Google Chromebook Economics and Market

The Worldwide professional PC market is about $160 billion per year (about 125 million professional desktop PCs).

Google’s Chromebook is trying to capture a large piece of that market. Google unveiled a subscription program for businesses and schools to get Chromebooks. For businesses the cost is $28 per machine per month. And for schools, the cost is $20 per machine per month. The subscription fee includes the hardware, administrative support, hardware upgrades, and warranty.

People pay a monthly fee and get software, hardware and support for the Chromebook. Small and large users can drastically reduce the need for IT support staff by switching to Chromebook.

A business can weigh whether hiring more $60,000-100,000/year IT staff and costs and issues and limitations of their current IT desktop support model is more costly versus the Google Chromebook model.

The Chromebook program ensures that administrators have complete control over every computer within their network — with no exceptions. There isn’t a way that a user can accidentally download any files that might compromise the network because the whole system is based on a web interface. There’s also a smaller chance that they will accidentally leak sensitive information because it will all have to go through a centralized administrator.

Currently many company that use Windows remove administrator privileges from users but still have to deal with viruses and user problems which create support work. Business users without control of their desktop PC are dependent for basic functions even if they have the technical knowledge. IT desktop support also tends to lock users into older versions of software to control support issues. Many businesses have desktops that are still Windows XP and IE6. Windows XP still has 45% market share, Windows 7 at 33% and Windows Vista at 12%. Google Chromebook allows for a safe path to a constantly upgraded browser but which is still easy for app developers to target and test development. App developers just need to develop for the one up to date version of Chromebook. Currently application development for businesses has the headache of trying to ensure and test that new applications do not conflict with other applications to break parts of the desktop environment.

Computereconomics – as an average percentage of total IT staff, server support personnel rose slightly over the past four years, from 12.2% of the typical IT staff in 2007 to 13.2% in 2010.

About 20-25% of companies outsource some portion of desktop support.

6.3% of IT staff are desktop support staff.

Network support staffing are about 7-8% of overall IT staff.

A company that can avoid one $80,000/year desktop or server support person (including benefits that would likely be higher) could have 245 free Chromebooks. This is putting no value on the hardware or software.

Definitely companies that are already outsourcing to India to reduce IT support costs would look at using Google Chromebooks as an option.

The other competing solution is the hosted virtual desktop market.

Desktop virtualization separates a personal computer desktop environment from a physical machine using the client–server model of computing. Many Enterprise-level implementations of this technology store the resulting “virtualized” desktop on a remote central server, instead of on the local storage of a remote client; thus, when users work from their local machine, all of the programs, applications, processes, and data used are kept and run centrally. This allows users to run operating system and execute applications from a smartphone or thin client which exceed the user hardware’s ability to run. Some virtualization platforms allow the user to simultaneously run multiple virtual machines on local hardware, such as a laptop, using hypervisor technology. VMWare is a major player in this area.

There is a short linkedin discussion about whether Chromebook is the ultimate virtual desktop and/or a viable consumer thin client.

One of the solutions for accessing windows application and virtual desktops from your Chromebook – Ericom AccessNow

Ericom Software has released a beta version of Ericom AccessNow, the market’s first pure HTML client providing access to applications and desktops running on Windows Terminal Services (RDS) and VDI platforms, including session-based applications, remote desktops, and virtual desktops running on Microsoft Hyper-V and other hypervisors. Running entirely within a browser, AccessNow works natively with Chrome, Safari, Internet Explorer (with Chrome Frame plug-in), Firefox and any other browser with HTML5 and WebSockets support.

The Worldwide music industry is about $67 billion.

Apple iTunes sales in the second fiscal quarter of 2011 were $1.4 billion (up from $1.1 billion in the first quarter). iTunes is selling video, music and apps.

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