Thursday, July 09, 2009

Google: Chrome OS will be free, with major PC vendors on board

In a follow-up post this afternoon, Google confirmed that its upcoming Chrome OS will be available free of charge. The company also listed some of the partners it has lined up to work with the new operating system -- including some well-known PC vendors.

The details further illustrate the potential for the new Google operating system to alter the competitive landscape for Microsoft Windows. Google said Acer, Adobe, ASUS, Freescale, Hewlett-Packard, Lenovo, Qualcomm, and Texas Instruments are among the early partners.

Google had previously hinted that Chrome OS would be available for free, and even before the confirmation this afternoon, that's what analysts were assuming. The idea isn't to make money off the operating system, but rather to help Google improve the Internet experience and deliver targeted ads, said analyst Mark Mahaney, a director at Citi Investment Research, in a note to clients earlier today:

"We neither expect the Chrome OS to generate material revenue near-term, nor do we expect Google's Chrome OS investments to materially impact its current cost structure. We wouldn't be surprised if Google gave the Chrome OS to OEMs for free, as they currently do with Android and their mobile partners. To be successful in selling an OS to full-powered PCs, Google would potentially need many large OEM partners, as well as a robust after-market support and services network, which would take significant manpower, $'s and possibly years to build out, in our opinion. This doesn't seem like Google's playbook."

Microsoft isn't commenting on the Google announcement. Google says Chrome OS will initially be targeted at netbooks when it debuts next year, but there's nothing to stop it from spreading to all sorts of computers. At the very least, the introduction of a high-profile, alternative operating system promises to give new Windows president Steven Sinofsky a major new competitor to wrestle with.

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