Google has had an advertising sales team in Seattle for a while now. But for months there have been rumors around town of former Westside developers opening a Seattle area Google outpost.
The proof that the Seattle office is open for business comes in the form of this post from former Avalon lead Joe Beda. (Check out this video of Joe, ironically, answering "Is Avalon a way to take over the Web?")
So what is Google building?
My bet is a browser that integrates the best features of the Google Toolbar (ala Mozilla and Safari) along with some next generation features like searching your browser history & RSS subscriptions.
When you look at the backgrounds of the folks they've recently hired, they are putting together a team capable of doing some innovative stuff with XML and client side applications. Looks like another case of "mooning the giant".
Redmond had this coming. After risking the company to bundle the browser into Windows, the IE team was stripped down and shifted over to the Longhorn debacle. The browsing experience suffered. When I joined MS in 2003, the IE team was a shell of its former self.
While the five year plan for (not) shipping a new OS was hatched inside the Longhorn team, pop ups (fueled by MSN among others), spyware, and security issues made IE a worse and worse experience as a browser. Toolbars from Google with pop-up blocking made this better, tabs in Mozilla, Opera and Safari (with Google built in) became the superior choice.
As if to tempt fate, they even released this video of the IE Product Unit Manager: I challenge you to watch 5 minutes of this god awful thing and not conclude these folks have lost their way. During my stint at MS I met a lot of folks who were talking and not doing - working off one big plan that never came together - making things more complicated than they need to be. And always finding excuses. Another browser war would be quite a comeuppance for this sort of sloppy product management.