Google: Apple's Best Friend

Maybe it's the two cups of coffee I've already had. Or that the Consumer Electronics Show, now under way in Vegas, is generally considered tech's most interesting rumor mill. Regardless of the reasons, a story in this morning's edition of The Wall Street Journal has me wondering if Google (Nasdaq: GOOG  ) has inadvertently become Apple's (Nasdaq: AAPL  ) best friend in the computer industry.

Let me explain. Rumors have been flying over the past week that Google will:

A. Develop a low-cost personal computer available through Wal-Mart (NYSE: WMT  ) .

B. Introduce a $200 thin-client computer developed in conjunction with privately held Wyse Technology.

C. Open a llama farm in the Himalayas.

Well, OK, the last one isn't really on the list -- as cool as it might be to own a llama farm. The real dish is that Google aims to free users from Microsoft's (Nasdaq: MSFT  ) death grip on the desktop.

And that's where the Journal story comes in. It reports that Google co-founder Larry Page will use his Friday keynote at CES to roll out a Google-powered online video store, and debut a bundle of downloadable software called Google Pack.

The video store idea is interesting, to be sure. But pretty much everyone wants a piece of that massive market. More interesting to me is the Google Pack. It will include all sorts of popular software, such as Symantec's (Nasdaq: SYMC  ) antivirus tools, RealNetworks' (Nasdaq: RNWK  ) RealPlayer, and of course, Google's own toolbars and desktop search utilities. The idea, it seems, is to provide a "get started" kit for your PC that will make it harder for Mr. Softy to push the search king and its advertising juggernaut off the Windows platform.

I've no idea whether it will work. Fortunately, the only thing that matters here is that Google is concerned about the possibility. Think about it. The battle between Microsoft and Google revolves around who owns the interface to you and your online habits. Whoever controls that pipe could control tens or even hundreds of billions in ad dollars. Google, however, can't operate without a PC interface, which makes Microsoft a -- pardon the expression -- necessary evil.

Removing that roadblock is key to Google's growth. That's why buyingTiVo (Nasdaq: TIVO  ) still makes so much sense. Or, for that matter, creating a Web-driven, Windows-free computer. Either way, the PC experience is likely to get a lot more fragmented than it used to be. You'll have the Google way, or the Microsoft way. You pick the software and services you want, and then integrate them on your own. And, yes, before you ask, that will create extra work; work that PC users haven't been subject to for years -- and which Mac users haven't been subject to for, well, ever.

That's why a full-scale desktop war between Microsoft and Google could send hordes of hooked iPodsters fleeing to the Mac. Seem unlikely? Sure, today. But what about in two years? How about five? Ten?

So, go ahead, call me loopy. High on caffeine. Flat-out cracked. Or just plain wrong. But Larry Page and Sergey Brin, Google's co-founders, famously wrote in the company's IPO prospectus that they might make investments that seem "very speculative or even strange." That's exactly the kind of environment where logical extremes are born. Like, you know, a Window-less, Web-driven, Google PC.

Now would be a good time to send the flowers and candy, Steve.

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Fool contributorTim Beyersthinks a Google PC would be interesting, but not nearly as much as a new Mactel PowerBook. How about it, Steve? Tim didn't own shares in any of the companies mentioned in this story at the time of publication. You can find out what's in his portfolio by checking Tim's Foolprofile. Microsoft is aMotley Fool Inside Valuepick. TiVo is aMotley Fool Stock Advisorpick. The Motley Fool has an ironcladdisclosure policy.


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