• Open source
• Targeted to appear in netbooks in the second half of 2010
• Google Chrome browser + new windowing system + Linux kernel
• Minimal user interface
• Data stored or at least backed up in the cloud, and hence available on any computer
• Hardware compatibility hassles allegedly eliminated
• Ditto for software update hassles
• Ditto for security problems
• Apps apparently assumed to run inside the browser. (Not clear if this is required or just recommended.)

Obviously, Google Chrome OS is a direct attack on Microsoft — even more so than Google Wave, which I’ve predicted will “play merry hell with Microsoft Outlook, Microsoft Word, Microsoft Exchange, Microsoft SharePoint, and more,” or for that matter than Google Mail and the rest of Google Apps. Taken together, Google’s initiatives suggest that an all-out Google-Microsoft war is coming, in a conflict that many people have been expecting — and analyzing — for years.

So how will this all shake out? Well, let’s start with some basic points:

• Google Chrome OS Release 1 is expected over a year from now, and then only on a limited subset of PCs, namely netbooks.
• Google Chrome OS Release 1 is supposed to have great performance and be bullet-proof. Hmm …
• Google is evidently assuming that the apps people want to run will either be browser-based, or else be new ones written for Chrome OS. Hmm …
• Google is signaling that Chrome OS will be very limited in features. That makes sense for Release 1 — but what will be missing?
• Consumers have proven their willingness to buy non-Microsoft computers, especially Apple ones, specifically in the Mac and iPhone/iTouch product lines.
• A lot of people would have compatibility issues replacing Microsoft Excel or PowerPoint with partially-compatible alternatives. I’m not so sure about Microsoft Word, however. Other than those three, Outlook, and the Windows family itself, I’m not aware of any Microsoft client products that have much lock-in. (Well, maybe Xbox, but that’s not in the main stack.)
• Open source software often gets most of its community support in a couple of areas, namely compatibilities and language translation. Google probably doesn’t need the help in languages, but letting other people fix Chrome OS compatibility issues whose importance it didn’t recognize is potentially valuable.
• Google probably won’t make any direct revenue from Chrome OS. So how much will it invest in the project?
• Notwithstanding Danny Sullivan’s concern, there isn’t much of an antitrust issue here. Google’s search can’t easily be used to favor Chrome, Chrome OS, or Google Apps. And the other way around — e.g., using Chrome OS to favor search — Google clearly isn’t a monopolist.

So while Google may kill Microsoft’s client business some day, it clearly won’t happen for quite a while, Techcrunch’s excitement notwithstanding. We’re talking a multi-year effort before there’s any realistic chance of Microsoft being toppled. On the other hand, it’s hard to think of major software compatibility issues that won’t quickly be addressed, except Microsoft’s own product and, probably, MMO games — assuming, of course, Chrome OS gets enough initial traction for anybody to care. So intermediate- and long-term, Microsoft’s PC business is very vulnerable indeed.

The bulk of Google’s announcement follows (emphasis added):

Google Chrome OS is an open source, lightweight operating system that will initially be targeted at netbooks. Later this year we will open-source its code, and netbooks running Google Chrome OS will be available for consumers in the second half of 2010. Because we’re already talking to partners about the project, and we’ll soon be working with the open source community, we wanted to share our vision now so everyone understands what we are trying to achieve.

Speed, simplicity and security are the key aspects of Google Chrome OS. We’re designing the OS to be fast and lightweight, to start up and get you onto the web in a few seconds. The user interface is minimal to stay out of your way, and most of the user experience takes place on the web. And as we did for the Google Chrome browser, we are going back to the basics and completely redesigning the underlying security architecture of the OS so that users don’t have to deal with viruses, malware and security updates. It should just work.

Google Chrome OS will run on both x86 as well as ARM chips and we are working with multiple OEMs to bring a number of netbooks to market next year. The software architecture is simple — Google Chrome running within a new windowing system on top of a Linux kernel. For application developers, the web is the platform. All web-based applications will automatically work and new applications can be written using your favorite web technologies. And of course, these apps will run not only on Google Chrome OS, but on any standards-based browser on Windows, Mac and Linux thereby giving developers the largest user base of any platform.

Google Chrome OS is a new project, separate from Android. Android was designed from the beginning to work across a variety of devices from phones to set-top boxes to netbooks. Google Chrome OS is being created for people who spend most of their time on the web, and is being designed to power computers ranging from small netbooks to full-size desktop systems. While there are areas where Google Chrome OS and Android overlap, we believe choice will drive innovation for the benefit of everyone, including Google.

We hear a lot from our users and their message is clear — computers need to get better. People want to get to their email instantly, without wasting time waiting for their computers to boot and browsers to start up. They want their computers to always run as fast as when they first bought them. They want their data to be accessible to them wherever they are and not have to worry about losing their computer or forgetting to back up files. Even more importantly, they don’t want to spend hours configuring their computers to work with every new piece of hardware, or have to worry about constant software updates. And any time our users have a better computing experience, Google benefits as well by having happier users who are more likely to spend time on the Internet.

We have a lot of work to do, and we’re definitely going to need a lot of help from the open source community to accomplish this vision. We’re excited for what’s to come and we hope you are too. Stay tuned for more updates in the fall and have a great summer.

• Offers the possibility to improve upon a broad range of communication, collaboration, and/or text-based product categories, such as:
  • Search
  • Word processing
  • E-mail
  • Instant messaging
  • Microblogging
  • Blogging
  • Mini-portals (Facebook-style)
  • Mini-portals (Sharepoint-style)
• In particular, allows these applications to be both much more integrated and interactive than they now are.
• Will have open developer APIs.
• WIll be open-sourced.

If this all works out, Google Wave could play merry hell with Microsoft Outlook, Microsoft Word, Microsoft Exchange, Microsoft SharePoint, and more.

I suspect it will.

And by the way, there’s a cool “natural language” angle as well.

For starters, here are some basic links:

• Google has naturally set up a home page for the Google Wave project.
• Featured on that page but also separately available is an 80-minute video introducing Google Wave.
• Techcrunch has two highly detailed posts on Google Wave, one summarizing what’s in the main Google Wave video and one reporting on a Google Wave Q&A.

Here are some reasons I think Google Wave could actually live up to its promise:

• The email problem Google Wave purports to solve is real and critical. The email paradigm assumes linear conversations, and what actually happens is that they branch. Google Wave’s message-board-like paradigm is simply better, and more flexible (e.g., not limited to a single enterprise!) than Microsoft Exchange or Lotus Notes.
• The instant messaging problems Google Wave purports to solve are also major. Instant messaging is slow, tedious, disjointed, and ephemeral. Fully integrating IM with email solves most of those problems. And Google Wave’s UI interactivity solves most of the rest.
• Twitter needs to be integrated with other forms of communication. What’s more, Twitter’s functionality needs to be drastically extended. Google Wave is the best hope I know of to meet those needs.  Enterprise Twitter is just a special case of that.
• Workgroups (enterprise or otherwise) need light-weight mini-portals that can be created on the fly by non-technical users, to ease collaboration. Microsoft SharePoint, SAP Rooms, et al. don’t really meet that need.  Google Wave could.
• In particular, collaboration on documents, presentations and so on needs to be more cloud-based and generally easier than is the case in Microsoft Office. Google Wave has the potential to provide that.
• Google + open source is a potentially potent combination, especially versus Microsoft.

One note: Google of course needs to improve the reliability and customer service of its cloud-based offerings to make a huge dent in Microsoft’s market. But even with its flaws Google has already been a good alternative for a while.

As for the “natural language” angle: At the 44:30 mark of the main Google Wave video is a demo of some cool, very grammar-sensitive spell-checking technology. Google’s spell-checking technology is further discussed in a separate, short video.  The basic idea is that Google uses its vast library of web pages — and email and chat? — not just to model intended word usage but also kinds of mis-spelling behavior as well.

David’s thoughts as to why the SaaS share isn’t even higher – as it seems to be for Clarabridge* – centered on the point that some customers want to blend internal and external data, and may not want to ship the internal part out to a SaaS provider. Besides, if it’s tabular data, I suspect Attensity isn’t the right place to ship it anyway.

*Speaking of Clarabridge, CEO Sid Banerjee recently posted a thoughtful company update in this comment thread.

When I challenged him on ease of use, David said that Attensity is readying a Microstrategy-based offering, which is obviously meant to compete with Clarabridge and any of its perceived advantages head-on.

Lexalytics’ main business is OEMing sentiment extraction, e.g. to the many blog-analysis/reputation-management (i.e., Voice of the Market) companies that recently started up and in some cases have been bought by big market analysis firms. Lexalytics can and sometimes does extract the more basic stuff as well, but sentiment analysis is the heart of its business. A partial customer list can be found on the Lexalytics site. Lexalytics extracts in the English language only.

One feature Lexalytics is proud of is that it doesn’t just assess sentiment from a phrase; it also gives a confidence (”evidence”) weighting. In such a fuzzy area as sentiment, I think that’s a good idea.

Lexalytics has a demo site, PoliticalTrends.info. The links on the left show some of the charts and reports they offer. But the bar charts in the middle inadvertently show the limitations of an approach that overweights some kinds of linguistic analysis at the expense of others. As I write this, the top 5 “Breaking themes in the last 3 days” are

• last week
• court decision
• web site
• nuclear program
• front page

I think that particular part of the app might work better if a little more restriction were placed on what is or isn’t counted as a “theme.”

• Voice of the Customer/Voice of the Market (Attensity pretty much conflates the two) applications are going really well. David kept repeating that prospects were actually calling Attensity, rather than Attensity having to go out on sales calls and find them. (Of course, that’s what’s supposed to happen when you have good marketing, including but not limited to lead generation.) Phil said that the quarter is going extremely well, including with some big-name customers.
• Attensity’s new favorite buzzword for these applications is “First-person intelligence.”
• About 50% of Attensity’s commercial customers take the technology on a SaaS basis, including some of the biggest ones. I didn’t know that, but thought I’d ask after discovering how important SaaS is to Clarabridge. While Attensity apparently introduced a “new” SaaS offering earlier this year, in fact some of Attensity’s largest customers have always been on SaaS.  Edit:  Actually, that 50% figure is overstated.
• Clarabridge is Attensity’s only significant commercial competitor, at least to the extent David or Phil is aware.
• Government is a strong market for Attensity too. (Recall that Attensity was funded by In-Q-Tel.)
• In particular, Attensity has expanded from intelligence to civilian law enforcement, via something called LEADS (Law Enforcement Analysis Desktop Solution). LEADS extracts relationship information from case notes and the like and dumps it into the I2 link analysis tool (OEMed). I’m aware of only one actual LEADS customer (Chesterfield County, VA). But Attensity is talking with other jurisdictions, plus (an obvious group of prospects) “fusion centers” that combine case information across jurisdictions.

• Clarabridge’s favorite buzzphrase is Customer Experience Management (CEM). That’s how they define their category.
• Clarabridge’s second-favorite buzzphrase is Voice of the Customer.
• Clarabridge is active in a variety of all vertical markets, with the common characteristic being the overall richness of customer interaction (based on some combination of frequency and complexity).
  • Travel/lodging/hospitality continues to be important.
  • Retail has come on strong the past 2-3 quarters.
  • The telecom and internet sectors are going well; neither was big a year ago.
  • High-tech consumer electronics is an active sector.
• Much of the value users derive from Clarabridge is early warning, such as of trends in customer sentiment or loyalty.
• Sometimes, this warning can be same-day, for example of technical malfunctions. Sid told one story of a hotel that was wrongly locking guests of its rooms, and another of a website that didn’t live up at ordering time to the offer it had just promoted. In both cases, the problem was detected and fixed immediately. Sid believes this wouldn’t have happened without Clarabridge technology.
• Examples of applications and benefits not closely tied to early warning include:
  • Scorecarding/benchmarking – all doubts about legitimate statistical significance notwithstanding, some enterprises are including text mining results in their self-measurement.
  • Correlation of trends to specific events – text mining can help figure out whether a specific marketing campaign or seasonal variation is getting results. For example, if you run a marketing campaign calling people’s attention to a specific product feature, and your support calls in connection with that feature spike, chances are that the campaign is working.
• Sid cited one example of a household-name Clarabridge customer using more open-ended survey forms than before. Good idea. Lots more enterprises should follow suit.

• SaaS represents over half of Clarabridge’s revenue. Please note that this surely means well over half of Clarabridge’s new sales are in SaaS, because of how revenue is recognized. And these fractions are still growing.

• Clarabridge is making 10-15 sales transactions/quarter.

• Clarabridge reports 500%+ sales and revenue growth in 2007. (Note that Clarabridge was only recently founded and spun out of Claraview, unlike a number of competitors.)

• Over half of Clarabridge’s customers are already on SaaS. Given the other figures already cited, that’s unsurprising.

• Clarabridge is selling to business departments, in customer-oriented areas (marketing, support, product management, etc.). IT hasn’t embraced text mining technology yet.

• A large customer may get up to 1-3 terabytes of content into Clarabridge over the course of a year. (Obviously, the sample size here is small.)

• Clarabridge says that customers quickly expand their usage to multiple corpuses of data, and multiple business departments. (But then, I’m trying to think of an analytic technology vendor who doesn’t say that, and I’m drawing a blank.)

• In particular, Clarabridge thinks it’s important that its customers can and do fuse internal and external text data. Internal text might be email, survey forms, or call center verbatims. External text might be blog or forum postings.

• Clarabridge has developed a Web services API to bring data back to customer sites, for integration with other data — but few customers care yet. Mainly, they’re operating on a pure outsourced basis.

I’ll post about Clarabridge’s actual applications and customer segments separately.

The most interesting point was text mining SaaS (Software as a Service). When Clarabridge first put out its “We offer SaaS now!” announcement, I yawned. But Sid tells me that about half of Clarabridge’s deals now are actually SaaS. The way the SaaS technology works is pretty simple. The customer gathers together text into a staging database – typically daily or weekly – and it gets sucked into a Clarabridge-managed Clarabridge installation in some high-end SaaS data center. If there’s a desire to join the results of the text analysis with some tabular data from the client’s data warehouse, the needed columns get sent over as well. And then Clarabridge does its thing.

It has always been the case that business intelligence was an IT systems software technology that often wound up being sold on an application basis to end-user departments. Clarabridge very much fits that model. And while it used to be the case that BI adoption was pretty simple, that’s increasingly not the case, which is one reason SaaS is appealing. So this all makes a lot of sense.

Even so, I was surprised to hear that SaaS had so quickly become half of Clarabridge’s business. Wow.

Since Clarabridge touts Cognos as an important partner, and Cognos is being bought by IBM, I also asked Sid about UIMA. He basically responded that UIMA was unlikely to become relevant to Clarabridge any time soon, because the way Clarabridge interfaces with other software is SQL. Up to a point, that makes great sense to me. But if we buy into the comprehensive/exhaustive extraction story — as Clarabridge does — then the day should and will come when serious linguistic processing gets done on text after it is extracted into a relational database. And if that happens, then all of a sudden SQL won’t be the only interface integrating text analytics with BI.

*Note: Umbria has a non-obvious URL.

I haven’t actually spoken with Umbria — uh, guys, why not? — but they seem to have a reputation tracking service. Their niche is apparently to quantify/measure by a variety of metrics, and that’s supposedly what makes their service (and their competitors’) worthwhile.

I certainly believe that automated clustering of web commentary is worthwhile for many companies, even if with no more precision than via some kind of tag-cloud visualization. (And I’ve been skeptical of tag clouds and the like ever since I was first pitched by Semio.) But I’m curious as to whether there’s sufficient and sufficiently precise data to deliver real value along the lines of what Umbria offers.

That there’s enough for at least a superficial demo I have no doubt. Dashboards look great when there are maps involved, and I imagine Umbria’s offering is full of map. Not to mention pie charts, bar charts, layer cake graphs, and all that other good stuff …

So what do you think, folks? How finely can one slice the reputation tracking salami with today’s technology and data, before things just get silly?