By Tim Weber
Business editor, BBC News website
Google's operating system aims to tempt people away from Windows
So at long last Google is making its move. Promising a lightweight but fast operating system - Chrome OS - the internet search company is poised to strike at the heart of Microsoft's software empire.
The Windows operating system is Microsoft's cash cow, powering about 90% of the world's personal computers, and as a result accounting for the majority of its profits.
The benefits are wider, though. Every Windows desktop comes with an invitation (and at times the imperative) to use other Microsoft software and services.
This, in turn, hobbles Google's ambition of organising all the world's information, and making money on the back of it.
After all, most people's computer experience is bogged down with frustration - from the time it takes to start a computer, to software conflicts, and worries about viruses and malware (or for Apple Macs the cost of buying a computer).
Clash of business models
Google promises to change all that by stripping desktop computing to its basics. Your PC won't have to do the heavy lifting, applications will run in your browser instead, powered by Google's huge server farms.
It comes down to a clash of business models. Microsoft earns money by charging customers a one-off fee for its operating system, probably $20 for its old Windows XP software, and a rumoured $150 for Windows Vista and the forthcoming Windows 7, which is due to go on sale this autumn.
Google is unlikely to charge for Chrome OS. The company wants you to get online fast, have a whale of a time... and use as many Google services as you can: from search to email, social networking to photo sharing, word processing, to watching films on YouTube.
It is yet another incarnation of the company's "Google everywhere" strategy.
Google, the software firm
Chrome OS also shows what you can achieve when you sit on a huge cash pile, attract some of the world's best software engineers and - most importantly - start with a blank slate.
Google has a track record. Not that long ago the firm announced that it was developing an operating system for smartphones, dubbed Android (which is distinct from Chrome OS).
Microsoft executives that I spoke to back then were dismissive, arguing that Google was underestimating the complexity of such a venture. But already Android is in many ways a more accomplished piece of software than version 6.1 of Microsoft's Windows Mobile.
Google is helped by the fact that unlike Microsoft it has no need to worry about compatibility with legacy software.
That, however, could also be the Achilles heel of Chrome OS.
Consumers who want to buy a Chrome OS computer will have to start with a blank slate as well. Any software that they hold near and dear is unlikely to be compatible with the new system.
And they have to limit their ambitions. If you play computer games, do heavy-duty video or picture editing, or need any kind of specialised software, then you'll return to the shelves heaving with Microsoft powered PCs or Apple Macs.
Timing is everything
As you make your buying decision, you will have this niggling worry that one day, maybe, you will need to use some software that simply can't run in your browser. The advertising campaigns of both Apple and Microsoft will have a great time stoking these worries.
Google's announcement comes at an interesting time. Microsoft is poised to launch its new operating system Windows 7. Unlike its predecessor Vista, Windows 7 is proven to be a good fit for ultraportable netbooks, currently the fastest growing segment of the PC market.
So Chrome OS, due in mid-2010, may come either at just the right time, as the economy recovers and consumers go shopping again, or it may come too late, with Windows 7 already firmly hogging the market.
In the end, Google's strike may not cut deep into enemy territory.
Chrome, the web browser, is still stuck at a tiny market share of 1.2%. Android is available on just two or three phones, not enough to really make an impact.
Google Apps - productivity software to handle spreadsheets and word documents - has just come out of its "beta" test phase, but look around you and you will find most people still using Microsoft Office.
The one field where Chrome OS may make a difference is the market for the open source Linux operating system. Chrome OS will use bits of the Linux kernel, the link between the computer hardware and the Chrome browser running on it.
Google is bound to make Chrome OS much more user-friendly than most "distros" or versions of Linux available right now. Instead of slaying Microsoft, Chrome OS might corner the segment of the consumer space that might have been Linux's.
No doubt, Google's charge with Chrome OS will needle Microsoft. But we won't know for years whether it will deliver a mere pinprick, or is the fine point of the dagger at the heart of Microsoft.