Microsoft, Intel to limit Windows 7 use on netbooks

Even though netbook manufacturers are pushing the boundaries by continually increasing netbook sizes, it appears Intel and Microsoft will try and stifle that growth by increasing Windows 7 licensing fees for larger netbooks.

A DigiTimes report indicates both U.S.-based companies will max out Windows 7 on netbooks up to 10.1 inches, while some manufacturers, including Acer, Asus and Lenovo, trying to bump up netbook sizes up to 11.6-inch and 12.1-inches.

"The restriction is expected to end PC vendors’ 11.6-inch Atom Zxx-based netbook product lines after the launch of Windows 7, the sources noted," the DigiTimes report says.  Learning from its mistakes with Vista, Microsoft is actively developing a Windows 7 designed specifically for the low-cost, lower-power netbooks. 

The license will be made available for a lower cost, and the Windows 7 Starter will lack obvious features than the PC version of the OS, Microsoft said.  Windows 7 Starter will limit users to only three programs running at one time, and must pay an upgrade fee if they want the full, robust Windows 7 experience.

If true, it’s an interesting move for Microsoft and Intel, with both companies already largely involved in the growing netbook market.  Microsoft’s Vista OS has been shunned for its higher hardware requirements, but Windows XP still remains popular among netbook manufacturers.  Furthermore, Intel CPUs, especially its Atom platform, has been widely used in netbooks that are increasing in hardware power.

Since manufacturers currently make less on individual unit sales of netbooks when compared to traditional notebooks, I don’t think I can blame either company for doing what they have to do to try and get better control of the netbook market.  For example Microsoft obviously would rather have its Windows OS used on netbooks instead of Linux, but hasn’t seen big revenue numbers with the sale of XP-powered netbooks.