The Web is buzzing today with talk about Google’s announcement late yesterday  that it is working on its own operating system, initially targeted at Netbooks. The lightweight operating system - geared toward cloud computing - is expected to hit the streets next year.

Analysts and industry experts are going to be watching this one closely - with two of tech’s biggest companies going head-to-head.

A few tidbits from Google’s blog:

• 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
• 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.
• 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.

And here’s what some others are saying:

From Wired.com:

Netbooks are cheap. So cheap that a disproportionately large chunk of the cost is made up of a Windows license. Ever wondered why the Linux versions of netbooks cost around $50 less? Microsoft tax. Chrome OS is based on Linux and will, like most Google products, be free, bringing the price of a $500 netbook down by 10% - not a small discount.

From CNET:

The move has widespread implications. One is that it shows just how serious Google is about making the Web into a foundation not just for static pages but for active applications, notably its own such as Google Docs and Gmail. Another: it opens new competition with Microsoft and, potentially, a new reason for antitrust regulators to pay close attention to Google’s moves.

From ArsTechnica:

One part of the announcement that may be causing a few grey hairs in Santa Clara: the Chrome OS will run on both x86 and ARM. Many manufacturers have been considering ARM in netbooks due to its exceptional power management capabilities, but the lack of a Windows port has undoubtedly held things back. A netbook-specific Linux with a high-profile corporation like Google backing it may change perceptions and help usher ARM into the space just above handheld hardware, where the architecture already dominates.

From PCMag.com:

Google’s new open-source OS will almost certainly beat XP and Windows 7 on cost, and will be lighter weight, but there’s no telling how it will be to actually use. The relative dearth of Linux on netbooks also shows that people tend to prefer a more Windows-like environment.