In the July issue, I tested HP’s Mini-Note—the small, cheap notebook is HP’s answer to the subcompact, sub-$500 Asus Eee PC. HP’s tiny notebook got me thinking about the point of diminishing PC returns—the point at which adding more hardware oomph doesn’t deliver a perceptible performance boost to the user.

During the usability portion of my testing—wherein I use the laptop in a variety of real-world scenarios (at my desk, on the kitchen table, on the couch, on the plane, etc.), I was shocked that the Mini-Note seemed fast enough for much of what I do. While the notebook certainly underperformed in our Photoshop benchmark, I didn’t have any major complaints with its performance in my most common activities: web browsing, checking email, writing documents, and listening to music. Is this Mini-Note’s 1.2GHz VIA C7-M CPU fast enough for me?

Answer: no. After I dug a little deeper, I uncovered some serious performance problems. The rig is simply too slow to play H.264 video at DVD resolution, and without dedicated graphics, I wouldn’t recommend running even the most rudimentary 3D games.

The Mini-Note doesn’t trip the diminishing-returns perimeter wire, but it comes close. It’s too bad HP didn’t include decent onboard graphics (something with basic 3D support and a little bit of video decoding help) because that would make this sub-$1,000 rig everything I need in a portable.

Ironically, it’s at the other end of the PC hardware spectrum that I discovered technology that has indeed reached the point of diminishing returns. And I’m sad to report that that technology is 3D gaming graphics. Take a look at two of the biggest games of last year, Call of Duty 4 and Crysis. Crysis is a technological showcase, utilizing the latest, greatest DirectX 10 graphics technology to render a vibrant, living world. Call of Duty 4, meanwhile, is a showcase of last-generation DirectX 9 technology. This game is technically inferior but deftly executed.

Now, were you to show both titles to a gamer who doesn’t know what subtle, delicious effects to look for in DirectX 10 rendering, there’s absolutely no guarantee that he’ll pick Crysis as the more advanced game. In fact, because there are more characters onscreen at any given time in Call of Duty and because the scripted action is much more intense than it is in Crysis, I’d wager that he’s more likely to select Call of Duty as the more visually sophisticated game.

The upshot is that I think we’re rapidly approaching the limits of what today’s technology can deliver in terms of visual quality increases. In order to make the next jump—the jump to real-time 3D rendering that looks as good as prerendered movie CGI—the hardware vendors and game developers are going to have to try something new. Am I right, wrong, or absolutely crazy? Let me know at will@maximumpc.com.