Does Samsung’s New Chromebook Pose a Threat?

Does Samsung's new, expensive, and flashy Chromebook pose a threat to the traditional PC vendors' Chromebook efforts?

Mar 5, 2014 at 9:00PM

Samsung's (NASDAQOTH:SSNLF) very first Chromebook was an interesting beast. Unlike the power-guzzling, under-performing Atom based initial Google Chromebook, the Exynos Dual powered beauty offered solid performance and battery life in a power envelope that enabled a slim, fan-less design. The success of this particular Chromebook actually sent Intel (NASDAQ:INTC), and the rest of the PC industry, into somewhat of a panic, leading them to flood the market with fast and cheap – although not quite fanless – "Haswell" powered Chromebooks.

This new Chromebook is attractive...
Samsung's pair of new Chromebooks are actually quite attractive. The 13" model, which will retail for $399, comes packed with a 1920x1080 display, a Samsung-designed Exynos 5 Octa processor, 4GB of DDR3, and 16GB of onboard storage. It should be quite zippy, have solid battery life, and in general be a nice machine for users that don't need the full power and flexibility of a more expensive Windows device.

It's actually an interesting exercise to compare this device with a comparably priced Windows 8.1 notebook. In this case, a scan of Newegg.com reveals that a close competitor is this $366 notebook from Acer:

Acer

(Source: Newegg.com)

For roughly the same price, the user gets a Pentium M3520, a quad core Atom-class CPU with integrated Intel HD graphics (it should be a fair bit faster than the Exynos Octa), and a larger – but lower resolution (1366x768 against 1920x1080) – display. In place of the 16GB of integrated flash memory, Acer offers a 5400 RPM 500GB hard disk drive (more space, but much slower storage). Of course, the Acer runs Windows 8.1 while the Chromebook is limited to Chrome. A final thing to point out is that the Chromebook is fanless while the Acer apparently needs a fan.

...but the traditional PC vendors are pushing hard, too
While Samsung's new Chromebook has a more premium feel to it (the whole faux leather thing gives that impression) and while Samsung probably has a pretty nice cost structure, it's important to note that the traditional PC vendors appear to be willing to fight tooth-and-nail to try to claw share away from Samsung by aggressively pursuing Chromebooks. Indeed, Acer put out a new Chromebook, packing an Intel Haswell processor that offered greater performance than the Samsung Chromebook but retails for only $199. Unsurprisingly, this device rose to the top of Amazon's best-sellers list in seemingly no time flat:

Best

(Source: Amazon.com)

Does the new Chromebook change things?
The interesting thing here is the pricing of the new Chromebook. The best-selling notebooks seem to be, unsurprisingly, the cheapest ones (sans the MacBook Air). While the new Chromebook is obviously better/faster, there is probably some very real price elasticity in the low end notebook/Chromebook market. At $399+, many will probably go with a full Windows 8.1 device. The value in these Chromebooks seem to be as secondary/tertiary devices, which would explain the high sensitivity to price. Note that the Acer laptop, even with a fan, seems to sell better than the first-gen Samsung simply because it's a mere $44 cheaper.

Foolish bottom line
It looks as though Samsung has seriously de-focused on traditional notebooks and is trying to instead "build up" its Chromebook line (presumably because Samsung can keep more of the bill-of-materials to itself with a non-Wintel device). Whether this succeeds or not, time will only tell, but one thing is clear: The traditional PC ecosystem better put out a fanless, Intel-based Chromebook sooner rather than later. Say, when's Intel's Bay Trail going to find its way onto a Chrome device, anyway? 

All tech investors should know this opportunity
Opportunities to get wealthy from a single investment don't come around often, but they do exist, and our chief technology officer believes he's found one. In this free report, Jeremy Phillips shares the single company that he believes could transform not only your portfolio, but your entire life. To learn the identity of this stock for free and see why Jeremy is putting more than $100,000 of his own money into it, all you have to do is click here now.

Ashraf Eassa owns shares of Intel. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers