Microdocs
suggests that Microsoft must compete with 'the Google Operating System'.

From a technical perspective it would be very easy for Google to become closer to the features offered by an OS. Previously I suggested that Google could start immediately with a much better 'Find' facility than the terrible Windows version, which is painfully slow and doesn't do full text search over documents on your hard drive.

From a business perspective, however, Google is unlikely to anything obviously hostile to Microsoft. Nobody wants to repeat the mistake that Netscape made when they tried to take on Microsoft and lost spectacularly.