What's Next For Google's Laptop: The Chromebook

NEW YORK (TheStreet) -- Google (GOOG) has been in the laptop PC market for over two years, but it was only in late 2012 that the broader media started paying attention. Coming this November, Google will turn up the Chromebook PC heat a couple of notches.

Back in October-November 2012, Google launched $199 and $249 laptops together with Acer and Samsung. These became bestsellers on Amazon for months to come, even though very few -- if any -- absolute or reliable overall sales numbers for Chrome OS PCs have been made public.

In early 2013, Google expanded the Chromebook portfolio with HP ( HPQ), Lenovo ( LNVGY) and its own flagship Pixel laptop. They were all more expensive than the $199 and $249 Acer and Samsung models.

Since then, things have gotten quiet on the Chromebook hardware front. The less expensive Chromebooks have displays of modest quality, hardly competing against higher-resolution or touchscreen ones from Apple's ( AAPL) and Microsoft's ( MSFT) partners.

On the high end, the Chromebook Pixel has a fantastic screen and a great build quality. However, it gets very warm and the battery life is terrible at four to five hours on the best of days. Then mix it with the high price starting at $1,299 and it probably isn't selling well.

Meanwhile, in the last couple of months, Apple has launched fantastic laptops with 10 hours of battery life. As for Microsoft, the new Windows laptops have touchscreens, new Intel ( INTC) CPUs with improved battery life, and many innovative laptop/tablet convertible form factors. The much-improved Windows 8.1 is only two months away, together with surely even more improved hardware.

With that as a background, what is Google to do with its Chrome OS laptops?

The answer is that around late October Google will launch a new set of laptops, together with many of its hardware partners, that will be available in November.

Here is what's going on:

1. New Intel CPUs. The Chromebooks to date are using what are now dated CPUs. Arguably, Chrome OS doesn't require much CPU power, but they could always use improved battery life. Expect the new Chromebooks this November to have better CPUs.

2. ARM. Samsung sells its $249 Chromebook with its own ARM ( ARMH) CPU, which it also uses in some smartphones and tablets. The major benefit with this device is that it runs so cool that no fan is necessary, just like it's not necessary when used in smartphones and tablets. This seems like a most fruitful approach, which should be continued. Samsung clearly has a winner here.

3. AMD and Nvidia? Given the success of Intel and ARM in Chrome OS, why shouldn't Advanced Micro Devices ( AMD) and Nvidia ( NVDA) get involved as well? Chances are that they will -- some day. It may not be part of the November 2013 batch, however.

4. Touchscreens and higher resolution. One major goal for Google is to take the superior touchscreen and high 1700x2560 resolution of the Pixel flagship laptop, and bring it to less expensive laptops with better battery life.

5. New form factors. One major benefit of a touchscreen is that with the right mechanical engineering, you can make it into a convertible tablet. This in turn requires finger-friendly software in order to be more useful. Expect this to be a major project for Google over the coming months.

6. New Chrome OS partners. It started with Samsung and Acer. HP and Lenovo followed, as well as Google's own hardware. Given the success to date, expect Asus and potentially the other leading laptop PC players to follow.

Here are the major kinds of models I expect to be announced this late October, and available in November:
  • Improvements at the $199 price point: The $199 Acer is a simple conversion from a basic Windows laptop. It could be more optimized for the Chrome OS, and use the savings for a better display -- although of course not touchscreen at this price.
  • Samsung improving its $249 Chromebook: This is in many ways the most interesting Chromebook because it is the lightest one and, most importantly, the only one without a fan, so it runs cool all the time. However, the chassis flexes a lot -- dangerously so -- and the screen is mediocre, even though it is matte. With a more rigid chassis and a brighter display, it would be a winner.
  • Asus convertibles: Asus has been particularly strong in tablet/laptop convertibles, and could take a lead in this new form factor for Chromebooks.
  • Bridging the $450 to $1,300 gap: $1,300 (and up) for a Chromebook is a very tough market proposition, but perhaps $500 to $600 wouldn't be? There is plenty of room for somewhat premium-ish Chromebooks at $500 to $600 that would satisfy those who have become hooked on Chromebooks, but who would never dream about paying over $1,000 for one. Even at $500, the battery life would have to be excellent at around 10 hours or more.

Conclusion: What's the meaning of Chromebooks?

For every Chromebook sold, business is taken from Microsoft and Apple. Most people -- not all, but most -- have no need for the complexity of a Windows PC or Mac.

Even sales of tablets -- primarily iPads -- are lost to Chromebooks. Some schools find that a Chromebook is more productive than any tablet, as well as a lot cheaper to maintain than iPad.

A lot of attention is being given to the epic Android vs. iOS fight, with Microsoft Windows Phone being the distant ankle-biter -- and for good reason. The handheld area is where the largest unit growth has been in the overall computing market. However, the PC desktop-laptop market remains a big business, and is part of Microsoft's and Apple's overall ecosystem glue.

With Google's increasing pressure on the PC market, more attractive Chromebooks can only serve the purpose of weakening Apple and Microsoft. This is a great time to be Google -- just wait until November and you'll see the new products.

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

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

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