In North America, most rugged notebooks are sold by two companies: Panasonic and Dell. Panasonic, the traditional leader, launched the first commercially successful rugged notebook business in the autumn of 1996 and still has more than half the market for \u201cfull rugged,\u201d the most robust category. Dell is the challenger, with a beachhead in full rugged and a solid position in \u201csemi\u201d rugged, the faster-growing business-class category. I\u2019ve covered both companies over the years. I\u2019ve been to both their rugged labs, drunk their rugged cool aid, ridden their jet skis, eaten their tender sushi, smoked their cigars.\nRecently, I asked each to put forth its current champion for both most rugged and best value, proxies for full and semi rugged. Both companies produce more than just rugged notebooks. In general, Panasonic has the broader line, having been in the rugged business for a longer period. Dell is taking a more focused approach for now.\nAn important aspect of the rugged market is its profitability. A full rugged notebook typically commands three-to-four times the price of a vanilla notebook with the same specs (processor, display, memory). Ruggedization does cost more. Special materials, designs, workmanship, and testing all add to the base expense. But rugged notebooks remain highly profitable, commanding gross margins not obtainable elsewhere in the PC business, which explains what drew Dell and other challengers into the market founded by Panasonic.\nNow, rugged is not for the faint of heart. Designing and building a notebook that doesn\u2019t fail \u2014 even after having been hit, frozen, baked, jittered, soaked and dropped from a great height on all of its corners \u2014 is no mere parlor trick. A number of companies have tried and quit the business. Itronix comes to mind. Augmentix tried on its own for a while. One of its big distributors was Dell, which resold Augmentix products under the Dell brand. Eventually, Dell bought the company, using it as an initial base for further rugged efforts. There are a few others, notably Getac out of Taiwan, which is number three behind Dell in the North American market. Xplore, based in Austin, is the resurrection of Motion Computing, which had a rugged offering in its tablet line. The company is trying to make a go of a standalone rugged business, but continues to struggle. Hewlett-Packard and Lenovo have made noises over time about their rugged efforts, but mostly they have improved the ruggedness of their standard commercial notebooks, passed a few of the rugged test suite benchmarks, and called it a day.\nEveryone is drawn to rugged\u2019s fat margins, but is irritated by having to deliver on the exacting specifications. A rugged notebook belongs in a situation where any failure could be catastrophic, where the extra cost of having one that won\u2019t fail is worthwhile. Think military. In combat, the detailed map of the enemy\u2019s deployment can\u2019t just go black. On an offshore oil rig, the cost of helicoptering in a spare notebook far exceeds the price of having one that works strapped to a crossbeam.\nDell is not a newcomer in rugged. My references go back to 2007, and there were rumblings before that. The company became more visible in 2010 with greater volumes of branded rugged product hitting the market. For Dell, initially, the problem was pragmatic. A number of its large accounts had rugged requirements (e.g., oil companies) for a small percentage of their units. Executives could use anything, but geologists and roughnecks sometimes needed tough ones. On occasion, Dell found itself in the position of having to buy Panasonics and resell them to these accounts. For account control, Dell thought it could do better supplying its own branded units. Over time, Dell has improved its rugged line while slowly expanding it.\nWhich brings us to the current contest.\nPanasonic offered up its mellifluously named Toughbook cf31 as the rugged champ. The base model on this baby has a 2.4GHz Intel Core i3-3110M processor, 2GB of DDR3L-1333MHz SDRAM, a 13.1\u201d XGA sunlight-viewable 1024x768 panel, 320GB HDD (SSD optional), Intel internal graphics, high-def audio, optional optical drive or second battery, a few slots, lots of ports, the gamut of communications options, a dock, and Windows. It weighs 7.9lbs and measures 11.5\u201dx11.9\u201dx2.9\u201d. The simple version of its rugged creds include IP65, MIL-STD-810G, and MIL-STD-461F certifications. Street price for the cf31 is around $3,500.\nDell\u2019s contender here is called the Latitude 14 Rugged Extreme. The base model sports an Intel Core i5-4310U processor, 8GB of 1600MHz DDR3L memory, 128GB SSD, Intel internal graphics, a 14.0\u201d outdoor readable 1366x768 resistive touchscreen display, lots of ports, a few slots, the range of communications, and Windows. Latitude is the commercial lineup. So, the naming convention fits well with the idea of filling out the offering for large commercial customers. But that doesn\u2019t mean Dell isn\u2019t going after state and local emergency services, which, along with military, make up the bread and butter of the full rugged market. The Lati 14 RE starts at $3,584 on Dell\u2019s site.\nJust for a baseline, I configured up a Lenovo ThinkPad T460 with similar specifications to get an idea of the rugged markup. It\u2019s Web price was $859. With instant savings, it was $644.25. The rugged premium at this point seems to be ~4x. More like 5.4x after the promotion. Even after greater bill-of-materials costs, I\u2019m still seeing healthy double-digit gross margins in that.\nWhile both the rugged units are priced significantly above a similarly spec\u2019d ordinary notebook, they are not far from each other. The specs differ slightly, with Dell\u2019s configuration being slightly richer. And while the margins are good, Dell has an additional profit accelerator in the form of its volume buying discounts on key parts like processors and memory, which rugged shares with the rest of Dell\u2019s notebooks.\nIn the best value bake off, Panasonic put up the Toughbook 54 against the Dell Latitude 14 Rugged. In Dell\u2019s naming convention, the business and full rugged models are separated only by the word \u201cextreme.\u201d The 54 goes for $1,327 at CDW online. The comparable Lati is $1,299. Again, note the similar price positioning and the minor spec differences. These units are priced at around 1.5x a normally spec\u2019ed unit. The theory around the semi-rugged market is that it should be larger than full rugged because of relative price positioning, that there ought to be lots of users who need some degree of ruggedness, but not the whole deal.\nGiven the nature of the rugged customer base, which buys in fleets, almost everyone gets a quantity discount. So, average margins are lower than list price would indicate, but they\u2019re still good enough to engage both Dell and Panasonic.\nSifting through the two companies\u2019 own assertions \u2014 laid out in oppo research each has done on the other \u2014 reveals a more refined competitive positioning.\nIn a presentation to analysts last fall, Dell cited survey research of its rugged customer base done by Technology Business Research (TBR). The TBR study showed that Dell ranked #1 in \u201call satisfaction attributes\u201d among competitors, which included Panasonic, Getac, and Xplore. These attributes included \u201cperformance after drops, security, performance after liquid contact, uptime, problem resolution time, hardware durability, support response time, device life, component failure, management software, and warranty coverage.\u201d Other elements in the study cited Dell as a \u201cmore reliable \u2026 partner\u201d and Dell\u2019s lower downtime. Elsewhere in its presentation, Dell emphasized elements \u201cbeyond hardware,\u201d such as service and support, cost, and end-to-end solutions.\nPanasonic took a hard data approach to its comparison, citing confidential research from a rugged specialty third-party hardware testing lab. Pitting the same machines described in this piece \u2014 the Dell Latitude 14 Rugged Extreme and the latest version of the Toughbook cf31 \u2014 against each other, test after test showed the Panasonic unit outperforming the Dell machine. The assessments were mostly on rugged features \u2014 water ingress, drop shock, connector strength, steel ball drop on display, hinge durability, aging simulation \u2014 but included other measures like sunlight viewability and heat dispersion.\nElsewhere, Panasonic argues that its not enough to claim rugged status by asserting passage of various specification tests. A company has to demonstrate how it passes those tests. For example, someone assessing drop test results needs to look not just at the section of MIL-STD-810G under which the device passed, but also things like how many devices it took to pass. The standard allows for up to five devices, but Panasonic says it does all its testing on a single device.\nReaders should think over these claims and decide for themselves what seems meaningful here, but it looks to me like challenger versus incumbent. In their positioning, Panasonic relies on hard test data while Dell makes use of survey results, the value of which is more difficult to assess. Although the two systems aren\u2019t entirely comparable, they compete in the same class, and Dell\u2019s computing component specs are slightly higher while its prices are slightly lower. As one of the largest global PC companies, Dell also touts the comprehensive services umbrella that it can stretch over its rugged products, a clear benefit. And while some customers may prefer a unit that fails less often to one swapped out more quickly, others may feel most comfortable with a company that covers the waterfront on services.