Dear Rubi

Rubi Says…

Dear Lisa,

No, of course not.

But why would anyone want to take over the desktop OS business? The center of innovation in software is moving to web applications. That’s where most of the new value is being added, which means that’s where the biggest business opportunity is going to be in the future.

Don’t get me wrong, there will always be a market for OS software to control your PC (or smart phone, or implanted bio-chip, or whatever sort of computer we use in twenty years), but increasingly that OS is going to be just plumbing that sits in the background and serves the needs of the web application world.

Rather than investing in taking over an old business with limited growth prospects, Google is investing in accelerating the commoditization of the OS by encouraging the growth of web applications, providing bits of web application infrastructure like Google Gears, giving away a phone OS, and partnering with companies providing web app infrastructure like Adobe Air. Google wants to bleed the money out of Microsoft’s franchises. That’s why they’re attacking Office as well.

The question you didn’t ask is whether Google can establish a stranglehold on web software that’s as powerful as Microsoft’s was in desktop computing. In online advertising, Google has a huge market and logistical lead and will be very hard to displace. But unlike Microsoft, Google so far has not been very effective at leveraging that near-monopoly to take over other related businesses. At this time, it looks more likely that we’ll end up with a constellation of winners in different parts of the web applications world. Google is one, Amazon’s AWS is probably another, and more are to come.

Sincerely,
Rubi