Netbooks in the Enterprise: Get Ready

Netbooks in the enterprise are coming, some observers believe. And whether it takes a year or five for netbooks to catch on in Corporate America, it behooves IT managers to get ready sooner rather than having to clean up a mess later on.

Netbooks in the enterprise are coming, some observers believe. And whether it takes a year or five for netbooks to catch on in Corporate America, it behooves IT managers to get ready sooner rather than having to clean up a mess later on.

Remember, many IT managers initially refused to accept PCs and, later, iPhones for enterprise use. Employees demanded they reconsider and brought the devices in anyway. That scenario could well play out with netbooks, some believe.

Chris Neal, vice president and head of the technology practice for market-research firm Chadwick Martin Bailey in Boston, said that the IT executives his firm has surveyed are "split" on the notion of whether netbooks will make serious inroads into Corporate America. Of the 158 IT professionals his firm recently polled, 25% said netbooks will likely remain a consumer phenomenon, while 21% said the devices will be widely deployed in companies.

So far, around 20% of respondents have deployed netbooks, but on a 'limited basis," Neal said. Although the devices are popular with on-the-road professionals, "they don't have enough horsepower to do local processing," he explained. And with laptops typically priced at only around $200 more than netbooks, corporate buyers are more likely to spend the additional money for a fuller-featured machine, he said.

Slowly making their way

In fact, barriers to netbook adoption are currently the rule for large companies. Hewlett-Packard Co. makes the Mini 2140 netbook. But a corporate spokesperson said that HP's internal IT department does not support or issue netbooks.

Standard IT department objections are around netbooks' consumer operating systems -- Windows 7 Starter Edition in the majority of cases -- that don't connect to corporate networks, and inadequate security. Rob Enderle, president and principal analyst for the Enderle Group, based in San Jose, Calif., suggested that 75% of enterprises have policies demanding TPM (Trusted Platform Module) and biometrics in new laptops. These mandates effectively block the adoption of all current netbooks.

James Brehm, emerging-wireless analyst for Frost & Sullivan in San Antonio, has investigated several netbook pilot projects in large companies, but none he's followed has grown to a larger deployment. "Companies are saying absolutely not, but IT directors are open to new things to help lower costs. The netbook rise coincided with the decline in the economy. This created markets where large companies took a look."

His theory: the pilots are too new to make any real inroads into corporate IT yet.

Maulik Pandya, Dell's senior planning manager for commercial notebooks, predicts netbooks could capture around 5% of enterprise sales -- machines that would have otherwise been laptops. But Enderle disagrees, suggesting that if end-users had their druthers, netbooks would far outpace this 5% mark.

"Small portable computers for less than $400 is where the market should be," Enderle said. "Portability and the price point really tear up the laptop. Many vendors don't want to build a strong corporate netbook model because they don't want to pirate their laptop lines."

In other words, corporate laptops are still far more than $1,000 in most cases, so a $400 netbook makes a strong financial pitch, even after changing the OS at company expense.

Any critical missing features, such as TPM and biometric support, will show up on netbooks when the time is right, said Enderle. "If a customer went to netbook manufacturers with a large purchase order and asked for TPM or biometrics, the suppliers would see that as a trend and add the features."

Pilots in progress

These restrictions haven't stopped some early adopters from implementing pilot projects. Allen Gwinn, senior director and chief technologist for the Edwin L. Cox School of Business at Southern Methodist University (SMU) in Dallas, said next year's new purchases at SMU will trend strongly toward netbooks and away from laptops.

Gwinn's IT group supports the faculty, staff, and network infrastructure -- but not the students -- at SMU Cox. Each school at SMU handles its own technology independently, and Gwinn said he has the only netbook pilot underway at SMU. He's using the Dell Latitude 2100, mostly because of its price tag.

"I have a group of 'guinea pigs' using netbooks now," said Gwinn, who characterized the number as a handful. "Next year they'll be much more broadly deployed. We're finding uses for netbooks that laptops can't satisfy."

For one thing, the small size of netbooks gives them a considerable portability advantage. "One of the faculty travels to China quite a bit," said Gwinn. "I gave her a netbook in a clear pouch, so it goes through airport security faster. She takes it places she couldn't take her laptop before, because she throws the netbook in her purse where before she struggled with the laptop case. Her laptop will never go on another trip with her."

Netbook use in corporations still spotty

So far, it seems netbooks are still mostly a consumer phenomenon, according to a recent survey of 158 IT professionals. Of those who are deploying netbooks, around half said they have implemented to fewer than 9% of their end-users.

Yes, we are currently deploying netbooks - 20%

No, we are not deploying netbooks and have no plans to do so - 29%

We're not deploying netbooks but have plans to do so next year - 13%

We're not deploying netbooks but have begun to consider doing so - 38%

Source: Chadwick Martin Bailey

Endele has seen that type of result in his research. "Netbooks are designed and optimized for portability," said Enderle. "Women prefer these five to one over laptop computers."

Jason Ashton, founder and CEO of Enterprise Mobility Solutions in St. Louis, said his company is rolling out over 100 netbooks, a mixture of Dell and Lenovo units, for a large bank in St. Louis that he would not name. The netbooks will be used by the sales force and by couriers working for 35 branches of the major regional bank, Ashton said. All the netbooks will have mobile broadband service from AT&T.

"All have a SIM card, and they can text just like a cell phone," said Ashton. Some customers have loaded a soft phone to catch calls forwarded from the office, but that's not part of his deployment guidelines. Soft phones consist of VoIP software and a headset to be able to send and receive phonecalls via the netbook.

Brehm from Frost & Sullivan said only about 10% of all netbooks sold have embedded mobile broadband capabilities. Of those, only 7% of customers have turned on their mobile broadband.

Performance and size: Both can surprise

Gwinn said most netbooks' performance will never win awards, but that's okay with him. He said his users spend the majority of their time with netbooks checking e-mail, Web surfing and maybe doing some light work with a Microsoft Office application.

But don't underestimate netbooks' power, Gwinn said. One faculty member cranks huge SAS models and asked for something that could handle that and still be portable. "We couldn't find a laptop powerful enough for him to do his work at home," said Gwinn. "So we gave him a netbook. He uses the remote desktop feature to connect to his desktop machine in the office."

The flip side of netbook portability is the devices' smaller size. When some people complain about the small screen, SMU's Gwinn just laughs. "People are browsing the Web all the time on their iPhones, and that screen's much smaller than a netbook."

Ashton shows customers a smartphone in one hand and a netbook in the other. Viewed together, the netbook screen and keyboard look huge.

That sweet spot works great for one of Gwinn's guinea pigs at SMU. "We're using a netbook for risk management. Our fire safety guy had to carry a laptop because a PDA was a little too small for the application. But a netbook fits elegantly in the middle."

The operating system issue

Despite netbooks' fans and advantages, IT leaders in large organizations will need to carefully think through some issues even before beginning a pilot. Key among them is the operating system issue. There has been some debate about whether Windows or Linux will ultimately win out for netbooks in the enterprise. But whichever direction they head in, companies will likely need to do something to replace the consumer versions most netbooks come with.

In the bank's pilot project, Ashton said, Windows XP Home operating systems are being upgraded to Windows XP Pro. "We're just about to start working on Windows 7," said Ashton. While a couple of IT technicians upgraded their netbooks to Windows 7, the rest of the units were upgraded to Windows XP Pro. The bank used their master Windows license, same as for their desktops, so the extra cost was minimal, and not part of Ashton's responsibility.

Companies with corporate Windows licenses from Microsoft can replace the netbook OS at no extra cost besides the use of a license. Vendors will charge extra to replace XP Home with XP Pro or Windows 7. Dell charges $65 to put either Windows 7 Professional or XP Professional SP3 on its netbook.

Neither XP Home nor Windows 7 Starter editions have the right client software to connect to Microsoft's Active Directory. Linux does, but it's still unclear whether large companies will adopt Linux on netbooks.

Dealing with security

Security issues can also be worked around. Although the bank in St. Louis that Ashton is working with has a security policy requiring TPM and biometric support on laptops, netbooks being deployed were deemed security compliant when managed by AT&T's Device Protection and Control application.

"Think of that software like the BlackBerry Enterprise Server management tools," said Ashton. "The bank manages all of their netbooks through their AT&T portal, like they do their smart phones. They upload policies, find lost devices, and can remotely wipe devices if needed."

For biometric fans, the new Lenovo IdeaPad S10-2 netbook includes VeriFace facial recognition software that leverages the built-in Webcam for authentication. Ashton said the Lenovo units for the bank included the VeriFace software.

For his part, SMU's Gwinn said he has security covered. "We use PGP full-disk encryption, which doesn't need TPM and works great. If someone wants a biometric reader, there are external ones."

Another tactic is to avoid any security problems in the operating system by avoiding the operating system in the first place. DeviceVM makes Splashtop for instant-on computing, which it licenses to netbook manufacturers. Splashtop includes VMware and Citrix clients, as well as a browser, all separate from the underlying operating system.

Splashtop is a Linux-based pre-boot operating system that runs a few functions without starting Windows. "Dell, HP and Acer are implementing our instant-on technology into business product lines that will be shipping this year, including some netbook models," said Steve Rokov, senior enterprise marketing manager for DeviceVM.

He added, "We're working on pilots in the financial services business to integrate netbooks into the approved list for purchase." The security layer provided by Splashtop, along with the thin client nature of the netbooks used in the pilot, eliminate the need for TPM support in the eyes of their financial services customers, he said.

"Some consider these more secure," said Rokov. "If you have some disk problems, we can still start our pre-boot operating system that's malware resistant. Depending on the configuration, you may still be able to get online if your Windows goes down."

Remember the notebook wars

According to Frost & Sullivan's Brehm, "Enterprises have adopted the same policies for netbooks as they had for laptops."

Brehm should know -- he uses a netbook in his office even though the official Frost & Sullivan policy says 'no netbooks.' He originally started using a netbook when his laptop needed to be repaired, but now prefers the smaller machine.

"I've bought three netbooks over the past year and a half," said Brehm. "My personal Acer netbook was granted a variance for work."

Company policies on laptops, and therefore netbooks, cover a variety of areas, including theft prevention, protection against data breaches if the unit is lost or stolen, and which models are approved for employee use. While some companies may allow employees to purchase a device of their choice, most organizations still provide a list of acceptable hardware options.

Personal netbooks fall under the same rules regarding company data compliance as do personal laptops. If your policy demands that laptops belonging to terminated employees must have their hard disks wiped before leaving the premises, personal netbooks should be held to the same standard, analysts pointed out.

Companies are going to have to decide how to handle the issue. "Like with the iPhone, do you buy and provide the hardware for the employees, or let them bring in their own hardware and write changes to your policy?" asked Brehm.

Enderle advises enterprises to become proactive before it's too late. "Netbooks are coming into companies already, often purchased by line departments in defiance of policy. IT should go to the departments and outline which models are acceptable and which aren't, for easier support of future netbook purchases."

"If' someone's going to make you eat something," said Enderle, "talk to the cook and see if you can make the meal palatable."

- Johanna Ambrosio contributed to this story.

James E. Gaskin writes books, articles and jokes about technology from his home in the Dallas area. Contact him at readers@gaskin.com.

This story, "Netbooks in the Enterprise: Get Ready" was originally published by Computerworld.

Copyright © 2009 IDG Communications, Inc.

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