Microsoft CEO Steve Ballmer recently gave a presentation in which he said that GNU/Linux has more market share and poses a greater threat to Microsoft's profitability than does Apple.

Last week I made a summary of the current state of the Linux netbook market. Today I will show you that Linux netbooks are at a crossroad. They can reach a bright future and a significant market presence through 3 different paths: the smartbook path, the cheap path and the power path. I will explain how each path will lead the Linux netbook to market dominance in a specific niche.

The past couple of weeks saw a flurry or articles debating the future of Linux on netbooks. Stephen Lim, the General Manager of Taiwan based Linpus Technologies, made the surprising prediction that Linux will regain 50% market share from Windows on netbooks by next year.

When it launched the netbook phenomenon a couple of years ago, the most noticeable thing about the Asus EEE PC, apart from its size, was that it typically ran Linux. Suddenly everyone was predicting the demise of Windows and the rise of Linux.

Back in February I wrote about how Linux had gone mainstream as netbooks became ubiquitous. Nobody doubts that Windows has captured the overwhelming majority of the netbook market. Even so, Dell claimed around that time that one third of their Inspiron netbooks were selling with Ubuntu preloaded rather than Windows XP.

One of the most touted advantage of Windows 7 over Windows XP and Linux is improved battery life. This may be trues for newer netbooks that would be optimized for Microsoft new operating system, but don't expect any gain from installing Microsoft's latest release on you current netbook! Many people have actually reported reduced battery life on their netbooks after an upgrade to Windows 7.

The anti-Linux propaganda du jour, being dutifully parroted by "news" publications everywhere, is that Windows now owns 96% of the netbook market, and that Linux netbooks are returned four times more than windows netbooks. Both are untrue and have been debunked repeatedly. Yet they persist-- why?

Over the last 12 months, netbook and mobile Linux has made massive advances in features and install base. This is primarily thanks to two netbook distributions – Moblin and Canonical's Ubuntu Netbook Remix (UNR). Both have built on the massive potential that was unlocked by the Asus Eee PC but led nowhere, as its operating system failed to inspire a new generation of Linux users.

When the netbook first arrived onto the market at the backend of 2007, it came riding with Linux in the saddle. Now 18 months on and Linux-preinstalled netbooks are as rare as hen’s teeth. But which operating system is really the better option?