At some point, manufacturers decided to start making really cheap personal computing devices- not a capability they always possessed (or maybe did, but to a poor extent). About the mid to late 90's computing power had really started to become noticeably cheaper for it's time. Computing power was always getting cheaper but now we had simple GUIs for the general public and sub-$1000 PCs were slowly appearing. Major manufacturers even started selling "internet PCs" (aka internet appliance) - simple x86 computers with weak-middle class CPUs, small hard-drives, and minimal RAM in a low profile package.
Notoriously under-powered, these (internet)PCs were cheap for its time (probably driven by cheaper net appliances - TV, game consoles etc that were web capable) and sold fairly well managing to push the internet a little faster towards mainstream. A good thing too, because if movies and television had their way, people would continue to believe that being connected to a network was like looking at swirling vortexes of equations (Hackers) or caught up in a virtual reality world (Nowhere Man). As a secondary side effect, it pushed the general cost of computing down.
Back then Internet explorer 4 was the de facto browsing experience coming packaged on most machines with Windows 98. Browsing standards were far from uniform then, so even if Netscape was more potent, its presence fell with Microsoft packaging Internet Explorer with it's operating system.
Webpages were a static display at this time. HTML was coming from it's infancy, having basic functionality, and many major websites had strict support for Internet Explorer being the most common browser at the time, failing to work on alternatives when more complex designs and functions were needed.
For the increased capability, more power at lower prices became necessary. Meeting the requirements of "enough processing power", low power consumption, and cheap manufacturing, Intel created the "Atom" processor. The Atom made it's way into the first netbooks - the eeePC - from ASUS in 2007 (a low powered Celeron went in the first model). Netbooks weren't the first push into this level (relative at the time) of portable computing. The Toshiba Libretto was a cute little laptop with fair power (though expensive) and the OLPC XO-1 project spawned a strange looking laptop with a specific goal of being cheap (though not very available). Several ARM based alternatives also existed, though most felt slow and plodding and just weren't popular. The netbook however was a truly successful project gaining momentum over the years as the size, price, and power were a hit. With popularity, the price kept falling, until even the OLPC was not as good a deal. Sales routinely dropped the price under $200, and the popularity even ate into sales of full laptops, driving standard laptop prices down.
The netbook's processor was good enough for most webpages and basic applications. For web use, Flash generally slowed it down (and it's still a resource hog at times today). When cheap tablets became mainstream, the netbook adoption slowed quite a bit, but the ideal of a very low cost laptop computer with enough power stayed. Enter Google Chromebooks in 2011.
The initial Chromebook was much like a netbook in hardware (small and cheap with "enough" power). Netbooks had evolved over time from the initial 7" screen to a near standard 11.6". You could say the research into popular form-factors had been done already, though Chromebooks are pushing larger formfactors today. Acer and Samsung brought their Chromebooks to market in mid 2011, and much of the public looked on with curiosity, early adopters with interest, and many a tech-geek turned up their nose in disgust.
The operating system(ChromeOS) was based on Linux, but the front end user experience was just a browser. Therein lay the buzz surrounding this OS. If the operating system was only good when online, then what was the point if you were offline? Not everyone would have access to internet all the time. While it held similar internals to netbooks for it's time, netbooks seemed capable, simply because of the OS. Most netbooks ran Windows and some ran Linux. Either one gave the user access to regular installed desktop applications. Plus you could always just run a browser for online web-app services. Netbooks did run a heavier OS, so on slower harddrive bearing netbooks, they did tend to feel sluggish.
Towards the end of 2013, Google released an update for ChromeOS where a webapp could run offline, store it's data locally and in general act like an installed application. This was big for the OS, but still restrictive. The apps that can be installed and used offline are web based HTML5 applications. It does open up the usage quite a bit, but not to those dependent on existing software for Windows/Linux/Mac. The current batch of offline apps is still rather limited, and not as efficient as proper compiled applications - for example, doing photo editing. Not much high end variety exists either so we're currently stuck with Pixlr now (May 2015) vs Photoshop, Gimp, RawTherapee, Aperture etc.
As most Linux based systems go Chromebooks were quite interesting to those that liked the hardware, and wanted to open up the OS to being more useful. In ~2012, a project called Crouton started giving people a fairly easy way to making a Chromebook work more like a regular Linux laptop.
Thanks to Crouton, adventurous souls can enable developer mode and have ChromeOS act as a fancy loader to a secondary guest OS. Crouton is a script that manages downloading, installing, entering and managing chroots. A chroot is a change in the environment setup such that all running apps see the root folder specified in the new chroot setup and in general doesn't see the actual root folder and system folders. What this means is you can boot your Chromebook into ChromeOS and enter a chroot which can be a standard Linux install.
Chromebooks can be found new for $150 these days - an astounding price for a decent laptop. While the default OS is still limiting, the use of Crouton can greatly extend the use, by turning the Chromebook into a decent proper Linux laptop (without driver problems since ChromeOS loaded it for you!). In 1998, the Toshiba Libretto cost $2500. Hardly in the same affordability class, but it was a notable attempt at small and light. The eeePC started at $400. Chromebooks started at a similar price, but the price as fallen faster than netbooks, while maintaining a more comfortable level of processing power.