Google Entering the Hardware Market

Rumors swirl.

Speculation is mounting that Page will use a keynote speech at the Consumer Electronics Show in Las Vegas on Friday to unveil details of a low-cost computer or internet-enabled device that will run on a new operating system developed by Google.

Because the device - similar in concept to the Mac Mini unveiled last year by Apple's Steve Jobs - doesn't use Microsoft's Windows, it could cost as little as $200.

The article questions how Google would make money off of the devices, suggesting the possibility that Google will serve ads. In my estimate, it won't. If this is true, my guess is that it would presently be about expanding the reach of gmail, Google Desktop, and Google Instant Messanger, keeping users loyal to Google Search, and getting its foot in the door as an Application Service Provider... for its own products and those of others.

In a sense, Google is already a massive Application Service Provider. Google's search engine, for example, runs on their computer, not yours. As does gmail. Much of the action behind their instant messaging service runs on their servers. Add, test, and perfect an office suite for the benefit of users of the new Google computer, run a decent browser on the cheap computer, and they'll save each buyer of their machine several hundred dollars in software costs while providing at least as much functionality (and knowing Google, quite possibly more) than they would get on a low-end Windows machine with Microsoft Works.

(I'm having a bit of trouble with the text, and it's been circulating for a few months... but this appears to be a set of screen shots of how a Google computer might appear in operation.)