Google Chrome Threatens Microsoft Windows in the Long Term

Microsoft and its Windows operating system could potentially face a long-term threat from Google Chrome OS, the search engine giant’s newly announced operating system initially intended for mininotebooks, known popularly as “netbooks.”

Google’s announcement of the operating system, which it plans to make available to consumers in the second half of 2010, certainly contained tidbits of information to make Microsoft pause.

“Google Chrome OS is being created for people who spend most of their time on the Web, and is being designed to power computers ranging from small netbooks to full-size desktop systems,” Sundar Pichai and Linus Upson, vice president of product management and engineering director, respectively, for Google, wrote in a July 7 posting on the Google corporate blog. “While there are areas where Google Chrome OS and Android overlap, we believe choice will drive innovation for the benefit of everyone, including Google.”

By targeting its initial efforts on an open-source and lightweight operating system for netbooks, Google manages to largely avoid having to deal with the messy world of OEM peripheral vendors, as well as the ecosystem of high-powered desktop machines where Windows has a demonstrable market lock.

According to Microsoft, some 96 percent of netbooks currently run some version of its operating system. However, that number does not fully account for devices being purchased with Windows installed and then wiped to make way for an open-source operating system such as Linux.

Netbooks represent an expanding part of a PC market otherwise hit by the global recession; if consumers keep purchasing them as a cheap alternative to traditional desktops or laptops, some analysts believe the Google Chrome OS could become more of a thorn in Microsoft’s traditional domination of the consumer operating system market.

“[Netbooks are] an important sector of the market. I think consumers buying a netbook aren’t looking for a cutdown experience; they’re looking for a cheaper PC,” said Michael Silver, an analyst with Gartner. “That makes [Chrome OS] a long-term competitor to Microsoft; in three to five years they could become a significant part of the market.”

Google’s recent announcement, however, is unlikely to force Microsoft to adjust its Windows 7 rollout strategy. The new operating system, upon which the Redmond, Wash., company has pinned many of its hopes following the less-than-spectacular life cycle of Windows Vista, is slated for release Oct. 22.

“That would be playing into the Google hype,” Silver added. “Microsoft needs to keep its eye on Windows 7 and make sure it’s coming out on time and that it has great compatibility. Right now there’s no product for them to respond to; it’s just an idea.”

Indeed, Microsoft could choose to wait to see how well Google fares in its brave new world before engaging in some sort of response.

“Microsoft will need to respond in some way. In the best of worlds, it would lose some of its monopoly pricing capability and be forced to price more competitively,” Roger Kay, an analyst with Endpoint Technologies Associates, told eWEEK. “But I think Microsoft is going to wait to see whether this new OS of Google’s has any legs.”

Despite the instant hype attached to any new Google rollout, the search engine giant still faces what Kay described as “tough spadework” if it wants to present itself as a viable alternative, particularly if it tries to expand into the more high-powered PC market and wrestle with OEM peripheral vendors.

“Anything purely cloud- or Web-based relies on an assumption of perfect communications: fast, ubiquitous and reliable, which still isn’t what we have,” Kay added.

As of this writing, Microsoft had still not offered official comment on Google Chrome OS.