On the product announcement front, Google used the unveiling of its Chrome OS operating system as an open source platform to give a quick demo of its still-developing features (video). As I highlighted in ContentBlogger in July, Chrome OS, targeted for release next year, will be a computer operating system expressly for devices such as netbooks that use mostly Web-oriented content and applications. The result is a machine that can operate with minimal local data storage and that can boot up to a login prompt in seven seconds and get on the Web in just a few seconds more. So in less time than it takes the typical mobile phone to get ready you can access Web content and applications easily.
The Chrome OS interface is no real surprise to those already using Google's Chrome browser to look at the Web - it is, in essence, the same. There is a permanent "tab" open to allow one to start applications, which operate in tabs much the same as Web pages do currently in the Chrome browser, or you can have the applications pop up from the bottom of the display as "panels." Web links can activate apps as well, such as in the above display, which shows a music clip on MySpace playing after clicking a link on a Google search results page. The demo also showed how data in the Chrome OS "cloud" from any tabbed window can be pulled into Google Docs for more sophisticated manipulation and how games and ebooks from Google Books can be viewed easily and stay as persistent content in a given tab or as full-screen applications.
People expecting the "wow" factor that Microsoft or Apple has tried to engineer into its most current operating systems are likely to be underwhelmed by Chrome OS, a non "wow" factor that was echoed in a recent poll that I conducted in Google Wave. In the poll, only a plurality of people felt that Chrome OS would have a major impact on computing in two to three years. After all, who is going to get excited about an operating system that looks and acts just like today's browsers? I think, though, that this is where the pies come in. With only about a fifth of the world's population having access to the Web, Chrome OS as an open operating system is perfectly positioned to help the other five billion people who do not have Web access to build content in the clouds very cost-effectively. Most of these people will never see a PC in their lives and will find a Chrome OS device to be perfectly adequate. Of the 1.4 billion people who have access to the Web already, most of their time is spent on the Web anyway. That leaves Apple Macs and devices using Microsoft Windows 7 to go after the relatively affluent and sophisticated markets that have a lot of sophisticated gizmos in their homes and enterprises, a significant market, to be sure, but one in which the need for content outside of the cloud will be a diminishing factor. All of a sudden Chrome OS has the ability to make the entire PC-based marketplace look like a niche market.
Underscoring this positioning of an expanded global cloud as an expanded marketplace pie is the recent repackaging of the "Google Phone" rumor by TechCrunch. If Michael Arrington's latest "confirmed, super-high confidence information" is to be believed, Google is going to start advertising a Google-branded mobile phone device in January that will be built by an OEM hardware partner to Google's own specifications. In the short run, one assumes that this will be an "apples-to-apples" competitor for Apple's iPhone, supporting applications and Voice over IP telephony in a way that is less compromised than Google Android implementations found on smart phones released so far. But with heavy investments in Google's Android operating system by handset manufacturers such as Samsung, HTC and Motorola and a still-fragmented U.S. mobile market to navigate, it's doubtful that such a "Google Phone" is going to make enormous headway in developed markets any time soon based on just these features.
Instead, the more likely play for Google's potential phone device is a new market altogether: ad-supported mobile VoIP telephone and Web access. In other words, in the middle of a global recession and with a huge number of people who have yet to touch either a mobile phone or the Web, what better price point for a mobile phone service could you have than "free?" The features of Google Voice already await people needing voicemail and phone call redirection, so people falling off of telephone calling plans as the economy continues to tighten may see access to phone calls through ad-supported broadband and Web "hot spots" to be a "good enough" telephony and Web combination while they await funds to get more high-powered services from major telephone carriers. For those who could never afford or deal with mobile Web access, the Google Phone may offer a simple and affordable way into mobile communications that would be a stepping stone to a Chrome OS-powered netbook device.
All of this in the short term is likely to be fairly underwhelming stuff for people looking for the "what's in it for me for better results this quarter" solution to all of their content market problems. But in a sense that's the exact point. Google is one of the few companies in the content and technology industry that has been investing very patiently in long-term market development goals that will broaden their potential revenue base by huge magnitudes. Others have been innovators, to be sure, and profitable in their own right. But by plodding away at technologies and content services such as Chrome OS, Android, Google Apps, Google Wave and Google Voice, and by continuing to refine existing services such as its search engine, ad networks and YouTube videos, Google learns how to build a larger market in which they can satisfy at least 80 percent of its daily needs.
As Google expands into developing nations and "digital natives" markets more rapidly than many of its competitors, the slice of the "old" 20 percent that can be satisfied by more specialized technologies will continue to look smaller and less powerful as a content market play. With everything to gain and little to lose, Google's greatest barrier to competitive forces is the unwillingness of its competitors to risk everything to play on the same ground. The sophisticates who follow the content industry will continue to be underwhelmed by many Google products and services - until they recognize that in large part it is becoming the content industry as we will know it.