Will Nokia Upgrade a Smartphone to a Netbook?

How popular have netbooks become? Nokia, a company that makes plenty of money with smartphones is looking into making a netbook (GigaOm, Reuters). Of course, many have noted that Nokia's market share dwindles against smartphones from people like Blackberry and Apple, so they may be looking for a new product line. But does this make sense?

On the “Yes” side, Nokia has long demonstrated high levels of engineering expertise by cramming so much technology into such a small case. While a traditional laptop engineer may think a netbook way too small, a Nokia engineer may hyperventilate at the thought of so much room to work with. And since one popular netbook distribution channel runs through wireless companies, Nokia already has those connections.

On the “No” side, dealing with Microsoft XP will be new territory for Nokia, as will supporting a computer, not telephone, operating system for customers. Nokia's sales channels tend to be through phone outlets, an odd place to go computer shopping.

Will Nokia bite the netbook bullet? I hope so for two reasons. First, more engineers looking at the netbook form and price limitations increase the chances of innovations that will help you and me both. Many advances appear when experts from one area bring their bag of tricks and problem solving expertise to a new area. Second, more competition means more options for consumers and businesses. Netbook prices are climbing above the $500 mark from many vendors, and more competition may reduce that price inflation.

If Nokia succeeds beyond their wildest dreams, they'll make some money but won't overwhelm their phone business revenue. If they fail miserably, the money spent won't drastically impact their bottom line. I say go for it, Nokia.

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