Android and Chrome OS – Really a two horse race?

This Tuesday, Google revealed more about Chrome OS, though it remains likely at least 6 months away from anything available commercially. For now, it’s prototype and beta testing time.

One of the most common questions I’ve heard about Chrome OS is, “Why? Google already has an OS. It’s Android.”

Recall Google’s mission statement:

To organize the world’s information and make it universally accessible and useful.

Noble goal, and seemingly altruistic. But at the end of the day, Google makes revenue not from web searches, but through advertising displayed on the results of those searches. In short, every moment of face time you give Google or one of their web properties is an opportunity for ad revenue for them. In addition to being smart about search results, Google is smart in that ads are only served to you if they stand some chance of being relevant (cynically, one could say, “some chance of monetization” instead).

The more time you spend online, ideally having something to do with Google’s properties, the happier Google is (because they have a better chance of monetizing you). People expected that Google would have a hissyfit because telcos are bastardizing Android instead of shipping it in the “pure” form offered by Google in the form(s) of the Nexus One and Nexus S. Google hasn’t. Why would they? Unlike Apple and Microsoft, their imperative isn’t the purity of the platform. It’s that more users are online, and more often than not, by being connected directly to Google’s services. Apple will only sell you their mobile OS if you buy their device, Microsoft requires manufacturers to pay royalties for Windows Phone 7, as they did with Windows Mobile. Google? Android is completely free for manufacturers to use. Because that’s not where Google sees, or gets, value in the transaction.

Think for a second – effectively every product Google makes is dedicated to getting you, or keeping you, on the Internet. The Chrome browser isn’t setting speed records because Google cares about you in a deep, meaningful way. It’s to make the time you use on the web, and on your computer, so painless and effortless that it becomes the way you always do things. Google’s true mission statement could to some degree actually be reduced down to:

To become your conduit and guide to everything, via the Internet.

Though both based upon a Linux kernel, Android and Chrome OS are totally different. Android uses packaged binaries and some web applications. Android is a great mobile platform, and I think it will wind up adapting well to be a strong tablet competitor to the iPad, and continue to pull ahead of the iPhone in net sales, if Google’s partners realize that that is what their competition is. Google doesn’t care. It’s not about devices in hands. It’s about traffic coming from those devices. It’s about more people using their Android or iPhone on the road. Android is mobile devices, today. It’s the here and now, optimized for mobile devices.

Early in 2009, Google first mentioned Chrome OS – immediate confusion set in. Why? What is this? What about Android? How can you beat Microsoft at the desktop game? Cynics abound when it comes to Chrome OS – and frankly I’m still on the fence – Google has a lot of really gory technical work, and some huge barriers of entry. But Chrome OS isn’t about now, about displacing Windows immediately. Chrome OS is tomorrow, it’s tabula rasa. It’s about 3 years. It’s about 5 years.

Chrome OS takes the huge bet that everything you need to do can be done in the web browser – and for a lot of consumers and some knowledge workers, that’s true today, even if you have to include Flash to do it. Don’t believe me? Watch this (rather pedantic) Google video “introducing” Chrome OS. It’s about appealing to the cadres of consumers who use Windows to connect to the Internet, search the Web, send email, print documents and pictures, and get directions to the new restaurant. It’s about doing the same thing to the home computer that Apple and Google have done to the phone – turning it into an always-on appliance that just so happens to really, really want you to spend all of your time in Google’s browser, connecting to their services. Odds are, if you’re reading this post, you’re potentially not a logical customer for Chrome OS, unless you’re already “all-in” Google’s cloud (or other Internet-only services) with little or no dependency on local software. Geeks everywhere note that Chrome OS won’t be able to play their legacy games or run Photoshop. That is true – but it’s also a red herring. Not every consumer runs hardcore games (if they did, everything Dell sells would look like a gaming rig) and not every consumer edits (let alone digitally stores) their own photos. Note that if you think Chrome OS is insane in it’s approach, you should consider the RIM PlayBook and it’s AIR-based UX insane too – it’s got the same long race to run in order to win (realistically the iPhone and iPad did too – they started with no apps or extensibility at all).

Success with Chrome OS to Google looks like more and more consumers having an always-on connection, straight to Google, and enterprises where Google gets revenue by providing cloud services that also keep users always on the Internet, always in a browser. Some have even theorized that Google might subsidize Chrome OS systems (especially to consumers) in order to build a market. It might be an interesting loss leader, but it would be a huge gamble – but they’ve done that before. Google also has considerable work left before next year to add device support, so consumers can plug in some level of peripheral devices (cameras, etc) and use them in concert with the device. Like many pundits, I believe this is one of the largest challenges that Google will face with Chrome OS, and it’s significant.

So is it a two horse race? Sure it is! Because Google doesn’t care which horse wins. They’re not even in that race, but they’ve bet on almost every horse in it – they get revenue regardless, unless someone can beat them at search. It’s the same reason why Google has free food and snacks all over campus, and almost any employee at an Apple store can serve as your cashier – anything that keeps you from breaking out of the thread you’re in keeps you on that thread driving it to completion, and in Google’s case, usually drives regular monetization.

Take a look at the timeline below, including some gratuitous guesses (in gray) I’ve taken as to when I see future major versions of Chrome OS and Android shipping (I see minor updates in between the major versions of each released in 2011 and 2012, of course):

Many have said that the iPad killed the netbook, and there’s no market left for Chrome OS – they can’t – they don’t even know the price yet. If Google delivers a device under $250, it’s in a totally different market than the iPad, with reliability and affordability that Google on Tuesday seemed to say Windows netbooks can’t deliver, and with better usability and extensibility than I believe Linux netbooks can deliver. Chrome OS is in it’s own market – and unless Apple retains and drops the price of the current iPad, they’ll continue to be in different markets. The Chrome Web Store delivers “apps” that will work in Chrome – whether it’s in Chrome OS or Chrome on a Windows or Mac system. Over time, expect a growing number of “applications” (rich web pages in HTML 5 or Flash) that work in Chrome. I would be surprised if Google does not deliver apps for Chrome on Android with “Honeycomb” (3.0) anticipated in early 2011 (rumored to be more Tablet-friendly than Android to date). With that, convergence of some sorts begins.

In time, Chrome OS will have to extend some local functionality – but nobody, including Google, knows how much. In the meantime, it’s a starting point, while Android can provide for a different market, and will likely grow more and more “Web app” friendly. I don’t see 1:1 parity (with one “horse” going away) anytime soon, or perhaps ever, but if “application” (web app) developers step up to the plate and build applications for Chrome OS and then Android, it makes both platforms stronger. Android is such an immense platform that, if Google does tablet-optimize it and create a Web app store as well, they create a great network effect that will pull app vendors into extending Chrome OS as well.

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