This week marked Apple’s release of the new iPhone 3G with bolstered connectivity and further refinement of the innovative device. While I had to smirk a bit at the iPhone hiccups, the OTHER device that keeps coming up for me (new models, press calls, wife wants one) is the netbook, or whatever you want to call it. It’s got me wondering whether my Linux hopes for netbooks could be fouled up by Apple and its own cross between the iPhone and the MacBook Air? An Apple netbook would be a formidable competitor in the space, which based on the increasing number of products, users, hardware, software and other vendors seems to be growing well beyond niche.

When it gets down to it, netbooks today tend to run one of two operating systems: Linux or Windows. While there is variety and new development on the Linux side — Xandros (which just bought Linspire to build its PC stack that may be tuned for netbooks), Linpus, Ubuntu and other distributions — the Windows side is characterized by that oh so familiar yet aging OS, Windows XP, recently ‘retired’ by Microsoft. A netbook probably could not efficiently run the more advanced Vista, given its resource requirements. Nor would a netbook likely run Windows Mobile, would it?. Windows XP embedded? Perhaps, but again, not exactly the latest and greatest OS and you still run into licensing costs. I also wonder whether a Windows XP netbook would come with an Office trial that turned to nothing? Could a netbook run Office? Should a netbook run Office? Do consumers who pay $300-$400 for their netbooks want to shop for traditional, paid applications, games and other content, or would they rather browse a catalogue of free and open source software that is accessible at no cost? I think Linux has the upper hand in netbooks, and at the very least starts from a level playing field instead of a preinstallation monopoly.

Apple’s entrance into netbooks would change that. Then, suddenly, Linux would face competition from a rival, newer operating system (in fact one that leads in user interface and friendliness). I don’t have any inside knowledge or reason to think such a release is coming soon, and please don’t accuse me of giving this idea to Apple. They have pretty sharp people looking into these things. Nevertheless, I think as HP enters, as Dell enters and as the players already there push ahead, Linux will help to show this is a new, greenfield opportunity. Apple will have no choice but to jump in the netbook game. Then again, it’s hard to imagine something with a keyboard from Apple for anything less than $900.