Excerpt from:  Tech M&A Talk
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September 05, 2008

Google Enters The Browser Wars

Is Chrome The New IE Killer?

by Don More and Francesca Bartolomey

On Tuesday Google launched the latest effort in its battle for supremacy against Microsoft in all things Internet – the Google Chrome browser. Chrome has cool features such as sandboxing (allows tabs to run independently of each other – a crash in one doesn’t bring the whole browser down), a task manager that shows what sites are memory hogs (and lets you kill a tab without killing the entire browser), and a private mode called Incognito that prevents browsing activity from being recorded. More broadly, Chrome’s open source roots and design are meant to make it a better web application platform than Internet Explorer (IE).

Google and Microsoft have been going at it for some time now – search, email, office productivity applications, and now the browser. What’s next in Google’s arsenal?  Signs point to full-out war on Microsoft’s chief money-makers – Windows and Office. It’s no secret that Google’s ambitions extend to full-scale computing in the cloud, and Chrome is a key step as it provides an on-ramp to web application services. One small example of this is that Chrome lets users drag a tab containing a web application, such as Gmail, to the desktop where it looks just like a regular application – the browser’s tabs, buttons, address bar, and menus all disappear. While Microsoft’s franchises are not immediately threatened, Google’s combination of a web-based operating system, SaaS apps, and the market-leading search engine will present a growing threat.

So what does Chrome mean for the Internet browser market?  Currently, it consists of three primary players, but is dominated by Microsoft (see figure below). Some journalists and bloggers tout Chrome as the IE killer, but it could be that Firefox has more to worry about. Google and Mozilla (maker of the super-awesome Firefox browser) have historically had a collegial relationship.  Google’s foray into the browser space, however, looks as though it will result in, if not quite a direct hit on Firefox, at least collateral damage. Both browsers leverage open source and both appeal to the same demographic – the young and tech savvy. Microsoft, with 72% market share, has less to worry about; at this point if users haven’t migrated off IE to Firefox, it will probably take something seismic to get them to move – especially since IE 8 launched in beta last week with new cool features (private browsing, Web Slices,  and visual search,  to name a few). In addition, some are already highlighting security vulnerabilities that Chrome may introduce. Maybe Chrome is a good enough browser to lure the IE-faithful away, and will open up a new front against Windows and Office, but only time will tell.

Browser Market Share


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