Google's Chrome OS: A threat to Intel and the rise of ARM chips

Google's Chrome OS: A threat to Intel and the rise of ARM chips

Summary: Google's Chrome OS, which generated an extreme amount of hubbub, is a defensive move as much as it is an offensive one, say analysts. Nevertheless, Google's move will have a wide impact on the industry.


Google's Chrome OS, which generated an extreme amount of hubbub, is a defensive move as much as it is an offensive one, say analysts. Nevertheless, Google's move will have a wide impact on the industry.

Analysts were handicapping Google's move into operating systems on Thursday and some of the ripple effects they cooked up were interesting (Techmeme). Here are the more notable comments from the research notes:

Chrome OS a boon for ARM chip makers? Goldman Sachs analyst James Mitchell writes:

If successful, Google’s entry into the market could represent a threat to Intel and x86, while opening the door to ARM-based competitors including Qualcomm, Texas Instruments, Freescale, Nvidia, Marvell, and Broadcom. In our view, Intel’s dominance in the PC market has partly been predicated on the lack of viable substitute products for Microsoft’s Office applications. While Linux and other operating systems have challenged Windows in the past (most recently in netbooks), we believe these attempts have failed because of the lack of adequate productivity software that is acceptable and familiar to consumers. More specifically, our recent checks with PC OEMs suggest that the adoption of ARM-based solutions in notebooks and netbooks has been limited largely by the lack of functional Office-based solutions running on ARM-based platforms, as the level of Office functionality on Windows CE and Windows Mobile has been limited at best. To the extent that Google is successful in driving the adoption of Chrome OS and improving its suite of productivity applications, we think this could have significant implications for the semiconductor ecosystem...

For Intel, the success of the Chrome OS could translate into modest market share loss and/or margin compression in the company’s core PC market, as the company could be forced to compete with a number of new, low-cost entrants which are running at a 40%-50% gross margin (versus Intel’s estimated gross margin for Atom of 60-70%).

Google Apps will be a key to success. The Chrome OS could be an avenue to boost use---and possibly revenue---of Google Apps. That said the popularity of Google Apps will directly impact the popularity of the Chrome OS, says Mitchell. To the extent that Google Apps are seen as a substitute for Microsoft Office the more likely the Chrome OS is adopted. That's a key point.

Stifel Nicolaus analyst George Askew writes:

In our opinion, the adoption of the Chrome OS could speed the adoption of the company's Google Apps web-based software.

However, let's not get carried away. Today, Google Apps just isn't a complete substitute for Microsoft Office. Google says that its apps beyond email and calendar need work and so do enterprises. Meanwhile, enterprises are wary of cloud apps and no one has tolerance for incompatibilities for that stray spreadsheet.

Also see: All Chrome OS posts

It's still about search. A few analysts noted that Google may be trying to play a little defense. By launching an OS, Google is hoping to prevent Microsoft from using Windows to promote Bing. Piper Jaffray analyst Gene Munster says:

In theory, allowing/encouraging consumers to spend more time using applications on the web, like Google's Gmail and Docs products, consumers will be exposed to more advertising, through which Google intends to monetize.

Topics: Software, Apps, Browser, Cloud, Google, Hardware, Intel, Operating Systems, Processors

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  • But does it run Flash?

    I figured I would chime in since people feel that it is the OS writers issue to provide Flash compatibility - witness all the users griping about lack of FLASH in the Iphone, Android and Windows Mobile.
    Get Flash and ChromeOS might be a tough one to beat
    • flash

      why would you want flash? the ressource hog that brings you all those
      you annoying ads. for video? there is a better way for internet-video, it is
      called h.264
      • Would love to see H.264 eliminate Flash

        but unfortunately, my daily life is lived in the real world where zillions of web sites use Flash for menus, item lists, catalogs, demonstrations, vlogs, and many other things. I avoid Flash in the sites I program, but too many use it already. So until the day when it finally dies a horrible stinking death, I still want it on my iPhone 3GS.
        • Flash for navigation = abomination

          Flash navigation breaks tabbed browsing. Flash only makes sense for delivering video. Use it differently and it breaks web standards and conventions.
          • Firefox 3.5 Plays Video as a Open Web Page! :D

            The future is open and no doubt Google too will climb onboard the Open Web Bandwagon to no longer pay those fees to Adobe!

            Daily Motion already has Flashless video that at this time is only played in Firefox 3.5!

      • re: flash (Flex)

        Don't tell that to all the up-n-coming Flex developers. While I use a Flash blocker for daily web-browsing, Flex is a new-ish language that you code OO-ish into an IDE. Then you compile it to flash file (SWF?).

        Then you can run it from a browser, which needs a flash player obviously.

        These flex apps are very useful and powerful (DB backend) and sexy. I'm thinkin Flash aint goin nowhere anytime soon.
    • Threat to Intel? LOL

      That's like saying somebody opens up a store and then instantly becomes a threat to Walmart. Come on now.

      And I don't understand how Google Apps have anything to do w/ processor level competition. Those Apps are just HTML + JAVASCRIPT which have close to zero bearing on the underlying processor they run on b/c they are far higher in the architecture graph. Come on now again, get a real expert evaluating this thing.
      • kind of

        Yes, the web pages are just HTML + Javascript, the actual apps are run on the server. So, you do not need the processing power on your local machine. Just because you don't understand something doesn't mean you have to come out swinging.
      • Google Apps are substitutes for Office

        You are right in that the underlying processor does not determine whether or not Google Apps runs, but I think you misinterpreted the author's point. The reason X86 processors have been dominant is that there were popular applications, such as MS Office, that run only on Windows (without any emulation software), and in turn only on X86 processors. That would change once Google Apps were accepted as viable substitute for Office, since Google Apps are processor agnostic. It creates a level playing field, and that will work in the favor of ARM, or any other processor that is efficient and runs Chrome OS.

    • Hero has Flash

      The official Cupcake release of Android does not have Flash, but the leaked betas of the Hero's SenseUI do have Flash lite or something. I haven't given it a full up test but it has worked where I wanted it. The crossword game I play regularly works at least.
      Michael Kelly
    • Yes.

      You are correct, it has to run flash.

      I have heard that the Qualcom ARM netbook plays flash well. If these "netbooks" play flash, connect easily, run your music library, and of course, facebook, myspace, twitter, they will meet the needs of 3/4 of the population. Yes,Google will want you to use their apps, however, ARM port of OO will be available.

    • Lack of flash on the iPhone seems to be an AT&T issue.

      It's not a tech issue with the iPhone platform. AT&T and/or Apple just don't want Flash to work. EOS!
      No More Microsoft Software Ever!
      • They didn't want us to have MMS or native apps, either

        While everybody with a $29 phone was happily snapping photos and sending them to us, we had to spend a lot of time and energy griping to Apple about their stupid decision to omit MMS. They backpedaled on their assertion that every application could be done in Safari, too. (I'm guessing that happened the first time Jobs took a cross country flight and realized he couldn't use ANY of his nifty browser applications while in airplane mode. What a dork.)

        I guess the point is, if enough iPhone users gripe long and loud enough, they eventually do seem to listen to us. After all, the iPhone is the primary reason the company isn't doing every bit as poorly as most other computer companies right now. It's high-profit and it's selling like hotcakes. They want to keep that word-of-mouth iPhone evangelism rolling.
    • But does it run Flash?, wait I got one...

      Anyone hear of OpenOffice and It runs on solaris windows linux... and the cloud...

      Productivity, is ours...we have the tools.
  • Lifting the barrier to entry into the PC Market for Linux

    I seen nothing but good things coming from the news of Google Chrome OS.

    Intel are sufficiently wise to recognize the Linux potential (Moblin, their recent announced partnership with Nokia).

    Intel can't currently compete with ARM's specification sheet, but there is nothing keeping them from obtaining 'mask' licensing and manufacturing ARM chips for Nokia (and other OEMs). Yes?
    Dietrich T. Schmitz
    • I see a two pronged response.

      They will introduce a real dual core intel atom soon, pushing netbooks far into the realm of normal machine processing power. Obviously, it will out-perform ARM by leaps and bounds for the "power user". The other response will be intel atom V2 using 50% less power but offering about 3/4 the performance of the current intel atom. This will likely be tied to increased spec and dedicated media support for their graphics chips.

      Once the dual core (yes I know the current Intel Atom is logical dual core) processor is released, look for MS to "tweak" the netbook specs allowing for Windows 7.

      Problem for Intel is, (and to a lesser extent Microsoft), the Open Source community will and can optimize the heck out of Open Source software to get 12 hour battery life and a decent computer experience. Reverse Moore's law will apply.

      • That is interesting TripleII. Thanks for the Info.

        I agree ARM sips only a few watts compared with Atom or x86. And the graphics core of ARM is a hidden surprise for those who don't know about it.

        Thanks TripleII for your learned response.
        Dietrich T. Schmitz
    • Frankly I see more lock down because of hardware.

      Apple has it down to a tee. Microsoft relies on OEM's but if Apple get's those OEM's to their side open implementation may be done.

      In a year I may become an anti-Apple guy. I'll wait. But ANYTHING is worth removing Microsoft as the defacto money maker.

      Perhaps all of this will make buyers realize they MUST DECIDE on their OWN and not let stores and OEM's make the Operating System decision for them!
      No More Microsoft Software Ever!
      • Too true.

        Dietrich T. Schmitz
  • RE: Google's Chrome OS: A threat to Intel and the rise of ARM chips

    Hey, guys... ever heard of XScale?? Intel jettisoned the tech 'cause it was worthless...

    As for the Chrome OS, I sense a fail on that part... People complain about their current Linux distros with limited compatibility now... this is only going to make things worse. Not to mention there are several times i've had a lack of internet, so online storage would be useless... and isnt there something called Google Gears? isnt that basically Chrome OS (from what I can gather)? All I see is another Linux Distro clouding the waters... with an even more restricted core that would make it less compatible with even linux apps... To maintain that you'd need x86 arch... so that would make the ARM OS gimped and the x86 distro still worse off than Ubuntu/etc...