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Gartner: Chromebooks Rising but Still in a Niche

Chromebooks are mostly being used today in North American educational markets, but sales are set to triple by 2017, according to a new report from Gartner Inc.

Hardware vendors are expected to ship 5.2 million Chromebooks this year, which represents a 79 percent increase over the shipments made in 2013. Chromebook sales are expected to nearly triple to 14.4 million units by 2017, according to Gartner's report, "Competitive Landscape: Chromebooks, Worldwide."

The laptop-like Chromebooks use the Google Chrome OS and depend on cloud-based access to apps and storage, for the most part. The main selling point is simplicity and security, since Google maintains the OS image through an update process. Still, the 5.2 million Chromebooks in use this year constitutes a small fish in a big pond as Gartner expects the 2014 market for all PC shipments to be 308 million units.

Most (85 percent) Chromebooks were sold in the education market in 2013. North America is the main market for Chromebooks, representing 82 percent of sales, according to Gartner's report. The biggest hardware vendor selling Chromebooks was Samsung, with 64.9 percent of the market and 1.7 million units in 2013, according to Gartner's analysis (see chart). Many of the hardware vendors turned to Chromebooks to offset their declining netbook sales.

Chromebook hardware sales 2013
[Click on image for larger view.] Worldwide Chromebook vendor hardware sales in 2013. Source: Gartner announcement.

Business use of Chromebooks hasn't taken off so far across all regions, according to Isabelle Durand, a principal research analyst with Gartner and coauthor of the report.

"We saw some interest from businesses (such as Logitech, City of Orlando, IHG, Dillards retail chain, Mollen Clinics, London Council) even if to date sales are very low," she commented via e-mail.

Enterprise use of Chromebooks also was limited, with some adoption in real estate, hotels, contact centers, stores and libraries.

Google has certainly been pushing Chromebooks for business use. Durand said that Google used the occasion of Windows XP losing its extended support to offer discounts on Chromebooks to organizations in the second quarter of this year. In addition, Google's partnership with VMware has paved the way for businesses and enterprises to access business applications through a desktop-as-a-service approach, as Chromebooks mostly depend on using the Internet cloud to access applications.

"VMware Horizon View 5.3 has been optimized for access from Chromebooks," Durand explained. "This strategy could help Google to expand in the enterprise computing market."

While Google's VMware collaboration builds some trust with the enterprise and business segments, concerns still remain with Chromebooks. Some of those concerns are rooted in requiring Internet access to use applications, but Google is working on that issue, too.

"Google still needs to address enterprise concerns of Chrome devices, such as productivity when you have a poor Internet connection, privacy concerns, lack of customizability, and control over computing experience," Durand said. "But recently Google brings enhancements in terms of offline use of various apps, which is a step in the right direction."

Google touts an average three-year savings per Chromebook of $5,000 vs. a traditional PC, according to a Google Chromebook Web page. This total cost of ownership calculation is based on a few assumptions, such as that the organization replaces its PCs once every three years and that the cost of the warranty is 20 percent of the total cost of a new PC. In addition, Google throws in estimates for maintaining, protecting and patching PCs, as well as help desk costs, in its total cost of ownership estimate.

Durand didn't offer a cost estimate, but she didn't dispute that some of the management costs were reduced when using Chromebooks vs. PCs.

"Some IT organizations could switch to Chromebook to save costs (cheaper than Windows PC)," she said. "Since Chromebooks are cloud-based devices, the security, device management, and even core content creation apps such as Google Docs are run in the cloud which produces cost reductions on both managing and setting up the devices, as well as some software licensing costs."

Still, the report sees Chromebooks as being in "a niche market during the next five years." To expand its markets, Chromebooks will need improvements in connectivity and memory access, as well as larger solid-state drives for local storage, according to Gartner's report.

About the Author

Kurt Mackie is senior news producer for the 1105 Enterprise Computing Group.

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