Apple's U.S. smartphone installed base has surpassed Microsoft's for the first time

Click to enlarge. Source: comScore

Given that the iPhone has been outselling Windows Mobile devices in the U.S. for nearly two years, it comes as something of a surprise that Apple (AAPL) has only now caught up to Microsoft (MSFT) in terms of active smartphone users.

But that's what the latest data from comScore show. The bar graph at right, drawn from numbers obtained by FierceDeveloper, shows that the installed base of iPhone users in the U.S. overtook Windows Mobile's sometime between July and October 2009.

Microsoft had a big head start, of course, but its market share has been stagnating lately. Research in Motion (RIMM), by contrast, enjoys both a head start and a growing market share. According to comScore, about 40% of the smartphones still in use in America are BlackBerries, while less than 25% are iPhones.

A copy of comScore's report can be purchased at the compay's site for $4,995.

Below the fold: A full-size version of the chart.

[Follow Philip Elmer-DeWitt on Twitter @philiped]

Source: comScore

With ownership of the SMB market, is Citrix Online a threat to Cisco?

Caine's Citrix owns unified communications - for now. Photo: Citrix.

Hoopla around Google Wave service, launched publicly in September, has brought resurgence to the idea of unified communications — a single platform that integrates voice, email, fax (really!), chat, and web conferencing. Long a dream of the telecommunications industry, unified communications is gaining some buzz among corporate tech teams as a possible tool for enhancing employee productivity.

As tech executives ponder their options, vendors of communications services are racing to grab share in the nascent market. But so far, it's not online voice purveyor Skype or event Google (GOOG) that is making real waves in unified services — so far. Instead, the leader is a relatively unknown company: Citrix.

Citrix Online is the dark horse — some would say underdog — of the web conferencing space. (Citrix Systems was founded in 1989, acquired Expertcity in ’03 and renamed it Citrix Online, which oversees the company’s remote collaboration tools.) As Cisco (CSCO), Microsoft (MSFT), and IBM (IBM) fought for big Fortune 500 enterprise clients during the 2000s, Citrix focused on small to medium-sized businesses. From 2006 to 2007, Citrix’s revenue increased 50% and jumped more than 100% the following year to 101.4 million, according to Gartner data. And analysts expect the same growth this year.

The company delivered a product that had the right amount of features at the right price, says Roopam Jain, Frost and Sullivan’s principal analyst for collaboration.

“Citrix has been very aggressive around the SMB market,” Jain says. “Citrix has seen the fastest growth in this space; it’s brought meaningful market prices and hit what everyone wants — the sweet spot.”

Serving the small business sweet spot

Citrix is now hot on the heels of IBM and Microsoft — and if it continues to grow at the same rapid speed, it would be a surprise to no one if Citrix surpassed both these tech giants in market share. But compare Citrix's 2008 101.4 million revenue to Cisco’s $551 million revenue figure, and Citrix still has a long way to go.

Timing is everything. For years, small-to-medium businesses were notorious for their reluctance to invest in new technology. But as the recession kicked in, so did Citrix’s business. As enterprise clients decided to wait on investing in more technology, small-to-medium businesses were pressured to cut back, says David Smith, Gartner’s collaboration analyst.

And so small-to-medium businesses looked toward the best technology solution to replace travel expenses and unnecessary overhead — at an affordable price.

“The SMB market was very much underserved in 2004 and 2005,” says Brett Caine, president of Citrix Online. “At the time, the existing options required a lot of training and the prices were unpredictable. That’s when we stepped in and saw our opportunity.”

Citrix’s lucrative success in the SMB market has garnered the attention of many of its competitors, which has also expanded its reach and focused on this segment. Specifically, IBM and Microsoft have made big pushes for SMB in the past few years, Gartner analyst Smith says.

For Cisco, more competition has driven the company to work harder than ever to maintain its market share dominance, says June Bower, vice president of Cisco Collaboration Software Group. After acquiring WebEx in 2007 for $3.2 billion, Cisco recognized the need to expand its client base in the market and is now fully armed to not only serve its existing enterprise clients but all the small-to-medium business clients as well.

As the tech giants look to expand their reach and try to appeal to both enterprise and SMB clients, Citrix will continue to focus on small-to-medium businesses, with the hopes of gaining more and more customers (this year the focus is abroad), and effectively, more and more market share. Ironically, despite not targeting enterprise clients, those companies are actually approaching Citrix, Caine says.

But will Citrix be a lasting success? Caine says that Citrix Online has no intent on moving toward a unified communications platform, unlike the rest of the industry. His argument is that his clients don’t want that.

Web conferencing is the leading web collaboration tool that both enterprise and SMB clients want after email, but actual implementation is slow, according to Forrester research. But right after web collaboration, companies also want video conferencing. So would it not make more sense to invest in a service that could provide a unified communications solution?

We’ll see. The market is still too young to tell. But Caine says Citrix is ready to adapt to whatever changes or demands his clients want. And if the company adapts its tools as quickly as it has grown, well, then this dark horse could win the race.

High profile private equity shop appears to be chatting up a new fund despite string of struggling investments.

Word is that Elevation Partners, the high-profile if poorly timed private-equity firm headlined by rock star Bono and star investor Roger McNamee, is considering raising a new fund.

Elevation's investment partners (from left): Bret Pearlman, Fred Anderson, Bono, Marc Bodnick and Roger McNamee. Photo: Elevation Partners.

As surely as dogs chase rabbits or night follows day, PE shops raise more money when the existing fund is mostly used up. (Elevation's is about 70% invested.) Yet when all you have to show for your first effort are embarrassing misses — no rabbits caught, mostly grim darkness, metaphorically speaking — it's got to be tough to collect fresh cash.

This is the tough position in which Elevation finds itself. Despite having raised $1.9 billion in 2004, the ballyhooed firm is far from a successful experiment. It's got all of one exit, a gaming-company sale to Electronic Arts (ERTS), headed by an Elevation co-founder.

Two of its investments are seriously sick. One is the online real estate dog Move.com (MOVE), better known by its scandal-ridden former name, Homestore.com. The other is Forbes Media, the parent for FORTUNE competitor Forbes Magazine, in which Elevation invested at perhaps the worst time in decades for media enterprises.

The snafus sting, of course. But the fate of Elevation's first fund rests almost solely on one investment, its $460-million stake in beleaguered smartphone maker Palm (PALM). That investment is barely in the money for Elevation. It's worth about $500 million currently.

Elevation is demonstrably in for the long term: It chose not to sell late last year when the stock peaked around $18, compared to Tuesday's close of $11.65. Palm recently raised $500 million in a stock offering, so its near term is secure.

Still haven't found what they're looking for?

But the company is a long way from a home run, unless Elevation forces a sale to a bigger player like Dell (DELL) or Microsoft (MSFT). Remaining independent is an expensive proposition, however, as Barclays analyst Amir Rozwadowski notes to clients.

"We believe that its improved cash position should enable the company to be very aggressive in its marketing efforts over the next few quarters, particularly as the company looks to improve brand recognition, carrier distribution, and overall awareness of its products," he writes. "We do however expect the company to continue to burn cash at a healthy clip in the near term, as expanding scale is at the top of management’s agenda."

Elevation declined to comment on its fundraising agenda. It needs to raise a new fund, though, in part because it recently added longtime eBay CFO Rajiv Dutta to its ranks as managing director. New bigshots typically don't get to participate in the "economics" of five-year-old funds, so if Dutta, a skilled operations and financial executive, is to make some serious money at Elevation, he'll need a fund from which to invest.

Elevation doesn't have trouble getting meetings. Endowment heads are likely to agree to a sit down if Bono shows up. Once in the room, there are few better talkers in Silicon Valley than McNamee. (A wonkish fantasy: a "talk-off" featuring McNamee, venture capitalist John Doerr and Apple's Steve Jobs. Imagine the possibilities.) McNamee and his partners will have their work cut out for them, though. One win, two disasters, a couple fresh investments and one still risky possibility. Not the strongest lineup to bring into a pitch meeting.

The long-rumored gPhone has surfaced, but no one can agree on what it means

The purported Google phone. Photo: Cory O'Brien

Google (GOOG) announced on its mobile blog Saturday what dozens of staffers had already leaked: the company has given employees around the world free handsets running its Android mobile operating system. The idea, according to the official report, is to have Google's own people test various advanced features and offer feedback to the company's designers — a process known in the business as "dogfooding" (as in "eating your own dogfood").

Not surprisingly, given Google's financial clout and the power it wields over the Internet, the experiment has launched a storm of speculation about what it means. As we sort through the theories, we count at least nine ways of looking at the Google phone:

1. Google is in the process of designing an unlocked cellphone that it plans to sell directly to the public online — bypassing the mobile carriers and brick-and-mortar retailers — sometime next year. This is the line TechCrunch took first and the Wall Street Journal has picked up, citing unnamed sources "familiar with the matter."  This theory underlies much of the theorizing that follows.
2. Google has watched with dismay as smartphone makers tweak the Android OS to suit their needs, fragmenting the software ecosystem and scaring off developers. "By putting its stake in the ground," writes GigaOm's Om Malik, "the company is hoping that it doesn’t make the mistake that Microsoft made by dragging its feet in releasing Zune and ceding the market to Apple’s iPod."
3. Apple (AAPL) has finally met its match in a competitor that has the resources, the partners and the staying power to challenge the iPhone. This, finally, is the real iPhone killer.
4. The iPhone, despite the failure of AT&T's (T) network to keep up with bandwidth demands in high-profile urban markets, continues to sell like crazy. Google realizes it has to move fast or the game will be lost.
5. A Google phone sold without a subsidy from the mobile carriers would be prohibitively expensive — at least $400, and probably more like $500 or $600, according to Ian Betteridge's back of the envelope calculations. (See his comments here.) A carrier like T-Mobile (DT) could sell the same phone for a fraction of the price.
6. Google could subsidize the phone out of its own pocket, perhaps giving it away for free to drive more traffic to its revenue-producing ads — a strategy that's worked for nearly every other project in Google Labs.
7. If Google were to try to sell a smartphone below cost, the company would be facing a 21st century version of the Microsoft (MSFT) antitrust trials, and the start of a long, slow decline.
8. Google is about to alienate the very hardware manufacturers it's counting on to carry the Android flag. Why would customers buy a Motorola (MOT) Droid, for example, when they could get the official Android smartphone from Google?
9. Google has no intention of making its own hardware. The so-called Google phone is actually  the HTC Passion (AKA Bravo), an Android 2.1 smartphone set for U.S. release by T-Mobile in January. The "dogfooding" exercise is exactly what Google said it was — a way to test a bunch of advanced Android features on a friendly user base before they go public.

[Follow Philip Elmer-DeWitt on Twitter @philiped]

Cisco CEO John Chambers and strategy chief Ned Hooper address analysts. Photo: Jon Fortt.

Cisco has its swagger back.

When the networking provider hosted Wall Street analysts at its San Jose headquarters Tuesday for its annual update on the state of the business, the most striking thing was the full-scale return of confidence. After a year in which most of tech has struggled to regain its footing in a global financial crisis, CEO John Chambers and his lieutenants told the financial community that they’re poised to grow sales faster than big companies typically can.

To be specific, Chambers says that in normal economic times Cisco (CSCO) can deliver annual sales growth of 12-17%. Off of his current revenue base of $36 billion, that translates into a promise to find more than $4.3 billion in new revenue this year alone.

Chambers believes he can do it because a fresh set of Internet technologies is changing the way we communicate – and giving Cisco a chance to grab a greater share of the spoils. Chambers has outlined three opportunities he believes will reap big rewards: video, collaboration and virtualization.

In the simplest terms, Cisco is betting that video will continue to grow its share of overall Internet traffic as carriers use the Internet video to deliver movies and TV, businesses use it to help employees share ideas and close sales more quickly, and consumers use it to express themselves on the go.

All of that new video traffic should create demand for Cisco’s highly profitable networking gear. It should also create new openings for someone to sell communication systems, back-end servers and management software to run it – and Chambers is positioning Cisco to make that sale.

Skeptics point out that Cisco has stronger competition than ever. Hewlett-Packard (HPQ) and IBM (IBM) sell their own packages of virtualization technology. Microsoft (MSFT) and IBM have their own collaboration suites. Each has resources to rival Cisco’s – and it would be foolish to count any of them out.

So can Chambers deliver? More than a few analysts think he can. They point to Cisco’s cash hoard that’s approaching $40 billion, its track record for successful acquisitions, and its knack for spotting trends early enough to get a jump on rivals. He’ll probably need to use all those tools – and some new ones – to meet his own lofty growth targets.

Tech's top vendors see small companies as a big opportunity.

Software giant Microsoft (MSFT) tops a new ranking of technology companies effectively serving small businesses online by providing a rich, educational web experience for small companies.

Compass Intelligence, a Scottsdale, Ariz.-based consulting firm, analyzes the websites of dozens of tech companies – and interviews small business owners and executives – to come up with its rankings, which it publishes twice each year.

Microsoft leaped to the No. 1 ranking from No. 6 in the first quarter of 2009, essentially switching places with computer maker Dell (DELL) which slipped to No. 6 from the top spot in the first quarter. (Remember, the Compass rankings look at just one part of the tech company's small-business strategy: online reach. All these companies also work through resellers, local affiliates and even have direct sales folks marketing to and servicing small entities.)

That said, the top ten, in order, are:

1. Microsoft
2. AT&T
3. Cisco
4. HP
5. IBM
6. Dell
7. Verizon
8. Sprint Nextel
9. Nortel
10. Symantec

"All these companies are commited and focused on the [small-to-medium sized business market](in different ways)," Kneko Burney, chief strategist for Compass, writes in an e-mail. " They all 'get' small business."

And that may prove to be smart business. Compass estimates that U.S. small businesses – companies with 20 to 100 employees – will spend more than $230 billion on technology in 2009. And a separate new report suggests smaller companies are loosening their purse strings on tech spending even as large enterprises remain cautious.

The Global Technology Distribution Council, a consortium of technology distributors such as Arrow Electronics (ARW) and Avnet (AVT), last week said its members' U.S. sales in the third quarter rose 10.7% over the second quarter.

Large companies "have cut back tech spending, and they're still hunkered down," observes consortium CEO Tim Curran. "SMB (small to medium business) in this instance seems to be a leading indicator of companies starting to invest."

Curran said his members, which serve value-added resellers and other "channels" that, in turn, directly sell to smaller firms, have been seeing particular interest in investing in security solutions and cloud computing services that deliver business software and other applications over the Internet.

Even tech executives who deal primarily with the very largest global companies are talking about their companies' ability to serve small-business clients.

"We have a porfolio that fully meets what small businesses need," says Ann Livermore, executive vice president of HP (HP) Enterprise, a $54 billion-a-year unit that includes consulting, hardware and software sales to businewsses of all sizes. Adds Livermore: "You'll see us being very focused" on the segment.

Entrepreneurs also rely heavily on mobile technology to run their companies. Today there are hundreds of mobile applications that enabling small biz executives to operate while on the go (everything from an application for sending and tracking FedEx (FDX) packages to an app that turns an Apple (AAPL)  iPhone into a voice recorder).

No wonder a Yankee Group study released in September found 28% of small businesses said "smartphone implementation" — the deployment and upgrade of Internet-enabled mobile devices – was their top tech priority in the next 12 months.

Small businesses reliance on mobile means wireless operators have an opportunity to expand their relationship with small businesses, perhaps acting as a distributor for other tech companies' hardware and software or even offering integration and other services in competition with companies such as HP and Dell.

In many ways, the telcos are already seizing the small-business opportunity. AT&T (T) is the No. 2 company on the Compass Intelligence report. "What I love about AT&T is that they are very aggressive in rolling out new "cloud" services tailored just for this market," Burney writes.  "They are focused on providing a suite of services to enable these customers using the power of the network. That's definitely the future."

Seagate's Pulsar drive uses single-level cell NAND flash, and is the first of what analysts expect will be many solid-state products from the storage giant. Image: Seagate.

Flash memory – the stuff that stores data in consumer gadgets like phones and digital cameras – is also finding its way into more corporate data centers. It turns out that while flash is still far more expensive than trusty old hard drives, it uses less power and serves up information quickly. That makes it well suited for tasks like data mining, business information and any other situation where time is money.

That’s why Seagate (STX), the world’s largest manufacturer of hard drives, is getting into the flash game. Seagate today is expected to unveil Pulsar, a new flash-based storage product that looks like a hard drive and holds up to 200 gigabytes of data. The drive is designed for a mainstream server – the kind that handles e-mail and basic databases – and is the first of many flash-based products Seagate hopes to release soon.

Seagate has one big advantage as it breaks into the enterprise flash market: it’s already the big dog in data center hard drives, selling to the likes of Google (GOOG), Microsoft (MSFT) and EMC (EMC). Because Seagate’s sales folks know how businesses buy storage, they’ll be able to quickly muscle their way to the front of the flash supplier line.

But there are also challenges. For one, smaller companies like Fusion-io have been selling enterprise flash drives for quite a while – and from what I’ve heard, some of them arguably have edgier technology based on the SAS and PCI interfaces. After my chat with Seagate sales exec Dave Mosely, I asked Gartner storage analyst Joe Unsworth for his take on Pulsar.

“The Seagate drive is a decent start considering that they are indeed late to the game,” Unsworth wrote in an email. “However, the product itself does not differentiate itself compared to what is out there – after all, it is really only targeted at the server market and is based on the SATA interface.”

There’s also the question of where Seagate’s going to get the flash for its drives, and for how much. In its hard drive business, Seagate rules the supply chain. In flash, not so much. Top flash manufacturers Samsung and Toshiba sell most of their stash to companies like Apple (AAPL), which gobble it up for gadgets like iPods and iPhones.

Seagate at least won’t be buying the same kind of multi-level cell flash that’s in most consumer devices; instead it will use the lower capacity but higher-endurance single-level cell variety. Still, though, flash prices can swing wildly, and by getting into this market Seagate will be increasing its exposure to that volatility. That’s not much of a concern for now, but over time the company will have to ink deals that guarantee its flash supply at manageable prices.

So bottom line: It’s good to see Seagate out there with its own enterprise flash storage, and it’s sure to do fine out of the gate. But to have the kind of success here that it’s had with hard drives, Seagate will have to get busy innovating – and maybe also acquiring smaller outfits that specialize in flash.

(MSFT) (AAPL) (GOOG)

What critics were saying about Steve Jobs' smartphone in the months before it launched

Microsoft's Steve Ballmer. Click to play.

Three years ago, when it became clear that Apple (AAPL) was about to unveil some kind of mobile phone, critics began to weigh in on its chances of success. AAPLinvestors' Terry Gregory, building on a list of skeptical quotes begun by MacDailyNews, has put together what may be the definitive collection.

A sample:

“We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in.”
Palm CEO Ed Colligan, commenting on then-rumored Apple iPhone, 16 Nov 2006

“Apple is slated to come out with a new phone… And it will largely fail."
Michael Kanellos, CNET, 7 December 2006

"The only question remaining is if, when the iPod phone fails, it will take the iPod with it.”
Bill Ray, The Register, 26 December 2006

"Apple will likely have a tough time convincing application vendors to build specialized clients for the iPhone until the volumes are there, and the volumes could be limited by the lack of third-party applications – a Catch 22.”
Jack Gold, J. Gold Associates, 10 January 2007

“The iPhone is nothing more than a luxury bauble that will appeal to a few gadget freaks."
Matthew Lynn, Bloomberg, 15 January 2007

"Five hundred dollars? Fully subsidized, with a plan? It is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard which makes it not a very good email machine… So, I, I kinda look at that and I say, well, I like our strategy. I like it a lot.”
Steve Ballmer, Microsoft CEO, 17 January 2007

I am not sure how it will stand against Sprint’s Wimax (when it successfully launches) and its phones, which I am looking forward much more than over-hyped Apple iPhone.”
Bhaskar Chitraju, Indews Broadcast, 18 January 2007

"iPhone may well become Apple’s next Newton.”
David Haskin, Computerworld, 26 February 2007

“Apple should pull the plug on the iPhone… What Apple risks here is its reputation as a hot company that can do no wrong. If it’s smart it will call the iPhone a ‘reference design’ and pass it to some suckers to build with someone else’s marketing budget. Then it can wash its hands of any marketplace failures… Otherwise I’d advise people to cover their eyes. You are not going to like what you’ll see.”
John C. Dvorak, 28 March 2007

“There’s no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I’d prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get.”
Steve Ballmer, Microsoft CEO, 30 April 2007

“How do they deal with us?”
Ed Zander, Motorola CEO/Chairman 10 May 2007

“Apple begins selling its revolutionary iPhone this summer and it will mark the end of the string of hits for the company.”
Todd Sullivan, Seeking Alpha, 15 May 2007

"What does the iPhone offer that other cell phones do not already offer, or will offer soon? The answer is not very much… Apple’s stated goal of selling 10 million iPhones by the end of 2008 seems ambitious.”
Laura Goldman, LSG Capital, 21 May 2007

“We Predict the iPhone will bomb. Which means that when the iPhone comes, Digg will likely be full of horror stories from the poor saps who camped out at their local AT&T store, only to find their purchase was buggier than a camp cabin.”
Seth Porges, The Futurist, 7 June 2007

“The forthcoming (June 29) release of the Apple iPhone is going to be a bigger marketing flop than Ishtar and Waterworld combined. Because its designers forgot Platt’s First, Last, and Only Law of User Experience Design (“Know Thy User, for He Is Not Thee”), that product is going to crash in flames. Sell your Apple stock now, while the hype’s still hot. You heard it here first.”
David S. Platt, Suckbusters!, 21 June 2007

“God himself could not design a device that could live up to all the hype that the iPhone has gotten.”
Harvard computer science professor David Platt, 25 June 2007

More than 33 million iPhones, 100,000 apps and 2 billion downloads later, the death watch continues. To see AAPLinvestors' full collection — including comparisons to such "iPhone killers" as the Palm (PALM) Pre, Research in Motion's (RIMM) BlackBerry Storm and Motorola's (MOT) Droid — click here.

[Follow Philip Elmer-DeWitt on Twitter @philiped]

Will tomorrow’s PC be a nimble netbook or a high-def laptop? Google and AMD recently offered opposing views.

If Google has its way, the mainstream PC of the future will be a lot simpler than the one you’re using right now.

Like a TV, it will turn on almost instantly instead of taking nearly a minute to boot up. It will do everything through a web browser, pulling down most programs and data from the Internet. It’ll make do with a low-cost processor and will carry a cheap price tag – kind of like today’s stripped down netbooks, only with even fewer frills.

That’s just Google’s (GOOG) vision. A few miles down the road from the search giant’s Silicon Valley headquarters, the folks at chipmaker Advanced Micro Devices have a very different idea.

AMD is wagering that the majority of tomorrow’s shoppers will want more performance from their PCs. It is putting the finishing touches on a new chip that combines a microprocessor and a graphics core in one – a trick it hopes will attract consumers who want smooth high-def video and rich 3D gaming in a slim, low-cost package.

Who’s closer to the mark?

Of course, it’s too soon to tell. But before long shoppers will get to vote with their wallets.

Last week Google engineers showed off an early version of their browser-based Chrome operating system, what they call “a better model for personal computing.” (When it’s broadly available, Chrome will come pre-installed on netbooks that are specifically designed to run it.) A few days earlier, AMD announced that its Fusion processors would arrive in 2011. If all goes as planned, the two technologies will be duking it out on retail shelves in a little more than a year.

The contrasting ideas from Google and AMD come at a turbulent time for the computer industry.

Sales have slowed in the global recession, pressuring the PC revenues of stalwarts like Hewlett-Packard (HPQ) and Dell (DELL). Hardware profit margins have also suffered as bargain shoppers shun higher-priced machines in favor of netbooks with small screens, modest horsepower and low price tags. (The exception is Apple, which has somehow managed to keep selling premium PCs in a historic recession. Go figure.)

The big question is where the industry’s next stage of growth will come from. Will consumers shift their dollars toward wireless computing devices that resemble Amazon (AMZN) Kindles, Apple (AAPL) iPhones and Google Chrome-powered netbooks? Or will they find reasons to keep buying full-blown computers?

Google argues the former. While Windows PCs won’t go away, Google’s thinkers believe a lot of folks would be happy with a simpler, more affordable computer that just gets them online. Considering how netbooks have become the hot ticket in the PC business lately, Google may have a point.

But there’s also evidence that consumers aren’t ready to give up our software-packed PCs anytime soon. As we continue to accumulate gadgets like Flip video cameras and iPhones, we’ll need more powerful computers to manage the digital content – something a basic Chrome OS device won’t be able to do.

Brisk sales of Windows 7 and Apple’s (AAPL) Snow Leopard operating system also prove that the PC-buying public can still get excited about slick-looking operating systems that use 3D effects and animation to help users get things done. That’s a welcome sign for a company like AMD, which has bet its future on the notion that the world will keep its healthy appetite for computers with some horsepower.

follow me on Twitter: twitter.com/jonfortt