Linux not essential to Eee PC success: ASUS

They’re tiny they’re portable and they’ve rewritten the rules in the traditionally feature-heavy notebook market. Despite years in which Linux has been ignored by mainstream notebook makers Linux-based mini-notebook PCs drove a spike in sales during 2007 that suggest the operating system could finally be hitting the mainstream.

Or could it?

Love it or hate it most of us know how to use Windows to do what we need. That makes the love-to-hate-it operating system a functional baseline for many. And for all its functional and usability improvements so far Linux based mini-notebooks are still riddled with everyday usability differences and compatibility issues that could very well sink their chances of long-term success.

Linux made easy?

Designed with a custom tabbed interface that simplifies access to the systems’ key functions the custom-designed distributions running Asustek’s ASUS-branded Eee PC and its closest rival the Acer Aspire One have done wonders in countering the opinion that Linux is an operating system only a die-hard geek could love.

“Linux does a great job and can be customised to work in a certain fashion” says Henry Lee Acer’s senior product manager for the Oceanic region. “This makes it very intuitive for new consumers or the younger generation to start using it.”

The devices put the most popular functions – including productivity tools Skype Internet radio and other features – at users’ fingertips. Testing has confirmed they are easy and intuitive even for primary school students. This is a big score for a product category that grew out of efforts such as OLPC (One Laptop Per Child) and Intel’s Classmate PCs and broader Netbook initiatives for low-cost portable computing.

While the inclusion of Linux has helped vendors customise their systems and set a sub-$500 price that’s resonating with consumers those more subtle differences become evident when users take even small steps outside the sandbox the vendors have created.

Adding new applications for example is far less intuitive in Linux than in Windows for novices who will be rightly lulled into a sense of familiarity with the prettied-up menus. Built-in functions for adding applications to the Eee for one show a frustratingly sparse selection of options culled from the built-in repository of Eee software maintained by Asustek.

Finding new applications to add requires users to add new repositories a process that is likely to send curious Linux novices deep into a pit of frustration. Even if they figure out the difference between Multiverse and Universe and manage to add repositories for Debian and Xandros (on which the Eee’s Linux is based) users overjoyed by the newfound selection of software are likely to throw hands in the air when the software they install fails to work or even stops the system working properly.

Online forums are replete with warnings not to assume Debian or Xandros software will work on the Eee and finding out which applications will work and which will not requires extensive Googling. This is not to say that nothing works on the Eee or Aspire One (based on LINPUS Linux Live a low-footprint distribution based on Fedora) – just that your average Linux novice isn’t going to know how to tell the difference.

Even worse a single mistake can cripple a system to the point of being unusable. “It’s very very easy for a careless install to brick your Linux system” says one hobbyist.

“The little Acers can lead you into hell on earth. I’m still struggling with sound having had to switch distributions to get wireless to work. To try to cure a trackpad sensitivity issue I installed Synaptics [trackpad] drivers under OpenSuSE. The machine would start but because the driver changed an X configuration file it would not load the graphical desktop. I managed to restore this without re-installing but it was difficult and very painful.”

Contemplate explaining Synaptic repositories to your parents or your young children and the Achilles’ heel of the new devices becomes evident: they work fine as advertised but any changes are at your own risk. If you recommend one of these units to family or friend count on spending lots of long nights helping them get the devices set up the right way – and cleaning up the mistakes they’ve made.

White-hot glow

The inclusion of Linux in the Eee helped Asustek push prices for new notebooks to remarkable new lows making the unit a runaway success: last year according to IDC the Eee singlehandedly accounted for nearly 3% of Australian computer purchases.

That’s a significant win for mini-notebooks a new class of ultra-lightweight devices that didn’t even exist a year ago. These days the devices are playing a major role in the growth of the PC market: overall sales increased 8.3% between the first quarter of 2007 and the same time this year and Eee sales boosted ASUS’ local market share from 8.1% in 1Q2007 to 11.8% in 1Q2008 according to IDC’s Quarterly PC Tracker figures.

Without the Eee that figure would have been closer to 9% according to Felipe Rego associate market analyst with IDC Australia who says the Eee accounted for 2.9% of all notebooks sold in Australia during the quarter.

What is so significant about this figure is not only its scale but the fact that the Eee is perhaps the first notebook model to enjoy mainstream success without running Microsoft’s ubiquitous Windows XP operating system.

“Asustek definitely created a growth area” Rego says. “These ultra low-cost PCs are going to be quite niche and a secondary type of device mainly for children or for browsing the Internet as opposed to actually producing content. There may be big opportunities in the education space. And from the Linux perspective it’s creating awareness by saying ‘this is actually easy to use’.”

Importantly Rego notes the Eee – which relied on the fact that Linux is free and used relatively low-specification equipment to keep prices under $500 – have been additive to the notebook market increasing overall sales rather than cannibalising sales of more expensive systems. This implies that many current notebook owners are buying Eees as secondary PCs.

ASUS sold more than 600000 Eee PCs last year and is targeting sales of 5 million this year as it expands its product line with models sporting larger screens and Intel’s new low-powered Atom processor. But whether its momentum can continue will be seen as new Atom-based competitors from rivals including Acer HP MSI and Pioneer pushing into the budget end of the notebook market.

Reality sets in

With the momentum is has already gathered could the Eee beat off its rivals to become the Holy Grail of Linux computing – that killer product that brings Linux into the mainstream?

Don’t bet on it says Hugo Ortega principal of Tegatech a distributor that handles the Eee alongside competing devices such as HP’s 2133 Mini-Note PC and ultra-mobile PCs (UMPCs) that run Windows XP and Vista and range well past the $3000 mark.

“The HP 2133s are outselling the Eee PC 20 to 1” Ortega says “and Linux only accounts for probably 20% of Eee PC sales and less than 5% of overall UMPC sales. The fact that there’s a $500 notebook out there is a big plus but we find most [buyers] are more than happy to use a license in their office to upgrade them to [Windows] XP.”

That the Eee is even selling Linux versions at all is a big coup: previous Linux-based UMPCs from Chinese manufacturer Beijing Peace East Technology were offered by Tegatech but ended up being withdrawn after “we had not one phone call on them” he adds.

Herein lies the vast difference between perception and reality which seems to be rapidly diluting the value proposition of Linux-based mini notebooks. ASUS and Acer may have overcome some users’ perceptions that Linux is too complicated or esoteric for mainstream use but mainstream demand has caught up with the units as customers shy away from Linux once again.

Indeed many manufacturers entering this class of notebook are doing so with Windows-only machines that seem poised to undo the Linux mindshare gains that the Eee made over the past year.

Consumers aren’t the only ones to blame: manufacturers and resellers must reconcile the devices’ low cost (and profit margins) with the often massive support costs that consumer-level devices can incur. Here again the reality is that while Windows may not be perfect it’s much better known than Linux.

Little wonder that Asustek recently revised its distribution strategy steering Linux-based Eee PCs towards resellers capable of providing more personalised support while pushing Windows-based Eees into mass-market retailers.

Acer which continues its commitment to Linux is likely to take a similar path. “It’s a give and take between simplicity of usage for the masses versus full customisation” says Lee. “The Linux version is really only to use exactly what is provided and someone in the know can easily remove what’s been installed. But consumers are accustomed to the Windows environment and the Windows version will be a stronger player eventually.”

Windows is not of course necessarily easier particularly on low-powered devices on which the infinitely-tweaked Linux is known for running more efficiently. Windows-powered mini-notebooks will need antivirus and other security software to run safely chewing up precious processor and disk cycles as well as potentially shortening battery life compared with the more frugal and secure Linux.

Windows the gate-crasher

These are minor points however compared with the widespread perception that Windows is easier to use than Linux. Although the Eee and its ilk have managed to put Linux in front of a mass-market audience Microsoft’s determination not to be left out of its space has sparked a massive assault that has quickly changed the dynamics of the market into which the new round of Atom-based devices is being launched.

Indeed despite the philosophical appeal faster performance and ease of use that these Linux machines provide the availability of a Windows alternative may have already started taking its toll as buyers opt for the more familiar option. “The bulk of the requests and requirements we see in the marketplace are for the model with Windows rather than Linux” Lee admits.

Microsoft’s efforts to push Windows XP into this space even after it terminated the operating system’s general availability on June 30 are reflected in the fact that XP-based Eee PCs somehow became $50 cheaper than their Linux counterparts. That price disparity has since been eliminated after Asustek bowed to critics who pointed out that the lack of Windows licensing fees – traditionally equivalent to around one-quarter the price of the entire system – should have more than made up for the cost of the expanded onboard storage in the Linux devices.

Even pricing parity however may not be enough to save Linux. As market expectations push the low-end machines towards having larger screens more storage and faster processors they will begin to resemble low-end conventional notebooks – potentially diluting the low-cost appeal that has driven their success.

Linux fans who saw the devices as low-cost and highly portable Linux workstations with a nearly infinite variety of uses can still buy the Windows devices for the hardware and install Linux on top but there seems little doubt the mass-market demand Linux-only devices will struggle to maintain itself.

“It’s going to be tough in the long term” for Linux-based mini-notebooks says IDC’s Rego. “Microsoft will play tough in this space where there’s a massive presence of Windows. We don’t have expectations yet for Eee sales of XP vs Linux but Linux definitely needs to create increased awareness. If you go into the mainstream people just want something easy that they recognise.”