Google’s Browser, a Realistic Perspective

September 3, 2008, Editor Picks, Tech Investing, Tech Solutions, Web Browsers, Web Programming — @ 2:08 am

From the blogesphere to the traditional news media everyone seems ecstatic about Google’s new browser, Chrome. Some are even proclaiming that it will overtake Windows and be the next major operating system. When so many smart people fall over themselves to hype a product still in development I tend to try to view things from the other side. For the Chrome browser there are a lot of important questions that no one seems to be asking. Like what special capabilities is Google bringing to the crowded browser market?

Open Standards

Everyone is proclaiming how great this will be that we will have an open source browser. The thing is, there is already a great open source browser; Mozilla’s Firefox. It is debatable how much is gained from open sourcing the browser’s code. What is important is, how will this browser support open standards? Since so many websites were not initially implemented to fully support the W3C Standards (the international organization that defines the internet’s standards) will Chrome be able to correctly render 99% of websites, as claimed, while also fully supporting open standards?

Innovator’s Dilemma

Balancing support for innovation and new standards with support for legacy applications and standards is a monumental task that should not be taken lightly. Legacy support is what gives Microsoft Windows its monopoly, but it also acts as a yoke on innovation. Microsoft has a better operating system than Vista; they just cannot figure out how to roll it out.

Microsoft’s Internet Explorer is in a similar boat. It has been estimated that over 50% of IE’s code base is error handling and “seamless” handling of poorly written website code. This code was very useful in the late 1990s and early 2000s when nascent programmers were still figuring out how to write relatively static web applications. Now that web applications are much more dynamic this code bloat is a performance drag affecting many of the more complex Web 2.0 style applications.

In a classical example of an innovator’s dilemma Microsoft invented the key technology behind Web 2.0 applications, but IE is still a laggard due to the legacy yolk. A key factor of Firefox’s success, and its dramatically better performance, is they took the time to clean up their legacy code base. IE 8 is making steps towards better support for W3C Standards and better
performance while supporting a migration path for enterprises. In many respects following how Microsoft balances these objectives is more important than following Chrome’s progress. Although I imagine the press will instead follow Chrome’s progress.

Where is the Innovation

What new, innovative features does this Google browser have? So far it appears they have just implemented functionality currently in the existing browsers. As for new functionality like video we already have platforms like Flash and Silverlight that are pretty good and improving.

Mozilla’s recently released Firefox 3.0 has a much better optimized JavaScript engine and IE 8 will as well. So far Chrome’s JavaScript engine appears to only be 13% faster than Firefox 3.0. Users do not notice 13% improvements. When Chrome goes live it will probably also be competing with IE 8.0 and IE 8’s performance improvement.

Overtaking Microsoft

Internet Explorer (IE) is a relatively crappy browser that has easily over 50% market share. As some claim, this isn’t solely because most people can assume a user has IE. It is because many websites still work better in IE; and many, probably most, of these websites are inside firewalls. Applications built for only a few hundred users or less.

The key to overtaking Microsoft’s browser isn’t to build a cooler browser. Apple, Mozilla, and Opera have done that. The key to overtaking IE is to making a compelling ROI argument to enterprises to abandon IE for a different primary browser.

Enterprise Strategy

Unless Apple makes a big push into the enterprise or Red Hat consolidates the many Linux splinters Microsoft’s desktop dominance will probably last another decade; even with corporations not upgrading to Vista. On a side note it would be interesting if Apple purchased Sun, spun-off its hardware business (while it still has some value), and made a big push into the enterprise. Thin clients offer an alternative, but Windows and its partner Citrix are currently positioned relatively well. However, that is for another article. So for now browser makers are still playing in Microsoft’s playground.

For the majority of websites it is not cost effective to build and test the website in multiple browsers. Project teams focus on one or two core browsers and make a best effort for the others. This is especially true for corporations building websites only intended for a limited number of users. As a result many corporations choose the browser with

  • The largest market share.
  • The one they have built applications on for years.
  • The one they know how best to manage. For support reasons companies need to manage how and when core software upgrades are presented to users.

Active Directory

At any large or mid-size company any internal website can know who you are (and probably does) if you are using Internet Explorer because of its tight integration with Active Directory. This allows easy implementation for single sign-on across company or even inter-companies’ web applications. To gain critical enterprise adoption the existing browsers need better support for Active Directory and how to manage it.

Offensive or Defensive

Few people have mentioned that Chrome may actually be a defensive move by Google to protect their search engine turf. I regularly use iGoogle and Google Maps, but I haven’t actually gone to Google.com to perform a search in at least a year. I perform all my searching in the browser. Of course, I primarily use Google, but I find myself using other website’s like Wikipedia, Ask, and Dictionary.com more often; and my switching costs are basically nil. In fact, I’ve even started using Live Maps because of its far better international support (Live vs. Google).

Five years ago I remember wondering why someone would use a search engine other than Google because it was at least twice as good as competitors. While completely subjective I think Google is now only marginally better. I have a dozen search engines configured in my browsers and I’m always one click away from not using Google. Now I wonder why people are so reliant on Google. It is getting easier to use other search engines and Google is growing up and becoming a little
closer to being evil.

Laissez-Faire Mess

Google is well renowned for encouraging engineers to spend 20% of their time pursuing individual projects. This has created a great environment where ideas bubble up. However, some initiatives require top down strategy. Creating a browser platform serving a multi-sided market is such an initiative.

Fortune called Google’s management style a “laissez-faire mess“. The questionable strategy and rollout of the Google browser may validate that endorsement. In fact, one could go so far as to say that Google’s laissez-faire strategy resembles one of its competitor’s peanut butter strategy.

Google still has yet to prove that massive hiring into a laissez-faire environment can fuel innovation. In fact Apple, perhaps the most innovative company this decade, takes the opposite approach by keeping its core design teams small and focused. I am still questioning the special capabilities of Google’s Android and now we have Chrome. For comparison, I can critique specific features of the iPhone, such as the battery (which Apple will eventually fix like they did with the iPod), but the special capabilities of the iPhone are crystal clear to any observer.

Current Market State

As an advantage of losing Browser World War I Mozilla was able to free itself of its legacy code and become the performance leader; just as Web 2.0 applications began taking off. Microsoft finally seems motivated to accelerate many legacy applications migration path allowing it to offer better support for standards and increased performance. Although it is apparent that IE 8.0’s performance will still trail Firefox 3. Safari will be relegated to the smaller yet growing Apple user base with little enterprise support. Opera is a good browser that doesn’t offer a compelling enough reason to switch (sounds similar to Google’s Chrome).

Currently Firefox has a real chance to become the number one browser in Europe, but its market share (and growing importance) may be hurt by the splintering browser market due to Safari and now Chrome.

So What Has Changed

I’ll download Chrome and test it out, but I’m not excited to build a new website and have to test it in an additional browser. That is the problem that Google has to address. Not just for the hundreds of thousands of websites on the internet, but especially for the hundreds of thousands of web sites not on the internet (at least not without a username and password).

If Chrome was built by someone other than Google we probably wouldn’t be hearing about it. I am excited that one day enterprises will be building websites on a browser much better than IE 7, but that will take a vendor who understands enterprises and has a relevant platform strategy. I haven’t heard such a strategy from Google. For the near future it is most likely that vendor will be Microsoft and now less likely to be Mozilla. I imagine the IE and Firefox teams will wake up tomorrow looking over their shoulder at each other not Chrome.

Chrome’s biggest impact may be a weakening of Google’s support of Firefox. Google has been the biggest sponsor for Firefox. If this support (technical or financial) diminishes due to Chrome than the biggest beneficiary of Chrome may indeed by Microsoft. Let’s hope not. The browser market needs a strong number two to compel the market leader to innovate. However, the internet will not benefit from a splintered browser market requiring programmers to support numerous browsers. Like any platform market, the browser market will trend toward a monopoly or duopoly market. Let’s hope it’s a duopoly.

So What Is Next

Maybe Google will announce tight integration for Chrome with Android or some amazing new Semantic Web style feature. However, I’ll bet the next major disruptive innovation in this area will come from Apple or one of the new companies created by ex-Googlers.

Disclaimer: I own no stock in Google, Microsoft, or Apple.

A Kink in Apple’s Armor?

June 22, 2008, Editor Picks, Tech Investing — @ 11:24 pm

A funny thing happened to me on the way to the Apple store. I picked up the latest copy of Information Week magazine and read an article about the HP Voodoo Envy 133. Long story short, I’m no longer going to the Apple store. I’m waiting for the Envy.

Vista Woes

After a painful year running Vista I want need a dependable lightweight laptop with amazing battery life. So I did the once unthinkable; considered getting a Mac. In the past two weeks I’ve visited the Apple store twice to checkout and ask some questions about the Mac Air. I would have bought it the second time, but it was the South Beach store and it seemed the price was a couple hundred dollars higher than in Dallas (no surprise there).

While many rave about the OS X, and I have no doubt it is better than Vista, corporate types like me simply need some applications that do not run on the Mac; and I want to avoid dual boot (granted VMware does have a better solution). However, since I could do 90% of my work on OS X I was willing to get a Mac as a second mobile laptop primarily due to the amazing battery life.

Apple’s Killer Products

Apple has re-built their business this decade on the back of its product designers. Their sleek integrated products simply blew away the competition. Their best two products the MacBook and iPod have driven astounding growth.

The iPhone looks like it may be a third category killer. Granted, Apple has some pretty powerful competitors to overcome like Nokia, Samsung, Sony, Motorola, and HTC. I don’t include RIMM because in a couple years battery life will reach a point where the last feature (RIM’s battery efficient devices) Blackberry dominates will be a non-issue. Since practically every other phone supports ActiveSync IT departments will finally be able to jettison the extra cost of maintaining a Blackberry server. Soon, when Apple releases its 3G / ActiveSync iPhone for $199 its sales should sky rocket. Although, how long can Apple maintain its lead in the cell phone market? Probably the most cut throat product market.

The iPod is still head and shoulders above the other MP3 players. In fact, I just bought my second iPod Nano a couple months ago. However, this market is leveling off as it is becoming more common to find people with even multiple MP3 players. The HDTV / LCD market is commoditizing like the original TV market did. You can see this at any Best Buy store or even at Dell’s Northpark mall store. This is making Apple’s nice sleek desktop models look comparatively less impressive. Especially when doing a side by side comparison at the Best Buy stores that conveniently now offer Apple computers.

Mac Attack

So back to the Mac; the heart of Apple. The MacBook is a solid product, but I just saw a Gateway laptop at Best Buy for less than $900 that included 4GB of memory and an Intel Core 2 Duo – undoubtedly very competitive with the Mac book. It is amazing how more power can make up for many of Vista’s issues. The Mac Air has been the wow product. While this year the Air has faced stiff competition from the Toshiba Portege R500 and the Lenovo ThinkPad X300 the HP Voodoo Envy 133 ups the bar compared to everything in the market right now.

It has features the Mac Air is clearly missing like a removable battery and more than one USB port, but the amazing part of the Envy 133 is its design. Its appearance is cool. It has a removable battery. It has a removable battery (repeated for emphasis). It is .7 inches thick. It’s sturdy due to its carbon fiber chassis. It has introduced a few new design elements that upon seeing them just appear to be common sense, such as putting the Ethernet port on the power connector. It has an HDMI port. It has instant access to Skype and an Internet browsing through the Voodoo IOS.

Rahul Sood may have bested a fragile Steve Jobs and made Voodoo HP’s Lamborghini. I don’t expect Apple to stumble any time soon. They still have a stranglehold on the MP3 player market; with no end in sight. They still are releasing a game changing iPhone while competitors aren’t innovating but instead copying Apple. Which Nokia appears to admit.

“I don’t know what is copy and what is original but if there is something good in the world we copy with pride.”

Windows Vista is finally getting to the stabilizing service pack time frame and despite prevailing wisdom the MacBook and OS X have not been completely without defects either. Windows Vista is still a very disappointing product that will be skipped by most enterprises. However, Apple doesn’t offer anything close to true enterprise client management software. If enterprises migrate from Windows they are more likely to embrace a Linux based
thin client than OS X. Now if Apple decides they want to move to the enterprise by purchasing Sun Microsystems things could get interesting. That doesn’t seem to be the direction Apple is pursuing.

Apple depends on being the best of breed consumer product. Something that HP Voodoo’s division might have something to say about, exposing some kinks in Apple’s business model…

Next Generation Semiconductor Design

, Editor Picks, Semiconductors, Tech Investing — @ 10:45 pm

I was pleased that Seeking Alpha published a summary of my paper on the Next Generation of Semiconductor Design and honored that they made it an Editors Pick. Over the past couple years I’ve find Seeking Alpha to easily be the best source for investment ideas. On my Seeking Alpha post I put a follow up comment that did not include some links so I thought I would re-post it here.

 

To help clarify, Xilinx and Altera have platforms that their clients develop products on top of and Xilinx and Altera make money by selling chips that go into these end products. While it is true that Microsoft needs to care about the layman’s needs, Xilinx and Altera only need to support engineers due to the nature of their products.

As for whether Xilinx or Altera is in a better position the simple answer would be Xilinx since they have a larger market share and currently appear to have more mindshare. Of course, things are rarely that simple. Altera has better margins and has made some great moves the last couple years such as: partnering with ARM, designing for power management, and having the best path to structured ASICs.

Both Xilinx and Altera have independently discussed that future growth is in adjacent markets not fighting a battle of attrition between each other; such is the benefit of a duopoly. It typically takes two years from design win to volume production and I don’t expect meaningful revenue growth in the PLD industry for about a year and a half. Right now I don’t see a major difference in design wins between the two companies, but that could change.

I think both companies are a great value at the current price and I intend, as best as I can, to track the design wins for these two firms. That will be the leading indicator of who will benefit from the next wave of end product innovation. For the foreseeable future the market can support two major PLD companies and the first losers will be those in adjacent markets.