This is an interesting move. MSFT, which owns the productivity market, is now opening itself up to an attack by releasing a translator that will convert documents from the  Open XML format to the OpenDocument format. This is not a bad move since interoperability works both ways. One reason people switch products is due to direct network effects -- they want to be able to interoperate with others using the same software. With this convertor, Office users can continue to work with colleagues that use the OpenDocument format. While most users use a small percentage of the bloated functionality in Office, some users like the seamless interoperation between products within the Office suite and even the broader MSFT suite of enterprise applications. With this move, MSFT keeps the open format options alive for users and not making it a choice between independent stacks (MSFT vs. OpenSource or J2EE). Since Office users constitute the larger userbase and revenue source, any threat to this core group will have a big impact on other products and services. This move may help them solidify their user base!

This product has already had an impact on EBay's PayPal unit. The Boston Globe reports that the head of PayPal will be leaving the company. The same article reports that EBay is not permitting its merchants to list Checkout as an option. YouTube has an interesting video about checkout.

We have known for a while that Google has invested heavily in data centers. A recent NYT article highlights Google's investment in hardware and operating systems. An interesting tidbit was that Google is now the fourth largest maker of computer servers. They are investing in chip design, and have patents in drive-cooling technology. On the OS front, they have implemented a program -- MapReduce -- that can allow a novice user to exploit parallel processing technology for their problem solving. The same article estimates that upto 30% of coding time is spent on figuring out how to turn the code that can be used by the parallel processors. A second innovation on the OS arena is the Google File System that is used to keep data on the distributed server farms. This is helpful when servers fail and the system should automatically reconfigure itself without losing any information or reliability. A third innovation is Google Work Queue. This is also refereed to as virtualization technology that allows task to be assigned to servers and make it seem as if each task has a dedicated server. The same program provides load balancing services on a global scale.

A NYT article describes how YouTube created new demand for a sitcom that was turned down by several networks. In this business independent creators develop programs that they sell to networks (ABC, NBC, WB). Executives within these networks pick new programs based on some pilot testing or on a hunch. This article shows a new method by which such pilots could be run on properties like YouTube or MySpace and then selected by the network. A byproduct of this method could be a loyal viewer base that could form the core of the fanbase on the Internet.