"The cheap path
As Caitlyn Martin pointed out recently, the price of entry level Linux netbooks is dropping to incredible lows! You can now get a basic Linux netbook for less than $200. The original Sylvania GNET is now selling for around $179 on Amazon. Last week I pointed you to other excellent deals on Linux netbooks. As these little machines become more and more commoditized the prices will have to drop, and the price of the Windows license will be harder and harder to justify. This will be especially true for subsidized netbooks, as the network operators will want the cheapest option possible and may not see much added value in Windows.
"Microsoft has no intention of lowering it's prices, in fact most rumors suggest that Windows 7 starter will cost twice as much as Windows XP to OEMs. This means that the netbook manufacturers will be forcer to increase the price of their Windows based products. This will widen the price gap between Linux and Windows based netbooks even more. If you add the fact that Linux netbooks require less resources than their Windows counterparts to deliver a smooth user experience you have a situation were Linux based netbooks will be ideally placed to sell as cheap companion machines. Windows netbooks on the other hand will look more and more like expensive and underpowered mini laptops. Cheap subsidized netbooks have another advantage: since the 3G network operators have their own "Brick and Mortar" shops this will create an extra outlet for Linux netbooks on which Microsoft has little control."
