Google Chrome's Latest Vapor Victim Is Intel

Google Chrome's disruptive potential is being felt across the high-tech industry and the latest company that analysts feel could be threatened by the proposed Chrome operating system is microprocessor powerhouse Intel. That could be a long way off, but at least now Microsoft can welcome its old Wintel comrade-in-arms to the ranks of hypothetical Google victims.

Intel executives on Thursday were fielding Google Chrome questions as far afield as Taipei, Taiwan, where a director of the chip giant's Ultra Mobility Group batted back the notion that Chrome would threaten Intel's own early-stage OS for smartphones, mobile Internet devices (MIDs) and netbooks, the Linux-based Moblin.

"Our long-term goal is providing hardware for devices with different operating systems ... more competition will drive up more innovations and that's good for consumers," Intel's Michael Chen told Dow Jones in Taipei to kick off a busy day of Google Chrome talk for the Santa Clara, Calif.-based chip maker.

Closer to home, analysts seemed more interested in how Mountain View, Calif.-based Google might bite into Intel's core hardware business rather than the possibility that Chrome could nip a nascent software offering in the bud.

James Mitchell of Goldman Sachs got the ball rolling with the contention that Google Chrome could boost the fortunes of ARM manufacturers at the expense of x86 chip makers like Intel, reasoning that all ARM platforms lack is a compatible set of applications to rival Microsoft's Office suite:

"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...," Mitchell said. "[O]ur 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."

Intel, unsurprisingly, begs to differ. Since launching its low-power Atom processor for netbooks and MIDs, the company has maintained that the key to its architecture's appeal in an increasingly mobile world is that x86 chips deliver the Internet better than the alternatives. Over the past year or so, that talking point has never been far from the lips of Intel executives, from CEO Paul Otellini on down, even as competitors like Nvidia's Jen-Hsun Huang have openly mocked the notion that only Intel can give consumers the Web.

More specifically, an Intel spokesperson contacted by Channelweb.com dismissed the idea that Google Chrome was a problem for Intel's proposed entry into the handset and smartphone markets with new research partners Nokia and LG Electronics. Intel was busy working with Google to optimize its hardware for Chrome and looked forward to delivering Intel architecture-based platforms for Chrome-enabled devices, the spokesperson said.

And Intel may have time on its side to do just that, said a second analyst, Enderle Group principal Rob Enderle.

"The [Chrome] platform is moving up initially very strongly on ARM. But Intel is positioning Atom as it pushes down into a market opportunity with smaller devices and my take is that their strongest Atom part will be ready for the entry of Chrome," he told Channelweb.com, adding that the ARM manufacturers' pricing gap over Intel could also be closing soon.

Still, Enderle agreed with his Goldman colleague about Chrome's potential benefits for the ARM vendors, saying it "clearly" would give the chip architecture "more stature for sure."

But where the analyst has doubts is whether Google can hold on to whatever market it potentially creates with Chrome. Based on the dynamics of the current smartphone industry, Enderle said he suspected that a new "smartbook" market developed by Google with Chrome would eventually favor vendors with their own hardware and established relationships with the carriers, such as Apple, Palm or Research in Motion.

"Once Google establishes this market, I wonder whether Apple is going to step in and take it," he said. "Will Google create this market and not be able to hold on to it?"