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After three decades of bowing to Microsoft (MSFT.O) and its Windows juggernaut, PC and computing gadget makers are preparing for a new era that could offer the first real choice for the software that make their products tick.
The arrival of competition in the form of new operating systems from Google (GOOG.O) is set to benefit both gadget makers and consumers, reducing prices and giving users more choice.
Personal computer and smartphone firms showed off a range of smartphones running on Google's Android operating system, and detailed plans for PCs with Google's Chrome system at Computex, Asia's largest computing trade show, in Taipei last week.
They hope their product development dollars will be well spent on Google's largely untested systems.
"I see it as a battle, not a war," said Tudor Brown, president of British cellphone chipmaker ARM (ARM.L).
"The battle is for gaining share of people's imagination. It's driving innovation, which is very exciting."
Both Google and Microsoft were running full court PR blitzes at Computex, a show dominated by Taiwanese PC firms whose devices usually come pre-installed with operating systems.
The newer smartphone and tablet PC spaces could be the first to see true competition, as Google and Microsoft compete with rival products from Apple (AAPL.O), Nokia (NOK1V.HE) and others.
Competition in the PC space could take longer, as Google seeks to break a stranglehold long held by Windows.
Android was ranked just ahead of Windows Mobile in the first quarter of this year, with its number of users increasing more than eight-fold from a year ago, according to Gartner. By comparison, the number of users of Microsoft's Windows Mobile system remained largely flat at about 3.7 million users.
"I'm not sure we're going to have a clear winner like how Windows is dominating the PC world," said Lu Chialin, an analyst at Macquarie Securities, speaking of competition in smartphones.
"It's likely we're going to see three or four major players in the future instead of just one in PCs."
HEDGING BETS
With the new landscape still to take shape, technology firms are hedging their bets by offering Google- and Microsoft-based versions of many of their newest products.
While largely untested, Google's products offer more flexibility than Microsoft due to their open-source nature. Google's basic products are also free, unlike Microsoft's, and have the backing of the world's biggest Internet firm.
HTC (2498.TW), the world's No. 4 smartphone brand and the first to launch an Android smartphone in 2008, typifies the approach many companies are taking, carefully repeating its openness to both systems.
HTC's Chief Executive Peter Chou often says the company is totally committed to working with Microsoft, even as it offers eight Android smartphones and has developed a customized version of Android for its products.
Other players including LG (066570.KS) and Motorola (MOT.N) have taken a similar tack, offering products that run on both systems. Few will say who they expect to win the smartphone day.
A similar contest is also playing out in tablet PCs, where Microsoft has already gone full steam to ensure it dominates the sector even before any Chrome tablets come to market.
The sector is especially crucial for both companies, as Gartner says it expects some 10 million tablet PCs to be sold this year following Apple's (AAPL.O) launch of its iPad, which is based on its own operating system.
Many of the tablet PCs displayed at Computex ran on Windows operating systems, a fact Microsoft was eager to point out.
"Google hasn't shown it's capable of building that ecosystem yet, said Steve Guggenheimer, Microsoft's corporate vice president for original equipment manufacturing. "With Windows, one copy of your software immediately reaches hundreds of millions of users."
Google has been quick to dismiss claims the open-source nature of its Chrome and Android systems could be a handicap by creating too much product variation.
"There will already be millions of apps available when Chrome is launched," said Sundar Pichai, who heads the Chrome project at Google.
"You don't need to redesign Gmail for it to work on Chrome. Facebook does not need to write a new app for Chrome."
