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Commentary: Gateway, AOL deal doesn't mean the end of Wintel

Gateway's and AOL's Transmeta/Linux approach does not mean the end of the Microsoft Windows-Intel duopoly, but it signifies a growing market with more types of customers.

    See news story: Gateway, AOL favor upstart chipmaker over big names

    By Mark Margevicius, Gartner Analyst

    Net appliance offerings from Gateway and America Online represent another step in the evolution of technology options for consumers.

    Three factors drive this phenomenon: complexity, usage and cost. PCs in their current configurations are still too complex and costly for many consumers, so adoption rates within homes are not nearly as high as they are with other consumer electronic appliances, such as televisions and stereos.

    For many potential PC customers, the Internet is the only application they want to use. These customers feel that a full-blown PC comes with too much technology, and they would prefer a simpler approach to getting on the Internet. The planned appliances from Gateway and AOL solve the issues of complexity and usage--all at anticipated lower costs.

    Opting for a Transmeta/Linux approach does not mean the end of Wintel, the Microsoft Windows-Intel duopoly, but it signifies a growing market with more types of customers.

    Internet appliances are not traditional, fully functional PCs, and they are not intended to be so. A PC offers superior flexibility and can be used in a myriad of ways, including acting as a quick connection to the Internet. A Net appliance has one purpose--and for many consumers, that's enough. While an Internet appliance may offer some PC functionality, it is not designed to be a complete replacement.

    Gateway's and AOL's choice of Linux as the operating system does not imply that it is appropriate for today's PC platform across the board. It also does not signal the demise of Windows as the dominant PC platform.

    Linux as an Internet appliance's operating system will be effective for browsing, with much of the complexity completely hidden from the consumer. As new devices supplement the desktop, such as Webtops, Webpads, cell phones and personal digital assistants such as the PalmPilot, Windows-alternative operating systems will be evaluated and used.

    However, Linux--or any operating system--will not diminish the strength of Windows in desktop PCs or notebooks. By using Transmeta's Crusoe chip and a Linux operating system, Gateway and AOL will benefit from lower component and licensing costs, which will lead to lower consumer costs.

    In addition, Transmeta microprocessors dissipate less heat because of their lower power requirements. This feature will be used by original equipment manufacturers such as Gateway to design and build devices that are smaller and thinner--a characteristic that will make the devices more appealing to many consumers.

    Entire contents, Copyright © 2000 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.