A few days ago NPD released numbers that caused many media outlets to proclaim the amazing success of Chromebooks as a data point in the market. These numbers were bring used in blog posts to suggest that the rise of Chromebooks were impacting PC sales, and in particular Macs and Windows PCs. As so often happens, the media has mis-interpreted the data points released in a vague press release from a device counting and tracking agency. However, this press release is specifically talking about the commercial sales channel (i.e the channel used by organizations for purchasing) not the consumer retail channel like Best Buy, Staples, Fry’s, etc.
NPD is about as reputable of a US retail consumer electronics tracking firm of any I follow. In fact, I generally trust their data more than most. This is because NPD has relationships with all the major US retailers and gets actual channel sell through data. So when they release data we know that we are getting actual numbers of products being sold at US retail. However, we have to keep in mind that while their data is accurate it is also somewhat incomplete in some cases. NPD does not track Amazon sales, or other e-commerce sales, nor do they track Apple store retail sales or other OEM vendor channels. So while NPDs data is important and useful it is also somewhat incomplete. In most cases this doesn’t matter since the bulk of US consumer electronics is sold through retail channels which NPD tracks. While Apple does sell more than average product through their own retail channels they still sell the bulk through retail channels.
Now the story around Chromebooks has been a fascinating one to watch. Earlier in the year, we had picked up on a key data point that Chromebooks were selling almost as many per month as Ultrabooks. Ultrabooks were a specific segmentation of notebooks at retail which had quite a bit of marketing behind it. To learn that Chromebooks were moving in similar volumes to Ultrabooks did take me by surprise. So the question we had to answer was why.
Chromebooks as Textbooks
Earlier in the year I spoke at a conference of educators and IT managers that worked for the state of California and managed the technology purchased and implemented for all California school districts. What we learned was that education markets were buying and deploying Chromebooks in fairly significant numbers. Much of California’s, and many other states, computer programs and curriculum are web based. School districts have a license to education software that is accessed through a browser and teach things like computer literacy, language arts, math, and several other subjects. The bottom line, is that when you dig into many of the ways in which computer based curriculum has been evolving in school districts you learn that much of it is becoming browser based.
There are still many PCs still being used in schools, particular at more advanced grade levels, but many districts are implementing Chromebooks as dedicated web portals to online education software to be used in classroom settings.
This is not surprising given the cost of Chromebooks vs. the cost to replace or add new PCs during these times when many school districts across the US are facing budget restraints.
The key takeaway about Chromebooks in this use case is that they are being used a specific purpose devices. In fact, it is reasonable to think of Chromebooks very much like textbooks in many education environments.
While Chromebooks have a great deal of upside as they evolve, they are being used as specific purpose devices in nearly all markets today. This is both the potential of the upside but also the products challenge in going up against more general purpose computing devices.
Chromebooks has a role, but over the next few years whether its role is as specific purpose devices or general purpose applications will wait to be seen. Stay tuned, however, should Google release a tablet running Chrome OS things could get very interesting.
Still racking my brain over this concept of a ChromeOS tablet.
Google are actively building a Chrome ecosystem where you can code up an app using HTML5, CSS3, JavaScript and associated API libraries. Things like enabling voice input into a text dialogue box is less than 16 lines of JavaScript. Once built, you can do what iOS does in the sense of “save to home screen” – so your app appears on your UI as an icon like any other app, and when invoked, launches with a headless Chrome browser running in the background.
So, we end up with code that is written in a language stack known to millions, and yet which can run on Android, iOS, ChromeOS, Mac OS/X and indeed Windows platforms unmodified.
So, where does a ChromeOS tablet attain any relevance? The apps will be able to run on any device with a Chrome Browser in place already. Google are already anal about trying to modify any underlying location services code in Android (you are running the risk of being banished from the Open Handset Alliance if you try, as Samsung once tried), so any Android tablet today able to run Chrome will run the same apps. Instant On is not so relevant for devices like tablets that tend to be on standby all the time.
So, what could a ChromeOS tablet give you already that isn’t already served by Android tabs at a likely same price point? I can only think of 3 reasons:
1 – to reverse Google Play Services back into the Chinese Market
2 – to run on less capable hardware, with or without screens (Internet of Things OS)
3 – to support a business model where Google pay the OEM to use the OS
Or is there another more plausible reason for a ChromeOS tablet to exist?
Just thinking aloud – is the next moonshot the ability to hit a tablet price point where you could bolt them as a free giveaway on the front of a kids comic, or the plastic toy in a pack of breakfast cereal?
Just add a battery…
Or a TV. Think that’s called a ChromeCast (which I have, and which is fantastic).
I honestly think it is a bit more simple than any of those reasons. Google is losing the tablet market from a business standpoint. Android tablets are not being used in ways that make money for Google. Yet, browsing the web is a primary use case for tablets, particularly all those wifi only ones that are connecting mostly at home. Which is the majority.
So, why not launch and extremely low cost tablet <$100 perhaps, and position it as a simply web browsing mostly tablet for people to use to get online while watching TV or just an extra web only tablet around the house.
Then slowly as they develop more touch based web apps, the purpose of Pixel, then start opening up applications to the tablet which take advantage of touch and help consumers realize there are more apps than they thought that are supported in a tablet form factor.
Consider it more a trojan horse strategy from a tablet standpoint for Google. Right now, they are getting next to nothing from their own tablets. This has to be addressed.