Chromebooks sales will triple -- is Microsoft right to fear them?

A new report from Gartner forecasts that Chromebook sales will triple in the next three years and gain a small chunk of the PC market. Do they represent a real threat to Microsoft, or are they just a side show?

The Gartner report says in 2014, 5.2 million Chromebooks will be sold, up from 2.9 million in 2013, a gain of 79%. By 2017, the report says, Chromebook sales will almost triple to 14.4 million. Computerworld's Gregg Keizer says that means nearly 5% of all personal computers sold in that year will be Chromebooks, approximately the Mac's current market share.

Isabelle Durand, principal analyst at Gartner, explains the Chromebook surge this way:

"Now that the PC market is no longer growing strongly, vendors are searching for new business opportunities. They launched Chromebooks to revive interest in sub-$300 portable PCs once the netbook bubble had burst."

At the moment, Gartner says, Chromebooks have mainly been sold to the education market. However, Durand expects businesses to increasingly buy them as well:

"So far, businesses have looked at Chromebooks, but not bought many. By adopting Chromebooks and cloud computing, businesses can benefit; they can shift their focus from managing devices to managing something much more important -- their data."

Durand added in an interview with Computerworld:

"Microsoft should not ignore the Chromebook market. They're priced low, they're easy to manage."

Microsoft certainly hasn't ignored Chromebooks. They've hit hard at them, notably with an ad featuring the heroes of the reality show Pawn Stars trashing the devices, and saying that a Chromebook is "not a real laptop."

Last month, Microsoft said it was going to make sure that there would be a line of $199 Windows notebooks to compete against Chromebooks. The Verge quoted Microsoft Chief Operations Officer Kevin Turner as saying:

"We are going to participate at the low-end. We've got a great value proposition against Chromebooks, we are not ceding the market to anyone."

So clearly, Microsoft isn't ignoring the Chromebook threat. And it's right not to ignore it. Five percent may sound small, but that's a significant market share, particularly considering that Mac sales eat into Microsoft's PC market as well.

If Microsoft can get a line of $199 notebooks launched, and if Windows 9 proves to be a winner, Microsoft will likely not have a lot to worry about -- that should beat back the Chromebook threat. But if Windows 9 falters, or no $199 line of notebooks appear, Microsoft could see a chunk of its revenue vanish.

Copyright © 2014 IDG Communications, Inc.

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