Dell is looking to launch a new generation of netbooks and is looking to Linux to drive the models.

The company is researching the possibility of offering new Linux-based mobile devices called smartbooks, said Todd Finch, senior product marketing manager for Linux clients, at the OpenSourceWorld conference in San Francisco. The company will also upgrade its Ubuntu Linux OS for netbooks to the latest version in the next few weeks, he said.

Smartbooks are netbook-type devices that are powered by chips designed by Arm. The devices mostly support the Linux OS and are designed for those who rely on the Web for most of their computing. Dell couldn't say whether it would ultimately offer a smartbook.

Smartbooks have similar characteristics to netbooks, including cramped keyboards and small screens. No major PC vendor has yet announced an interest in smartbooks, though small vendors are pushing them as an alternative to netbooks, which are mostly based on Intel's Atom chips and come with Microsoft's Windows OS. Many vendors, including Qualcomm and Freescale, are providing Arm chips for smartbooks that could hit shelves by the end of this year.

Smartbooks with Arm chips have inherent advantages over x86 chips like Atom, such as lower power consumption and longer battery life, Finch said. The chips are also becoming more powerful, as indicated by the growing number of applications on smartphones, he said.

"I think it's natural and reasonable for us to begin looking at them as they begin scaling their processors up," Finch said.

Putting an Arm chip - mainly found in smartphones - inside a lightweight PC could provide an early entry point for Dell into the smartphone space, said Jay Chou, research analyst at IDC. Dell has hinted at entering the smartphone area many times, but no product has materialised yet.