Would a Google PC succeed?
Richard Brandt asked me to look over his post on the oft-rumored possibility of a Google PC. I actually opined on this back in January, when the rumors were rife in connection with a supposed Wal-Mart sales/marketing agreement. I concluded that that would make a lot of sense for internet connectivity and student/homework uses (I didn’t consider work-at-home or gaming uses because that didn’t seem a good fit with Wal-Mart). The reasoning I came up with back then looks good in retrospect, with only minor tweaks (e.g., my new reason for not worrying about IE-only websites is the IE emulation capability in Firefox).
Richard, however, goes further, thinking that Google could succeed in PCs used mainly to run word processing, spreadsheets, etc.. His arguments include:
- Google has a well-regarded brand name. Check.
- Google might be able to make them cheaply, and even if they couldn’t, they could contract out the manufacture. Check.
- Google wouldn’t be burdened with Microsoft bloatware, and hence could make really cheap PCs. Hmm. There’s some truth to that, although it also is the case that some of that bloat provides actual functionality. And there might be more actual functionality in the future – e.g., speech recognition.
- Google is great at UIs, and could fix UIs like desktop Linux’s. Umm, I’m not sure Google is particularly great at UIs. But anybody with a decent usability lab should be able to turn out something that is, well, usable. Besides, if you ask my fellow posters on Slashdot, there isn’t anything wrong with Linux’s UI anyway. 🙂
- Their SaaS nature gives Google’s apps a big leg up on Microsoft Office. Hmm. First of all, to the extent you keep data on Google servers, you have to worry about Big Brother. The way things are going, that’s not a concern to dismiss lightly, no matter what your home country may be. That potentially major detail aside, SaaS is goodness. But it would take some pretty clever marketing to convince consumers it was an actual advantage. What’s more, the most obvious area of advantage – collaboration – is one that will also immediately bring privacy concerns to the fore. Assuming consumers actually care about privacy, of course …
As for Google’s ability to execute – well, they’re doing a very mixed job with the Google search appliance. At the high end of the market, it’s a joke, in terms of functionality and marketing alike. But in Microsoft-like manner, it’s eating into the low end due to its price and the company’s reputation.
So I’m not sure where I come down on this, except to ask – is the PC even the right device to think about? Or would a mobile device – video/music player, etc. – make more sense?
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7 Responses to “Would a Google PC succeed?”
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Curt– it’s true that mobile devices would make sense, and Google seems to be moving in that direction. It’s also a young field where Google–or bright young startups–could make inroads. But PC software is still a big business. I’m not about to stop using my PC. I’m a believer in SaaS, so I see a future for Google there.
My faith in Google’s user interface comes from the fact that I find its products easy to use without a manual. And its original interface, its search engine page is the most spare and elegant around. Google knows the value of a spare and easy interface. But I concede that’s different than an application interface. The last version of Linux I tried was difficult, but it’s been a while. What version would you recommend?
Users have shown a surprising disregard for privacy. It depends on Google maintaining a reputation for protecting users’ rights. That doesn’t stop government subpoenas, but I tend to believe that encryption technology could go a long way to solve that problem, if only people would learn to use it properly. Is Google working on any internal encryption software?
Your comments from January are right on the money. Except for the skepticism of Microsoft-like PC software.
Thanks for the comments!
Richard,
I have no independent thoughts about desktop Linux interfaces. Go ask somebody geekier than me about that.
I agree that privacy is currently almost a non-issue, but the tipping point in public perceptions about that could come at any time. And do you really want your scrap worksheets you use to calculate your taxes out there somewhere were the government could get its mitts on them?
Maybe the tipping point won’t come at all. If people are comfortable with having all their email and IMs stored on Google/Yahoo/Microsoft/whomever servers, and all their transactional information is already in third-party hands, as is their medical info, what’s left to worry about? Hmmm …
A Google PC may or may not succeed a but the crucial issue is that going into a lower margin business won’t add shareholder value at this point in Google’s life-cycle.
I’ve posted more detail on my blog.
Nice article. I was thinking along the same lines for a while.
The more services (Spreadsheets being the latest) I see Google put up for free, the more I get convinced that Google is trying to take Microsoft head on although in a convoluted way. Google is building a brand and at the same time developing many of the tools (some of which cannot be monetized soon and/or easily) we are used to using on our PCs by paying for them.
A way to make Microsoft obsolete is to make the PC (as we know today) obsolete. With all services residing on a distributed server farm (Google bought lot of unused fiber bandwidth also – Dark Fiber), Google can develop and control the communication standards (what Microsoft and Intel did together in the 80s) and later collaborate with firms that can make and sell thin clients to communicate across devices. Google can make a percentage on the units sold and also sell us software bundles (price discriminate) based on what we use and need.
That brings to mind what are they doing selling online ads? This is where I think they are playing a complicated game. Could online ads be a way to make competitors (MSFT) think Google’s into something else or keep them at bay for some time? Does Google think MSFT could gather information about what a user does (preferences based on the Software they use) but could not capitalize on that by connecting end users like you and I with advertisers and products? May be Google is trying to do these two things and more?
Amar,
From a purely rational perspective and as an investor, I would hope Google doesn’t define its objectives in terms of ‘making Microsoft obselete’ as you have suggested. Objectives defined in those terms inevitably don’t emphasise value creation and lead to testosterone influenced and suboptimal decision making and an erosion of shareholder value. Google should continue what it is doing, developing innovative products and extending its lead in its core search business. Whether Microsoft is damaged by it or not is frankly only going to emerge in the next 4-5 years – for now their businesses intersect very loosely.
Microsoft’s single minded determination to crush competitors in the browser market led to it missing out on innovation long term ( how many years till a new IE version ? ) and Sun’s obsession with Microsoft to the detriment of everything else was also one of the reasons for its speactacular downfall. Over-obsessing about a company that isn’t a direct competitor usually seems to guarantee long term failure.
I don’t see the ad model. Context-less ads in spreadsheets and word processors? What’s the point? Ads with context in the same apps? Spooky!
However, the apps could well provide stickiness for things that can indeed be monetized, such as search.
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