The VAR Guy was guilty of hyping Windows-based Ultra-Portables from startups like OQO a year ago, but he has drastically changed his thinking about the Ultra-Portable computer market. He thinks current market dynamics greatly favor Linux over Windows in the Ultra-Portable industry. Here's why.

First, some thoughts about product positioning. The OQO pitches itself as "a full PC that fits in your pocket." Some executives and power users certainly want a small, full-functioned Windows device. But packing a lot of power into a small design requires a price premium. The OQO starts at about $1,300.

Meanwhile, The VAR Guy thinks most Ultra Portable customers want a simple, low-cost device that handles 80 percent of traditional computing tasks. Give 'em email, Web video, a complete keyboard, presentation capabilities, a seven-inch screen, etc., and most buyers are all set.

Yes, both Windows and Linux can work on these l0w-cost Ultra Portables. But here's the catch: In the Windows world, hardware makers typically have a lot of back-and-forth with Microsoft on design specs. And then they have to negotiate hard with Microsoft on Windows licensing terms.

The challenges don't stop there for the Windows camp. Generally speaking, it's sometimes difficult for hardware makers to differentiate their Windows devices from one another because they spend too much time talking about Microsoft compatibility and too little time describing unique applications.

The situation is quite different in the world of Linux. There, device makers can focus first and foremost on the key applications they want to promote to customers. Plus, they can move fast -- really fast -- by adapting Linux to fit their needs, or by playing multiple Linux distributions against one another to find a software partner that's best suited to assist their efforts.

Some companies like ASUS are hedging their bets and designing Linux and Windows devices (let the customer choose). But ultimately, The VAR Guy suspects more and more hardware providers will quietly choose Linux for Ultra Portables that cost $500 or less.

Here's the bottom line: At a time when more and more businesses are paying $1,000 or less for their laptops, it's hard to justify Ultra Portables with price tags starting at $1,300. In stark contrast, Linux seems to be perfectly suited for truly low-cost Ultra Portables.

Is The VAR Guy mistaken? Will Windows somehow dominate the low-end Ultra Portable market? The VAR Guy is open to other opinions... and debate.

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