These were ominous signs for Linux — once the dominant OS on netbooks — and a new report by analyst firm NPD Group has more grim news for Linux on netbooks.

NPD analyzed netbook sales over three months — November, December, and January — and found that 90% of mini-laptops sold in the United States are now running Microsoft Windows. These are US numbers only and while the story could be different elsewhere it can’t be denied that these are bad signs for the future of Linux on new netbooks

In another sign that Linux’s star my be fading, HP has decided to drop Linux as an operating system for its latest range of netbooks in the UK. Computer Weekly is reporting that while Linux is being offered as an option for HP’s new Mini 1000 netbook series in the United States and other countries, the UK is getting Windows-only machines.

HP said XP was chosen to address the needs of the UK market and more worryingly for Linux fans, the company said that Linux won’t be offered in various other European markets either.

The interface is completely reworked from generic Ubuntu with a slick black look and an easy program launcher. As soon as you load up your Mini 1000 Mi Edition you’re met by a web surf engine for instant online access. To the left is an email tool and to the right the HP MediaStyle package.

This impressive looking OS will be preloaded on some HP netbooks but for those that don’t get it, it will be available via the web.

Source: Download Squad

According to Mobile Computing News though, Microsoft is still taking Linux seriously – at least as far as netbooks are concerned. Perhaps not content with an estimated share of over 70% in the netbook market, they have come up with a plan to work their way on to even more netbooks.

We all know that Windows Vista and netbooks are not a good combination. Vista is generally too powerful and subsequently too sluggish on netbooks, demanding resources the majority of netbooks don’t have. This is why Windows XP is used with most netbook releases, but XP is not as efficient as the Linux OS. Microsoft has shrewdly opted to solve this problem by optimizing its new Windows 7 operating system to run smoothly on netbooks.

Windows 7 is scheduled for a full release in 2009 and is expected to be a lot better in terms of CPU usage and system memory usage compared to Vista. With that in mind, things look pretty grim for Linux, which could find itself truly demoted to a place on the netbooks of the niche, hardcore consumer.

In Acer’s case, and we recently learned that they now have the biggest share of the netbook market, sales of Windows machines are outnumbering sales of Linux machines by more than 9 to 1!

It was basically a one-horse race in the netbook market until this April, with everything running Linux. The decline from Acer’s perspective has been staggering; now, less than 10% of its outgoing netbooks are running Linux, meaning more than 90% of new sales are running Windows XP Home.

Henry Lee, the senior product manager at Acer Computer Australia, told ITWire that not just in Australia but worldwide, Windows version sales are crushing Linux version sales, and that Linux machines appeal more to the niche, hardcore consumer who like to customize their system.

The first positive is what you see when you lay eyes on this VERY appealing model – the sleek and slim design with the glossy 12.1-inch screen. The battery life is also said to be excellent, with each charge of the six-cell battery lasting more than five hours. The keyboard is also easy to navigate and almost full sized, although as I mentioned briefly on Friday, there are many of us wondering exactly what the heck a netbook is anymore and if they shouldn’t just all be generically named subnotebooks now that new releases are reaching 12-inches in screen size.

The major negative with the Inspiron Mini 12 is reportedly very sluggish performance under Windows Vista. Vista is a hog even on many higher spec PCs, so on this model with a 1.6-GHz Intel Atom Z530 and 1GB of RAM, it leads to quite a wait. Joanna wrote, “it took over 2 minutes to get the the Vista desktop and over 4 minutes before all of the preinstalled programs, including the Dell Dock, loaded“, but also thinks that with some tweaking and removing some of the preinstalled software, it might speed up. The hard drive is also slow to perform, so for those demanding faster performance, this may not be the ideal model (at least not with Vista installed).

At a recommend retail price of $654, this is pretty pricey and the model doesn’t seem powerful enough to run Vista efficiently. The good news is that Dell will start offering the Inspiron Mini 12 with Windows XP or its customized Ubuntu Linux operating system from next month, which may turn it into a better performing model and one that lives up to its sweet look.

An Asus official has said that response to Linux in the country has been poor, so the company has decided to eliminate the option and make the Philippines a Microsoft mad nation, with all of Asus’ efforts from now on set to be put into Windows machines.

One of Asus’ original reasons for using Linux, like other manufacturers, was the extremely cheap cost of loading computers with them, but Microsoft – ever conscious of the market – is now offering discounted Windows XP licenses for netbooks and other “ultra low cost PC” makers. If this is a sign of things to come across the world, the story on netbooks threatening Microsoft’s profits may be made null and void quickly. But who would expect anything less of Microsoft than to quickly solve a problem?

The article cites netbooks as the fastest-growing segment in the PC industry and claims that their emergence is eating into Microsoft’s profits. Windows sales fell short of forecasts in the last quarter, causing Microsoft to cut growth projections, and actually admit that netbooks are the main cause for this. Netbook manufacturers who do use Windows – still 70% of models (but significantly lower than the 90% of PCs that also use it) – tend to use old versions of the operating system.

Microsoft is taking this seriously and is already taking steps to ensure it is ready for the netbook boom. Windows 7, the scheduled successor of Windows Vista, will work much better with netbooks according to Senior Vice President Jon DeVaan. DeVaan said, “People will be pleasantly surprised and excited” by how Windows 7 runs on low-cost machines. We’ll do well on those kinds of machines.”

Despite Microsoft’s initiative to stop this growing problem, Bloomberg claims that Windows will still be a tough sell for PC makers trying to develop the cheapest machines possible. Jenny Lai, a Taipei-based analyst at CLSA Ltd., says that Linux costs just $5 to put on computers, compared to with $40 to $50 for XP and about $100 for Vista, a huge difference.