Google's Chrome OS: The dirty little secret about those new devices

By JR Raphael (@jr_raphael)

Google Chrome OS Chromebooks

My first thought when I saw Google's new Chromebooks was "wow": We're finally seeing the hardware horsepower and software improvements Chrome OS needs to succeed.

My second thought was "damn": They still aren't getting the pricing right.

Initial appearances aren't everything, though. It turns out there's a whole other layer to Google's Chrome OS reboot, and it's where the company's real strategy likely lies.

Google, if you haven't heard, just unveiled a new series of second-gen notebooks that runs its cloud-centric Chrome OS operating system. There's the Samsung Chromebook Series 5 550 3G model, which costs $550, and the Samsung Chromebook Series 5 550 Wi-Fi model, which runs $449.

Google Chrome OS

I've been watching Google's Chrome OS since its limited launch at the end of 2010 (remember the Cr-48, anyone?). It's hard to emphasize how far Chrome OS has come since that inauspicious debut: Chrome OS has transformed from a shaky and somewhat limited setup into a full-fledged operating system that's actually quite nice to use -- provided, of course, you're comfortable living online and using cloud-based applications.

Still, for most shoppers, $450 to $550 is a lot to ask for the type of experience Chrome OS provides -- especially when you consider the variety of full-fledged Windows 7 notebooks and high-end tablets you can find for the same price. As I concluded when the first Chromebooks came out, the pricing model is Google's Achilles' heel with these systems; if they'd make the devices 200 bucks instead of $500, the Chrome OS concept could really take off.

Here's the dirty little secret, though: Google isn't going after the individual consumer with its Chrome OS Chromebooks. Not at those prices. Sure, the G-Team will be delighted when an average consumer decides to pick up its product -- and for some of us, the value will be worth the cost -- but the true target here is almost certainly the world of business and education.

While the $450 to $550 cost may seem steep from a consumer perspective, for businesses and schools, the Chromebook is part of a bigger package. Full support -- both hardware warranty and 24-hour phone service --

Samsung Chromebook Series 5 550

and enterprise management tools are available for $150 per device for businesses and $30 apiece for schools. That's an eye-catching proposition: thirty dollars per system, with practically no training required and no need to worry about virus protection or labor-intensive software updates (Chrome's cloud-based setup is inherently safe from viruses, and OS updates are pushed quietly through the cloud with no need for user or admin intervention). 

It's a big change from the pricing model Google offered with Chrome OS in the past: The first generation of Chromebooks came with monthly fees for business and school accounts -- $28 a month per device for businesses and $20 a month for schools. With the new plan, organizations pay only the single flat fee for the lifetime of each device. 

Consider, too, the fact that Google's enterprise division just rolled out an optional hosted virtualization solution for Chrome OS account holders. That means business and education users can now gain access to services from nGenx that allow full execution of desktop apps through the Web, essentially addressing the most obvious enterprise-level objection to Chrome OS adoption. Google isn't publicizing the price of the service but says it comes "at a fraction of the price of current virtualization offerings."

(Google's Chrome Remote Desktop beta app, meanwhile, allows individual user-based remote access to any Chrome-connected PC at no extra cost.)

Android Power Twitter

Google has talked about its desire to bring Chrome OS into businesses and schools before. With its new pricing structure, the company's ultimate goal is becoming crystal clear. For Chromebooks, the price is right -- it just isn't about the average consumer.

SEE ALSO: The Chrome OS experiment: 2 weeks with Google's new Chrome computers 

JR Raphael writes about smartphones and other tasty technology. You can find him on Google+, Twitter, or Facebook.

Article copyright 2012 JR Raphael. All rights reserved.

Copyright © 2012 IDG Communications, Inc.

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