Google's new operating system (OS) has most squarely set it's target on Microsoft Windows, but Apple's Mac OS won't come out unscathed either. Google is a threat to both companies because, while ostensibly this is an operating system for a laptop computer, it is fundamentally a mobile operating system.
Furthermore, whereas Mac OS and Windows have to be installed by disk, Chrome can be installed over the air, which means there will be incentive for all device manufacturers to support the OS and deliver choice to the market. Finally, Chrome OS has social values at it's core and despite Facebook being the leader in social networking Google is well positioned to pioneer a new era of "social computing."
Apple has made great progress into a "sort of" cloud-based operating system with its iOS. However there are three instrumental components to it -- iTunes (account syncing), App Store (software marketplace), and Safari (web browsing) -- compared to Chrome OS's which has only a single essential component, the browser.
Nonetheless, Apple sells products where the hardware and the software ship as a single unit -- so their business model is extremely durable as long as they keep leading the pack in terms of design.
Microsoft, on the other hand, has built it's business on software licensing, where the software is preloaded onto any desktop and the is bundled into the price of the computer. Agreements with huge PC manufacturers has enabled them to grow faster than Apple as they don't need to build or ship any of the products -- and the incentive for companies like Acer, HP, and IBM to sell windows-bundled PCs is strong because the Windows operating system has been seen to be reliable and the Microsoft brand is trustworthy.
When compared to a Mac, buying a Windows PC has always been the cheap and safe option for non-tech savvy users. Equally PCs have a strong following because they are easier to customize than a Mac -- you can build your own PC.
Chrome OS is not yet going to make a dent in the PC gaming market, which requires custom built high spec PCs, nor will it make a dent in large and traditional industries such as finance and professional services - simply because the cost of change is too much in terms of logistics, training and security.
However, in the small business sector, which is already using cloud-based bookkeeping software such as Freshbooks or Evernote, Chrome OS could really take off. The saving on software licenses for fundamental office software is significant alone, but in the long run, Chrome OS powered laptops are likely to be cheaper to buy off the shelf too, as they don't require as much hardware. The cost of synchronizing software and guaranteeing security of every seat in a small business is lowered dramatically by Chrome OS.
Furthermore, Chrome OS could affect Microsoft market share as it reduces the incentive to pre-install devices with any particular operating system and increases the incentive on hardware manufacturers to provide choice. Furthermore, as we're seeing in mobile arena with Android, Chrome OS running hardware may start being bundled with high speed broadband contracts.
Forget Social Networking, Think Social Computing
While there is a lot of fuss about social networking at the moment, the battle lines aren't being fought over who can provide the best services or concepts, but who can scale the best services and concepts.
Currently the winner is Facebook, but Twitter is still in the game and Google's size means it will always have a chance. Apple and Microsoft may yet have some good hands to play also.
Scale is more important than services, because in effect, all social networks are cloud-based programs and can most effectively facilitate the adoption of new cloud services. And over the air software is nothing new -- Microsoft Xbox, Sony PSP, and Apple iPhone have been doing it successfully for a while.
Google's foray into Chrome OS now is the first for an operating system, but it's not so much that they are the innovators but moreso that they can be the innovators - they have proven scale, proven tech teams and the investment to venture into this market. Anyone could have done it before Google and ironically, according to Search Engine Watch writer Thom Craver, Chrome OS is very much a realization of Bill Gates's dream -- and this 15-year-old article in BusinessWeek on "The Software Revolution.""This was Bill Gates' idea a decade ago when he wrote 'The Road Ahead.' He said that the Internet was 'nothing but good news for software' and talked about the idea of ASPs (Application Service Providers) who would give consumers choice from being tied-down to 'bloatware' that was a large investment stuck on their computer. He was the visionary that wanted this and predicted this. And now Google has given it to us."
Google's lack of a social network now could be a first mover advantage in a new era of cloud-based operating systems. It could grab market share in the hardware market where the average customer still perceives a disconnect between hardware, software, and themselves -- so that Google can empower users to personalize devices over time.
The Chrome OS offering stands in marked contrast to all others out there. However, almost certainly all computing will be in the cloud in the future, so aggressive competition will be on its way -- and most likely not from Microsoft and Apple.
At any point Facebook's "superpower-size" population could be a means of delivering a competing cloud OS quite easily. Furthermore, as game consoles have proven, fragmentation in the over-the-air software market is still profitable for niche players. Consoles did it first -- winter holidays 2010 will be see the first cloud-based consoles hit the shops.
Cloud Security & Hidden Costs
An oft-cited benefit of Macs over PCs is that they are supposedly "more secure." This notion has PC users tearing their hair out as it is actually a fallacy.
Mac users' "illusion of security" is actually down to the fact that they have a smaller user base and so are less frequently targeted by hackers. While there might be fewer vulnerabilities in a Mac, there are significantly less threats -- and so it seems more secure.
Equally, the theory goes that a 'thin client' type computer, such as one powered by a cloud-based operating system like Chrome OS should be more secure. The opposite dynamic is effective here.
As Google has a huge user base, but all the core components exist in the cloud, it can identify and eliminate thousands of threats more effectively -- because every attack on one is an attack on the whole. Whereas a virus can attack PC users who have not upgraded their security software; a cloud-based operating system will mean, theoretically, that all users will have upgraded.
However, this isn't necessarily the case, as one of our SEW columnists reported, according to hackers, hacking the cloud is actually very easy. With cloud-based operating systems, one trades up their own security for the security of the collective.
While your personal account may be safe (because less information is stored on device) everyone's accounts may be more vulnerable in the cloud. For further information on this, I sought the advice of SEW writer Kristine Schachinger:"A CloudOS is a pretty way to say 'slave terminal' and in the end, no matter what the benefits, there is just nothing in my mind beneficial enough that would make me give way control of my hard drive to a corporate interest whether it be Google, Microsoft, or some entity we have not though about yet.
In addition, CloudOS systems put all your data out there on the internet in a system of servers which makes it much more enticing to to those who might want it and easier for those who can get it. (IE getting your data off your computer is work for one person's data, but getting into one cloud system and getting data means getting many people's data at one time.)
Finally, it is naive to think the end game of this will not be some payday for the OS companies. I wrote about this and people scoffed it, but Google already charges for its system to corporations and once they convince enough people to give over their hard drives to slave terminals they will make money from it. Whether through data mining, app bills, intrusive advertising, or something we have not thought of yet, in the end you will be giving up your data for their advancement and that advancement will be, in my opinion, monetary. "
Indeed while freemium computers or ad supported operating systems might seem like the obvious choice for the savvy consumer now, it would be foolish to expect computing to be free forever. Economical imperatives will emerge and the customer will have to pay for computing privileges in some way.
Internet security is a classic case and current example. No one is sure how much they really need it, or are willing to pay for it, but everyone buys it because of fear of the unknown consequences of not having it.
We pay out on anti-virus software simply for insurance against a disaster. Put another way, nowadays one would never drive without insurance -- perhaps the same will be true of the web?
It's not hard to imagine a future where everyone is using cloud-based operating systems that are "free-to-use" but everyone is somewhat obliged to pay for security upgrades, or fund the security of the network, in order to be a fair user and avoid unnecessary risks and excessive insurance premiums.
In that way, dependency on cloud computing ushers in a new era of related technologies that will become as normal a part of our lives as fire and burglar alarms -- expect biometrics to be required to lower insurance premiums or guarantee access to high speed portions of the web.
Flash forward into the very far future and our dependence on the grid may be a matter of life and death -- or should that be a matter of society and de-resolution?
While Google and the Chrome OS product aren't solely responsible for this new era in computing, and the potential dark sides of it, they will take the customer in that direction. It's important to realize that while we may be buying cheap, instant on, synch syncing and highly collaborative and interoperable computers now, we may be tacitly agreeing to a digital divide in the future.
Unfortunately, I don't think we have much of a choice -- cloud-based devices seem the way to go and the benefit of collaboration outweighs the relative merits of privacy. Fortunately, I trust Google more than other companies to make the right ethical choices take us into that future.
And I'll probably give in anyway as I wouldn't mind driving a light cycle or being undressed by sexy robots. Is that wrong?
Meet Your Favorite Search Engine Watch Contributors
Many of SEW's leading expert contributors will be at ClickZ Live, the new online and digital marketing event kicking off in New York (March 31-April 3). Hear from the likes of: Thom Craver, Josh Braaten, Lisa Barone, Simon Heseltine, Josh McCoy, Lisa Raehsler, Greg Jarboe, Dan Cristo, Joseph Kerschbaum, John Gagnon, Eric Enge and more!