The folks at Bernstein Research today offer up a longish — 33 pages — report on the prospects for personal computers and other devices running Microsoft’s (MSFT) Windows 8 operating system, coming later this year, on chips that use technology from ARM Holdings (ARMH), as opposed to Intel (INTC) or Advanced Micro Devices (AMD) chips.
The team, consisting of Alberto Moel, Mark Moerdler, Pierre Ferragu, Stacy Rasgon, Siu Choon Koay, Jasmeet Chadha, Emily Chan, and Jonathan Cofsky, concludes that just the prospect of ARM-based Windows machines “meaningfully modifies the current equilibrium of the Wintel ecosystem.” The team estimates that notebook computers with Windows on ARM, or “WARM,” as it’s known, could be 10% cheaper, on average, than Wintel machines.
“Assuming ARM keeps a structural cost advantage of this order of magnitude, the technology could capture 60% of the sub-$500 consumer market,” the authors speculate.
There is “good development support for new MetroStyle apps,” the team writes, referring to the Metro user interface on Windows 8, that may not help tablets running Win 8, they think.� And that could be important because on price alone, it looks like WARM tablets won’t be very competitive with Apple‘s (AAPL) iOS and Google‘s (GOOG) Android.
On the contrary, Windows 8 tablets will likely have a structural cost disadvantage compared to Android tablets, driven by higher hardware specifications required for Windows 8 certification and higher software costs.
The firm’s favored picks are Asustek Computer (2357TW), Microsoft (MSFT), and Advanced Micro Devices! (AMD), all rated Outperform. Lenovo (0992HK), and Intel (INTC) are rated Market Perform. And Acer (2353TW) and ARM are rated Underperform.
Update: In a somewhat related bit of news, CNet‘s Lance Whitney this afternoon reflected on the patent award given to Apple for a patent on technologies involved in the development of a thin laptop. Whitney wonders whether this and other patents pertaining to the MacBook Air could be used by Apple to thwart the design of “ultrabooks,” a class of laptops being heavily promoted among OEMs by Intel. Ultrabooks are expected to be the flagship mobile platform for Intel-based use of Windows 8.
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