After introducing the Chrome browser and the Android mobile phone operating system, Google has announced it is next offering an operating system for general-purpose computing. Known as Chrome, the OS presumably leverages the APIs developed for browsers to run applications that leave users unconcerned what processing is done locally and what processing is done in the cloud.
My take: Google, by offering a whole productivity suite out of the box, can take share from the budget computer market as soon as it shows the thing works. The part of the computer shopping spectrum that includes Linux pre-installation will likely be a starting point for ChromeOS, but if the thing is reviewed as effective for general-purpose use by non-Unix geeks, the probability is that Google's cost-free OS will become a widely-available pre-install (for the benefit of commodity box makers' margins). This doesn't mean Google will steal MSFT's OS cash cow -- far from it. Google is as unlikely to sell OS licenses as it is unlikely to sell browser licenses.
Rather, it means that MSFT's cash cow stands in the crosshairs of a fee-for-service company that hasn't needed to sell a line of compiled code in its history -- and that's interesting in its own right.
UPDATE: CNN offers a look at the issue, and seems to agree the cloud and Google's general-purpose OS are an entry into Microsoft's turf, and not just a gimmick for folks who tinkered with desktop Linux.