Could $20 Google Laptop Save PCs from iPad Craze?

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InvestorPlace
The leaders of the PC market are looking to mend their injured market. Apple Inc. (NASDAQ: AAPL ) and its iPad have hurt the PC market considerably, with research firm Gartner originally had predicted a 3% growth for personal computer sales in the first quarter, but recently calculated that PC sales declined more than 1% . But computer makers may be striking back — led by Google Inc. (NASDAQ: GOOG ) and a dirt-cheap laptop. Forbes’ Quentin Hardy reported on Tuesday that Google is going to announce a new laptop PC that runs on the company’s new Chrome operating system. The laptop and online services will be included in a “student package” that runs just $20 per month. This PC, targeted at young consumers, will be followed by a similar package for professionals. As Hardy points out, Google already offers Google Apps—a suite of office tools for word processing, calendars and other services like Microsoft (NASDAQ: MSFT ) Office—for $50 per year, a service package that could easily be amended with the cheap Chrome laptop. An unnamed Google executive, Hardy’s source, said, “Small and medium-sized businesses are banging on our doors to get something like this.” There are many efforts making waves right now in the fight against the surging Apple iPad. Hewlett-Packard (NYSE: HPQ ) is taking a multi-tiered approach, by simultaneously developing its own tablet as an alternative to the iPad (not a great idea) as well as a new line of service-oriented notebook PCs (good idea.) Dell is bulking up its business services, positioning both its PCs and tablets as extensions of those services rather than the core of tits operation. But Google Inc. (NASDAQ: GOOG ) and it’s bargain basement deal may be the best hope conventional computers have amid the tablet craze. If Google’s PC proves as functional as it is affordable, the device should take off with students, businesses and all consumers. Affordability will prove to be the key for the long-term PC market. One of the reasons the iPad is proving so successful is its perfectly positioned price. At $499 for the cheapest model, the iPad represents cutting edge technology at just below luxury item price points. This is why Hewlett-Packard’s new notebook PCs are such a gamble for revitalizing that segment—at $799 and $1099, the ProBook and EliteBook notebooks will struggle to find an audience. Older style desk- and laptops, while cheaper than either those new notebooks or the iPad, are less appealing to the average buyer simply because they seem outdated. An ultra-cheap, simple laptop from Google meanwhile is a very appealing proposition—at $20 a month, it would seem almost disposable, a replaceable utility rather than a fragile piece of high-end technology. Investors can expect Dell (NASDAQ: DELL ), Acer, and the rest of the PC markets leaders—even Apple—to follow in Google’s footsteps if reports of Google’s cheap laptop prove true. As of this writing, Anthony John Agnello did not own a position in any of the stocks named here. Follow him on Twitter at  @ajohnagnello and  become a fan of  InvestorPlace on Facebook.