Dell testing preinstalled Google software package
SAN FRANCISCO (Reuters) - Dell Inc. and Google Inc. confirmed on Tuesday they are testing a pre-installed package of Google software on Dell computers, in a potential blow to Microsoft Corp.'s dominance of desktop software.
Context & Ripple Effects
The confirmed test follows unconfirmed reports of a billion-dollar Dell arrangement that coincided with a $17 drop in Google shares. It moves the Dell-Google relationship from deal speculation to a defined product-distribution experiment.
A contemporaneous prediction of a Google-powered office suite on Dell framed the wider strategic question: whether an OEM preload could extend Google's presence beyond the browser and search page into the desktop's initial setup.
First-order effects
- Dell gives Google a factory-installed distribution channel for its software package, while Microsoft faces a challenge to its influence over what users encounter when a new PC is configured.
- Google and Dell can test whether OEM placement drives adoption more effectively than asking users to find and install Google software themselves.
Second-order effects
- The PC setup screen becomes a direct competitive battleground between Google and Microsoft, making Dell's software-selection decisions more consequential than a conventional download partnership.
- Microsoft must defend its desktop position not only through its own software bundle but also through the value it offers hardware partners such as Dell.
Third-order effects
- If OEM preloads spread beyond this test, control of the new-PC experience would shift toward negotiated distribution partnerships rather than being determined chiefly by the operating system's default software environment.
The trend: PC makers are becoming strategic distribution partners for internet companies seeking a place on the desktop before users choose their own software.