HP's First Chromebook: The Tesla of Laptops

NEW YORK (TheStreet) -- I'm typing this review on Hewlett-Packard's (HP) divorce papers from Microsoft (MSFT).

For thefirst time, HP has launched a laptop based on Google's ( GOOG) PC operatingsystem, Chrome OS. It's a wonderful 14-inch laptop priced at $300with no expensive add-on gimmicks. You should buy one.

Before I get into the review, I have to set the stage for why this ishappening. Why is HP no longer exclusive with Microsoft's Windows PCoperating system?

It all starts with CEO Meg Whitman. When she assumed the role as CEO,there were many fires to triage. Many things were aboutorganizational management, balance sheet optimization -- frankly,firing layers and layers of fat. Blocking and tackling.

Ultimately, though, getting in shape physically doesn't help you winthe race if you're running in the wrong direction. You need to berunning in the right direction; you need to be on the right technologybandwagon.

Whitman did what I did: Go sample the 16 cafes closest to the HPheadquarters. This is Stanford and Facebook ( FB) territory, folks. Sheprobably saw what I saw: Almost everyone was using Apple ( AAPL) laptops --almost nobody was using Microsoft Windows PCs.

Oh well, there was one: He was in a suit. Turns out he was someaccountant-banker-consultant type visiting from New York. For allI know, he may have been working on HP's now-defunct old PC strategy:Typing on his HP Windows laptop wearing a conservative suit, he stoodout as if he were wearing a turban and pink dress in an Amarillo, Texas,Baptist church.

Whitman saw what I saw: The younger demographic has already left WindowsPCs, and they are all using Apple MacBooks. No matter what she woulddo to perfect working capital management or cutting a middle managerlayer, this cost-cutting would do nothing to the Windows PC revenuedecline that is secular in nature.

Then she went to her neighbors in Palo Alto. Tim Cook won't licensehis Mac OS to HP -- or anyone else. Larry Page and Sergey Brin,however, were more than thrilled to help Whitman see a new light in HP'sPC tunnel. So they licensed her their beloved Chrome OS.

But what future is there in Chrome OS? Isn't Microsoft Windowsdominant? Chrome OS is now in 3,000 U.S. schools, and the entire publicschool system of Malaysia. As Lenin said, if you catch them while they're young they'llbe loyal party members.

Windows 8 is a fine product, the soon-to-arrive Windows 8.1 will bemuch improved and HP will be offering a full line of Windows productsfor many years to come. That said, for HP to start down the Chrome OSpath is a milestone. When Apple launched iOS in 2007 to augment theMac OS, was it significant? Of course not. Did it become significantwithin a few years? You betcha!

The First HP Chromebook

It looks almost identical to any of HP's cheaper Windows laptops thatyou would pick up at Best Buy ( BBY) or equivalent. It's black plastic thatwins the General Secretary Leonid Brezhnev award for never making it near theMuseum of Modern Art.

Black plastic is, however, durable, light and not as slippery asmetal. I really don't care what it looks like as long as it'spractical. So for me the HP Chromebook feels great, especiallyconsidering the bargain $300 price.

The screen is 1366 by 768, and it's not touch -- unlike the 2560x1700touchscreen Google Pixel for $1,000 more. It's also too dull for mytaste; it needs to be be brighter, just like the Google Pixel. Butit's just fine for basic productivity. As I said, I'm typing thisreview on it.

The keyboard is okay, but not great. Apple, Samsung and Google itselfhave slightly better keyboards. When it comes to the trackpad,though, the differences are greater. This small trackpad with twobuttons reeks of old Windows cheap stuff, and it doesn't hold a candleto Apple, Samsung and Google. Even after a week of using it, it keptslowing me down.

With three USB ports, one HDMI and one wired Ethernet, the HPChromebook has plenty of ports. The battery is tiny, but removable.I never got it to last more than four hours typing my articles. Itneeds to be at least 50%-100% larger.

Furthermore, this first HP Chromebook lacks LTE. I normally use LTEall the time because I'm paranoid about using WiFi. For this reason,I had to connect this laptop to my smartphone's LTE modem instead ofconnecting it directly to AT&T ( T), Verizon ( VZ), T-Mobile or Sprint ( S).

The CPU speed and fan noise were both perfectly fine. It's quiet as a Tesla ( TSLA) and whip-snap fast for basic productivity. There is nothingwrong with the performance of this HP Chromebook -- other than theobvious lack of advanced gaming capability. Then again, I work -- Idon't play games or watch Netflix ( NFLX). I type articles; I don't editphotos or pretend to be a DJ.

When you consider the $300 price, you have to realize that it doesn'tcompare to a $300 Windows laptop -- or for that matter a $1,000MacBook. When you buy the HP Chromebook, the bottom line is $300. Incontrast, when you buy a Windows or Mac, you may be buying additionalsoftware or warranties, costing you many hundreds of dollars.

With the HP Chromebook, you are likely using Google Docs/Drive --which is free. Also, other than those "one in ten thousand" hardwarefailures, you should have no reason to troubleshoot it. So there isno reason to buy a warranty or ever visit a store to deal with acomputer issue. This will save you thousands of dollars, hundreds ofhours and lots of headache over the computer's life.

In other words, just like a Tesla.

Where should HP go next with its Chrome OS devices? Let me offer HP some advice:
  • Create a product family. One 14-inch laptop is good, but alsolaunch 12-, 13- and 15-inch models, plus a desktop PC and all-in-onePCs.
  • Improve the keyboard and try to match the trackpads from Apple,Samsung and Google.
  • Offer models with embedded LTE for those of us on the road orparanoid about security.
  • Increase the size of the battery so that it is at least six to eight hours,preferably 10+.
  • As soon as Google is ready, HP needs to be the first to offer theChromephones and Chromepads I described in these two articles on Tuesday and yesterday.

If HP makes a name for itself as the "go to" device maker for ChromeOS, whether on the PC or on the tablet (Chromepad) and smartphone(Chromephone), it could have the kind of epic run Dell ( DELL) had in the PCbusiness 25 years ago, or that Samsung had in the Android market overthe last two years, when it grew to become the market leader in abrand new market, with hundreds of millions of units sold.

What should HP avoid in its Chrome OS strategy? Follow a cue fromDell and Samsung, again: Avoid clothing your Chrome OS-based PCs,tablets and smartphones in metal encasings. They are pretty but theyare also heavy, expensive and slippery.

Inspired by Tesla, Whitman Is With the Times

Like Elon Musk, Meg Whitman is taking a mature industry by the hornsand moving to where the younger generation is going: Microsoft Windowsis out, Chrome OS is in. HP's first Chromebook boots in a couple ofseconds, updates automatically over the air, operates silently andrequires no maintenance -- just like a Tesla.

It will take years for HP to be awarded Tesla's stock multiple, butWhitman has listened to the advice from her neighbors -- Brin, Page and, of course, yours truly, who has been writing this Chrome OScolumn since December 2010. She will not allow her PC business tocontinue to drift down together with the secular shift away fromWindows PCs.

In this quest, the 14-inch HP Chromebook for $300 is a solid firstoffering, just like the Tesla Model S is a first shot at reshaping theautomotive industry. It's a bold move, and after one week ofaround-the-clock use, I endorse this product with a strongrecommendation.

As with Tesla, once you buy the product, you will see why would youshould also consider buying the stock. It's that good.

At the time of publication the author was long GOOG and AAPL..

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

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