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Google's Chrome OS may have missed its moment

By David Goldman, staff writer

NEW YORK (CNNMoney.com) -- Google has two operating systems. One is wildly successful, and the other may be dead on arrival.

Android, Google's mobile operating system, is the fastest-growing OS on the planet and is being tested out on everything from tablets to refrigerators. It even powers the new Google TV system.

Chrome OS, Google's netbook operating system, still has yet to debut and is targeting hardware that hardly anyone wants anymore.

Nevertheless, Google CEO Eric Schmidt said Monday at the Web 2.0 Summit that his company continues to work on Chrome OS, which he sees as a "very different solution" than Android.

Chrome OS -- based on the open-source Chromium OS project -- will be a Web-based operating system primarily for devices with a keyboard, Schmidt said. Android, on the other hand, is optimized for touchscreen devices.

Some analysts don't think those differences matter so much anymore.

Google (GOOG, Fortune 500) bought Android in 2005, when smartphones were rare and touchscreens almost nonexistant. Chrome OS was announced in mid-2009, at the height of the netbook craze -- before anyone knew what a tablet was. Google said the software would be ready in late 2010, a target the company still says it's comfortable with.

Now, netbooks are fading fast. Uncomfortably sandwiched between laptops and the iPad in terms of computing power, mobility and form factor, the netbook has become a device without a defining trait. The $499 iPad is not significantly more expensive than most netbooks, and many full-on laptop computers are beginning to encroach on the $300 to $400 netbook price range.

As a result, Gartner predicts netbooks will only make up 10% of notebook sales by 2014, down from 20% at the end of 2009.

At the same time, tablets and smartphones are growing ever more similar -- and the browser is becoming the application that binds all connected devices together.

"There will be a place for Chrome OS in the short term, but in the long term, there's enough overlap between Chrome OS and Android that Google will need to combine them," said Ray Valdes, analyst at Gartner.

Chrome OS is unique, because it puts the emphasis on the browser. In fact, that's essentially what it is -- an operating system that makes use of Web-based applications rather than downloaded software. It builds atop Google's Chrome browser, which is steadily gaining market share.

Android does the opposite: It has more than 100,000 apps in its marketplace, which users download and store directly on their device.

But the line between standalone applications and Web apps is about to get blurrier. Right now, mobile developers need to create custom code for every platform they want to target -- which often means Apple's (AAPL, Fortune 500) iOS and Android, plus perhaps RIM's (RIMM) BlackBerry OS, Nokia's (NOK) Symbian and MeeGo and Microsoft's (MSFT, Fortune 500) new Windows Phone 7.

HTML 5, an emerging standard, lets developers build rich application functionality straight into Web applications.

"Writing apps to a third or fourth platform is a big challenge for mobile developers," said Al Hilwa, analyst at IDC. "HTML is going to a big part of the solution. We'll start to see more Web apps and a decline in downloaded apps in the near future."

Those trends suggest Google would be better off focusing on a single operating system, one that can scale from smartphones to larger devices.

Still, Google says it is going forward with its plan to put Chrome OS on netbooks -- and that the software is coming soon.

The company would not comment on the exact timing of its Chrome OS release. In his Web 2.0 talk, Schmidt said it is "coming out in the next few months."

A company spokesman later added: "We are very happy with the progress of Google Chrome OS and we'll have more details to share later this year."

But a source with knowledge of Google's pipeline said a product would be unveiled before the end of 2010.  To top of page

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