249 Laptop: Can It Really Hurt Apple?

Stocks in this article: GOOG MSFT AAPL

As Wahlman does explain, you will not be able to run programs such as Skype and Photoshop or any software outside of the Chrome platform on this thing. However, he glosses over these limitations.

Chromebook is a tablet with a keyboard -- nothing more, nothing less. It doesn't "compute" as much as it lets you "surf the Web," check email and process words in Google Docs. Try keeping multiple tabs or windows open while running a YouTube video. Luckily, the machine will only cost $249 to replace after you chuck it out your window in frustration.

A CNET review provides what is probably a more realistic take.

CNET notes, among other things, that the Chromebook's touchpad doesn't come close to Apple's. It also points out that due to "its sluggish performance sometimes," Google's $249 laptop isn't for "power users accustomed to having more than a couple dozen browser tabs open" at one time.

My kid and my 65-year old mother must be power users then! (AMZN) gets ripped for breaking even on Kindles. But I can't imagine Google is making mad margins on these low-end laptops. So, what's the point then?

Amazon does what it does to drive hardware buyers to its wide-ranging e-commerce ecosystem. For the time being, Google generates nearly all of its revenue from advertising. This cheap computer will minimally further that cause, if at all.

If this is a humanitarian effort by Google, I appreciate the intent, but it will fizzle on those grounds as well.

I don't see families living in poverty in Los Angeles, let alone, Somalia, running to the Google Website or elsewhere to shell out $249 plus tax for a computer.

Google will not do to Microsoft and Apple what Amazon and Walmart (WMT) did to record and bookstores. Nor will it even replicate Dollar General's (DG) negligible impact on Walmart.

This focus on price and "copying" Apple's Macbook Air should trigger worry for consumers and investors.

A few days ago, Google Chairman Eric Schmidt argued that a recent hallucination he had -- the perceived battle between Apple and Android -- will drive prices down, making things better for us non-millionaire peasant consumers.

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