For the last hour I have been testing a Google Chromebook made by Samsung.

At $249 there is not so much you can complain about.  It is a decent piece of hardware for a super low price. If the competition is say a MacBook Air for $1000, which is what the hardware resembles, the price is unbeatable.  But is it a MacBook Air? That’s the problem.  It is far from it. The Chromebook is a solution if you are both addicted to Google Products and are broke.  Otherwise it is much better to get a MacBook Air, a Windows PC, an Ubuntu PC, an Android tablet or an iPad mini.

Now if you, like me, find glass keyboards only a temporary solution in your life, a price to pay for the lightness of an iPad or an Android tablet, but an inconvenient way to write a post like this one, then you need a real keyboard.  And if you need a real keyboard until now your choices were a PC, a Mac, a Linux (Ubuntu) PC.  As of this week you can add a Chromebook to the list, especially if you are on a budget. Because the Chromebook has a real keyboard, it’s simple, light and fast, it opens and shuts like a MacBook or better.  But while the MacBook Air is a machine that can work in standalone mode and online, the Chromebook is practically useless when it’s not online. The Chromebook is all you can ever do with the Chrome browser in one PC. Plus a very limited set of functions that do not require you to be online. The Chromebook is a cloud based device where the cloud is Google.

On the bright side, as a cloud device, the Chromebook comes with a 100GB Google Drive which is like the biggest Dropbox you have ever encountered, and it does have an SD card reader that allows you to upload any type of files to your Google drive, most commonly pictures and videos to the cloud. Also it has an ARM processor which is the processor type that tablets and mobile devices use and different companies license from ARM.  This processor consumes much less power and the Chromebook runs fanless and cold which is phenomenal if you’re fed up with how the Macs burn your legs after some time.

Conclusion, if you are already a fan of Google products and are on a budget go for it. Otherwise get an Intel based PC if you like Microsoft or a Mac, or reflash your Windows machine with Ubuntu.  All those choices will give you many more functionalities that are unavailable in a Chromebook like for example, iTunes, photo editing programs, video editing programs, and so on.

Now the question is, why not build a Chromebook that runs Android?  I would love that, to have access to the Android app eco system, to be able both to type and touch the screen.  I would like to see exactly the same hardware with Android, maybe there’s a hack for that. I could not find it.  What I did find is a hack to make Ubuntu run on a Chromebook.  Will try that next.

The two biggest challenges that Google is facing are that ads are tough to show on smartphones (because they are narrow) and more and more searches come from smartphones, and that Facebook is competing harder and harder in an ad based world that Google cannot enter.

The biggest opportunity I see for Google is to turn Motorola around and have an integrated/open ecosystem that catches up with the closed Apple ecosystem. I am not argue that Google makes Android a closed system like iOS and only sells its smartphones through what is now Motorola. What I am saying instead is that Google could be in the position that HTC or Samsung are today. It could make the best Androids and use a hardware OS combination to make money a la Apple.

Android is bigger than iOS and yet Apple is worth over twice as much as Google in market cap. iOS is 90% of the value of Apple. Android is considered to be less than 10% of the value of Google. This is where Google’s biggest upside resides in my view. In an successful implementation of the Motorola acquisition.

In any case I think that there are 3 companies that are a must have in anyone’s portfolio now and they are Google, Apple and Amazon, in proportions to their market caps. Facebook would also be a must have but not at 100 times earnings. I should also clarify that I have Google, Amazon and Apple in my portfolio and have for a while.

I am testing Google TV for the first time, it’s like Apple TV + Chrome. The Logitech execution is poor, lots of work to be done. It’s shocking that Logitech put the enter and the delete buttons so close to each other that many times you want to enter, you delete. I don’t think Google’s method of allowing everyone else to build anything off their code really works. At least Apple retains control of the final product. Google bought Motorola and that is great. I am not saying Google should not license. But Apple is showing that corporate fascism pays off. Somewhere in between is best.

A few weeks ago I wrote that Google had to buy a smartphone maker.

I am very glad they bought Motorola. Google has very little to lose buying Moto and a lot to gain. Motorola is affordable, has good IP, is in USA, and even though they clearly don’t make the best Android phones now Andy Rubin will make sure they do.

And $9.5bn is what Google could afford (Moto has $3bn in cash). HTC is a much better company but $50bn is tough even for a $150bn Google. Samsung impossible.

Now the challenge is to make sure that the level playing field continues that Samsung, HTC, Sony Ericsson and others don’t feel discriminated and if GoogleMoto wins is because they just make the best hardware/software experience.

Of course there is a risk that Android partners will try to help promote Windows Phone but for that they are late after Nokia and in any case mobile operating systems can hardly be pushed. Microsoft has so much cash and resources and with all their might WP is selling 15K units per day while Android sells 550K. A mobile OS is like a social network of geeks where the people are the apps developers. And in a mobile OS as in many other things in life, money can’t buy you love. It helps, but it doesn’t buy it.

After four years of working with Google as CEO of Fon (Google is our largest non financial investor) I would like to share what my experience has been like as a way to answer what I consider Larry’s biggest challenge as new CEO is. I write what follows in a spirit of friendship, with tremendous admiration for what Google has accomplished, and gratitude for its investment in Fon.

Google is an incredible company, a global giant that has just announced record financial results. A company that was built with a combination of great ideas coming mainly from its founders and amazing execution on the part of Eric Schmidt. But the biggest challenge I see at Google is that it still works like a university. This needs to change. At Google many managers come up with their own projects, frequently without a real connection to the whole enterprise and without real leadership from the top. As a result most fail. Google is a collection of brilliant minds, which is great for research but not for the execution of a visionary masterplan.

My concrete experience with Google relates to WiFi. In this field over the last four years I had the opportunity of watching Google hoping and failing to become globally relevant in WiFi connectivity. In the meantime 50 employee Fon has become the largest WiFi network in the world with over 3 million hotspots mostly in Japan and the UK, growing in other countries and hopefully soon in USA as well. But other than the investment for which we are grateful, everything else we tried to do with Google was a failure.

What I saw in Google’s WiFi´s effort were different “professors” running around with different ideas, trying to line up Google resources behind them only to end up with aborted projects. Initiatives like WiFi San Francisco, municipal WiFi throughout USA, never took off because of lack of company wide support. And WiFi is but one example. There are many areas in which Google has experimented and failed because of lack of vision, focus and consistency. For example the Orkut vs Facebook lost battle or the Twitter vs Buzz debacle. Googlers work for a great corporation but when they need company wide support for their initiatives most of the time they don’t get it. Sometimes they leave in frustration. Employee churn is now a big problem at Google and it needs not be. Churn comes from first making people believe they can do anything but then depriving them of the company support that is needed to succeed in their endeavors.

What Larry Page needs to do now is to change this situation and this can only be done by narrowing Google’s focus. Larry needs to spend weeks going over each Google project in detail. In this process he only needs to ask: Does this project make search or Android better? If it does not, kill it, and redeploy those talented employees into projects that do. And Sergey, in his new role as the head of business development needs to have the same discipline and only stick to new projects that enhance the two core areas of the company search which includes ads, and Android. Android is an incredible success so far and can be the computing platform of the future. Google TV should also be closely integrated with Youtube and in the end be part of Android. Youtube is another amazing but disjointed asset, add full length content and music to it and you have the iTunes that Android needs. Google Chrome is a huge success and that is good because those of us who use it (120 million of us) love to search off the browser box. If Larry succeeds in focusing, and I think he will, Google employees will work in projects that are backed by the company and are part of a common vision. Employee churn will decrease. Google will do even better.

As it stands today, in terms of management, Google is the opposite of Apple. Steve Jobs, who I had a chance to meet in private, is a genius dictator with a very strong vision. The whole company aligns behind him to execute. And lately, Apple’s Spartan style is winning over Google’s democracy. Larry and Sergey need to learn from Steve: to lead, to be tough and to say no (but hopefully without Steve’s ability to humiliate others when making a point). Google, like Apple, needs to adopt great design. I know that both Larry and Sergey come from the design school of “I don’t care how it looks so long as it works brilliantly”. Still I wonder how many people are not using AdSense because of how ugly the ads are. Apple has shown that both design and functionality are needed to succeed. For us at Fon, Apple, a company that is not even our investor, has been surprisingly easier to deal with than Google. Apple wants WiFi everywhere. That simple. In Japan, every iPhone is sold with a Fonera so there is more WiFi. We did a simple integration, it works well, and we have deployed millions of foneras in Japan together with Softbank. At Google, so far, we have been unable to integrate with Android regardless of the fact that we are partly owned by Google. We are millions of units ahead with iOS than Android. And every other project that we tried to implement with Google did not get off the ground. Failed to gain company wide support.

We all like democracy, but businesses, whether we like it or not, are more dictatorships than democracies. Even employees who like to debate issues outside of work prefer a clear sense of direction from those at the top at work. A clear mission. Google is not a start up that needs to find its destiny. Google has found its destiny and it is great. Time has come to focus on it and execute with a more forceful management style.

Disclosure: I am a happy Google shareholder and I am thankful to Eric, Larry, Sergey and all Google employees for their rising value.

First the usual disclosures. Google is an investor in Fon. Twitter has no relationship with Fon, but I know Ev Williams a little and some investors like Chris Sacca well. Personally I think that neither investments nor friendship will taint the objectivity of this post, but disclosing is better than non disclosing.

Now the post.

Google knows that Twitter is both an opportunity and a threat. Twitter is a threat because it is instant search – compared to Google’s crawled (slow) search – but also because, in many cases, Twitter yields better results. For example, what is the point of collecting a 3-year link history for a fashion brand and give search results if the most relevant information about that fashion brand may be that 5 minutes ago a hugely followed celebrity says she’s crazy about it. Twitter is now big enough to move the needle in the real world quickly enough for Google to miss it.

Now here is the opportunity:

Google is great at creating hierarchies of information. The original idea of Google, which comes from science, is that “he/she who is linked to the most must be saying the most relevant things”. Now what is missing is that same analysis but cranked on Twitter data.

How would I refine search in Twitter? To me there are two measures of Twitter relevance. One is how many followers a persons has, and the other one how frequently this person is retweeted. In my opinion, the opportunity for Google is to use its computing power to come up with very relevant, instant answers to problems using Google results, Twitter results and when using Twitter ranking according to followers and retweets. To that, it should add PINGED results, namely results whose location on the web has been volunteered as in blogs or news. To see a ping search engine check out Technorati in which I am an investor.

Google created a meritocracy on the internet. If you have a high Google ranking, what you say, for example in your blog, matters more in search. Well, I think Google is the company most equipped to blend crawled search with real time search by combining Google results, Twitter results and PINGED results (results that were not crawled but picked up from recent blog and news pings).

Here’s a small experiment I did called “unfolding news” that shows the beginning of a twitter+news+blog results. This is what you get when you search for “ash cloud” in unfolding news. This is what you get when you search for “ash cloud” in Google. Unfolding news is an experiment that does not use Google results, but I find it more useful than Google for learning about things that are happening or “unfolding”. Google could do a much better job blending “old web” and “new web” sources.

Conclusion: instead of wasting time with Buzz emulating or copying Twitter, Google could complement Twitter with what Twitter needs most, making sense out of searching something in Twitter.

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Buy a new Apple device, cloning an old one is easy. Buy a new RIM or Microsoft, cloning an old one is hard. Hence Apple’s growth. RIM, Microsoft have to learn that the key is to get you to buy new products as frequently as possible. Many people don’t buy a new windows laptop because it takes a day of hard work to move your info and programs. Apple makes it so easy.

Flash may be buggy, but the non flash iPad surfing experience is like watching B&W TV. I really can’t use my iPad regularly. All sorts of unexpected websites don’t work. Today it was one for adopted pets. Could not see pictures in it.

Downturns are great moments to gain market share. Think of Google when it got started. If you are a survivor in a downturn you are the predominant colony, as with bacteria exposed to antibiotics.

In January mobile users consumed 139MB of data. A year earlier each used only 38MB. Mobile data usage is exploding. 3G networks can’t cope. Hence Fon’s growth.

I find the iPad most useful in situations in which laptops are frowned upon. I had a board meeting at www.ie.edu and nobody used laptops. The iPad was discreet and did not offend anyone.

MBA programs are countercyclical as opportunity costs fall in recessions. Last year was IE’s best.

The Bologna Agreement is like the euro of University education. It unifies the European educational market for the institutions well position to take advantage of it.

Most in power in Europe would rather see Greece sink, than the Euro rise again. But not totally because most of the Greek debt is in the hands of German banks.

I just watched TV. Hadn’t done that in ages. Was surprised to see commercials not made for me.Products I could not possibly buy.

The paradox of the music industry is that it’s being destroyed out of love for music. If people didn’t care about music they would not make such efforts to get it without paying rights.

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Image representing iPhone as depicted in Crunc...

According to a recent report from Admob, a company bravely and so far successfully competing with Google on mobile advertising, today about 8% of requests to their servers come from WiFi networks, while the same was 3% in August. Use of WiFi from mobile devices is increasing thanks to devices like the iPhone, T-Mobile’s G1, and WiFi-enabled Blackberry phones spreading really fast.

Interestingly on iPhones 42% of requests come from WiFi, while for other WiFi phones the average is between 10-20%. According to Om Malik this is due to AT&T’s spotty 3G coverage and to the company’s efforts to offload traffic to WiFi. I believe what also plays a big role is the great job Apple did integrating WiFi on the device and the fact the OS on the iPhone forces bandwidth hungry applications to use WiFi whenever it’s available, saving huge costs to the network operators and giving users better speed and service. This proves that 3G and WiFi are more complementary than competitive and grow in tandem.

Nokia CorporationImage via WikipediaWhat is best to be Nokia or Apple? When you look at Apple´s financials and compare them to Nokia financials you clearly see that Nokia is doing much better than Apple except on one item: Market cap. This is the same with Microsoft and Google except that Microsoft´s market cap is still higher than Google´s. But the concept is the same. Investors give the Silicon Valley companies a much higher P/E. They believe that Apple and Google are on the rise, and Microsoft and Nokia on the decline. Looking at this and knowing about all the common ties including common board members that exist between Google and Apple I wonder why Nokia and Microsoft don´t have closer collaborations, especially now that Apple has gone after Nokia´s lunch, high end phones. But Nokia still sells in only one week as many phones as the iPhone has ever sold. Investors lose track of this. And Nokia´s CEO Olli-Pekka Kallasvuo seems to have a clear view of who his competitors are.

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Here´s a view of how Google will make Youtube disappear. Personally, I don´t agree that that will be the case. Indeed, if I had to guess I would not be surprised that Google Video will do to Youtube what Google WiFi did with FON, and that is to establish a healthy competition with an internal project and an external one which Google partly or wholly owns. And, surprisingly, the internal project may very well lose and yet not dissapear.
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