Among Chrome OS’s advantages: Speed, simplicity and security. Every application will be a Web application. There will be no desktop apps. Chrome OS is essentially a browser with a few modifications. All data in the Chrome OS reside in the cloud. Pichai: “We want all of personal computing to work that way….If I lose my Chrome machine, I should be able to go out, buy a new [one] and re-create my previous computing experience easily.” Chrome OS will run completely inside the browser security model, he adds, noting that security is one of Google’s (GOOG) top priorities along with speed. “Turning on a PC should be like turning on your TV,” he says.

Chrome OS is very similar in appearance to the Chrome browser. “Chrome OS is Chrome,” says Pichai. Google made it look like a browser, because the browser is familiar.

And indeed, Chrome OS does look quite a bit like a browser. Multiple apps load into tabs, for example. It also features “Panels,” which Pichai describes as persistent lightweight windows. “All Chrome data resides in the cloud. Anything you put in the machine is immediately available to you anywhere.”

As netbooks become more advanced and battery life improves, they will evolve into entertainment devices, says Pichai, who notes that via Google Books, a netbook can become an e-reader, and through YouTube, a video device.

A quick demo of the user interface, which seems very simple and intuitive. “It just works,” says Pichai in an unintentional nod to Apple (AAPL). An interesting remark: Anyone who writes an app for the Web has written an app for Chrome, says Pichai, joking that Microsoft (MSFT) is already developing for it.

Speed, simplicity and security, says Pichai. We’re trying to make the computing experience delightful.

With that, Sundar Pichai hands the stage over to Engineering Director Matt Papakipos.

Papakipos, too, offers the “we want to make computing delightful” sound byte and notes once again that turning on the PC should be like turning on the TV.

Chrome OS eliminates the bootloader, auto-launching the browser. The OS also auto-updates itself, making sure that it’s always current with security patches, etc. Everything from the firmware to the kernel is secured with a cryptographic signature to ensure a secure boot. In the event malware is detected, the system repairs itself automatically.

The basic application security protocol for current operating systems allows apps the same privileges as the user. This presents obvious security issues. Whenever you install a new app, you’re taking a risk, says Papakipos. But Web applications like those that Chrome OS use are different. They are Web apps so they don’t have system-level privileges. Additionally, all apps run in secured sandboxes that are separate from one other and from the OS. Finally, all apps must be signed and verified before each use.

In terms of file systems, Chrome’s is locked down. It’s a read-only root-file system, obviously quite different from other operating systems. All user data are encrypted and synched to the cloud. Essentially, Google uses the PC for caching. Again, if you should lose your machine, you buy a new one, fire it up and it synchs with the cloud, restoring your previous computing experience.

Denied Internet access by Global Crossing and Hurricane Electric, bot-hosting network McColo is clearly having trouble spewing out spam and malware. There has been a 41 percent drop in spam volume since the Washington Post story broke.

Sadly, it’s certain to rise again, once McColo finds some new upstream providers.
(Thanks to reader Dave Barnes for the tip.)

And Google (GOOG) is serving up ads on it.

To be fair, though, it’s no easy task for the search giant to keep Blogger malware-free. So in some sense, the fact that the service hosts just two percent of all malware and not 20 percent is an achievement, as Sophos’s Graham Cluley notes. “If you think about it, Blogger/Blogspot’s position is probably not surprising–it’s a phenomenally popular platform for people to create their own Web pages (blogs), and gives Internet users the ability to comment on other people’s blogs,” Cluley said in a post to his blog. “Inevitably, there are ne’er-do-wells out there who will try and abuse a great service like that, and try and plant malware and malicious links. For its part, Google–the company who own Blogspot–takes security seriously, and works hard to shut down Web pages serving up malware.”

There isn’t yet a Guinness World Record for most software downloaded in a single day, so Mozilla will truly have rewritten the record books if it manages to set one. The group’s hoping for 5 million downloads–not an unreasonable figure, given that Firefox 2 was downloaded 1.6 million times the first day of its release. Indeed, Mozilla’s already well on its way to reaching that goal: 1,721,775 users had already pledged to download the browser upon its release today at 10 a.m. PDT.

What can they expect from Firefox 3? More sophisticated bookmarking, endless customization possibilities, an “awesome bar,” more robust malware protection and a browsing experience that Mozilla claims is seven times speedier than Microsoft’s (MSFT) Internet Explorer. Said Walt Mossberg, “Firefox 3.0 is the best Web browser out there right now” and that it “tops the current versions of both IE and [Apple's (AAPL)] Safari in features, speed and security.”

Clearly, Firefox 3.0 is a force to be reckoned with now more than ever before. As of May, the browser’s worldwide market share was 18.4%, while Internet Explorer’s stood at 73.8% according to Web metrics company Net Applications. Where will it stand after setting that world record?

Turns out, that number probably wasn’t too far off. According to an independent auditor’s report, Mozilla made $66.8 million in revenue in 2006, quite a bit of it from Google (GOOG). As former Mozilla Corp. CEO Mitchell Baker explained in a post to MozillaZine:

As in 2005 the vast majority of this revenue is associated with the search functionality in Mozilla Firefox, and the majority of that is from Google. The Firefox user base and search revenue have both increased from 2005. Search revenue increased at a lesser rate than Firefox usage growth as the rate of payment declines with volume. Other revenue sources were the Mozilla Store, public support and interest and other income on our assets.”

But those “other revenue sources” are piddling in comparison to Google’s contribution, which apparently accounts for a full 85% ($56 million or so) of Mozilla’s revenues.

So it’s supremely ironic then to hear Mozilla CEO John Lilly criticize Apple (AAPL) for distributing its Safari browser for Windows and OS X through its Software Update utility. “What Apple is doing now with their Apple Software Update on Windows is wrong,” Lilly said in a blog post on Friday. “It undermines the trust relationship great companies have with their customers, and that’s bad–not just for Apple, but for the security of the whole Web. … Apple has made it incredibly easy– he default, even–for users to install ride-along software that they didn’t ask for, and maybe didn’t want. This is wrong, and borders on malware distribution practices. It’s wrong because it undermines the trust that we’re all trying to build with users. Because it means that an update isn’t just an update, but is maybe something more. Because it ultimately undermines the safety of users on the Web by eroding that relationship. It’s a bad practice and should stop.”

Now, Lilly may have a point. But he’s hardly the best guy to be making it. As ZDnet’s Larry Dignan notes, Safari–like Firefox–features a Google search box, for which the search giant also presumably pays a placement fee. A sudden gain in market share for Safari at Firefox’s expense could have financial implications for Mozilla. “Let’s say Safari grabs 10% market share and Firefox falls to about 25%,” Dignan writes. “That’s fewer searches and less revenue for Mozilla. Sure, you can argue about whether Apple’s Safari move is above the board. You can also question the security implications and a bevy of other issues. But in the end, Apple’s Safari update and Mozilla’s reaction is like any other story. To truly understand it you have to follow the money.”

UPDATE: John Lilly wrote to me earlier today with a few comments about this post. Here’s what he had to say:

Hi John –

Wanted to follow up on your post just now about us and Apple and Google.

Take this for whatever it’s worth, but revenue and market share didn’t enter my mind when I posted. At Mozilla we obviously care about having enough resources to keep the lights on and pay people, and we care about having enough market share–because it means that we’ve built products that people really care about.

But competition is good and healthy, and essential. Without competition we’d all be in a pretty bad world–sort of like AT&T in the bad old days.

I’ve got zero issues with Apple using their channel to distribute other products–I think that’s a perfectly fine thing for them to do. What I worry about is that users need to trust the security updates they get from their vendors–because if they don’t–if they think there’s an ulterior motive other than keeping software up-to-date–that’s a problem for everyone.

Anyway, I respect your right to write what you think and to be skeptical of the motives of folks like me, but I do say sincerely that in this case, revenue has nothing to do with it.”