I am also seeing this on latest dev
Chrome version: 69.0.3473.0
OS version: 10820.0.0
Termina version: 10869.0.0

From crosh, it looks like termina/penguin have both been started. However, clicking the Terminal or other app icons just hangs.

I don't seem to be seeing this on canary, so might be fixed.

My penguin is back. I'm a happy camper.

Dupe of  issue 863615 ?

I think I found the race though.
In garcon: https://chromium.googlesource.com/chromiumos/platform2/+/master/vm_tools/garcon/main.cc#175

HostNotifier::Create will notify cicerone over gRPC that garcon is ready before the gRPC server is started. That wasn't an issue before, but now we do some PackageKit proxy setup in between notifying the host and starting the gRPC server. This gives the host time to notify Chrome of container startup, and for Chrome to fire off a D-Bus call (LaunchContainerApplication or LaunchVshd) back to cicerone, which then fails since garcon isn't ready yet.

Fix at https://chromium-review.googlesource.com/c/chromiumos/platform2/+/1145777

The following revision refers to this bug:
  https://chromium.googlesource.com/chromiumos/platform2/+/810af32ea3322a77c8901eefea37378518a7502a

commit 810af32ea3322a77c8901eefea37378518a7502a
Author: Stephen Barber <smbarber@chromium.org>
Date: Sat Jul 21 20:19:00 2018

vm_tools: garcon: fix startup host_notifier race

garcon must not notify the host until its gRPC server
is listening.

BUG= chromium:865246 
TEST=garcon still starts up; Linux apps starts reliably

Change-Id: I0e6eb656faa55eb270b6d89a2688750ab76dcd49
Reviewed-on: https://chromium-review.googlesource.com/1145777
Commit-Ready: Jeffrey Kardatzke <jkardatzke@google.com>
Tested-by: Stephen Barber <smbarber@chromium.org>
Reviewed-by: Stephen Barber <smbarber@chromium.org>
Reviewed-by: Jeffrey Kardatzke <jkardatzke@google.com>

[modify] https://crrev.com/810af32ea3322a77c8901eefea37378518a7502a/vm_tools/garcon/host_notifier.cc
[modify] https://crrev.com/810af32ea3322a77c8901eefea37378518a7502a/vm_tools/garcon/main.cc
[modify] https://crrev.com/810af32ea3322a77c8901eefea37378518a7502a/vm_tools/garcon/host_notifier.h

This will need a component push.

 Issue 864274  has been merged into this issue.

Your change meets the bar and is auto-approved for M69. Please go ahead and merge the CL to branch 3497 manually. Please contact milestone owner if you have questions.
Owners: amineer@(Android), kariahda@(iOS), cindyb@(ChromeOS), govind@(Desktop)

For more details visit https://www.chromium.org/issue-tracking/autotriage - Your friendly Sheriffbot

The following revision refers to this bug:
  https://chromium.googlesource.com/chromiumos/platform2/+/f4f6e726c6d37f7fb4d28a38dc565ab6a9c32149

commit f4f6e726c6d37f7fb4d28a38dc565ab6a9c32149
Author: Stephen Barber <smbarber@chromium.org>
Date: Wed Jul 25 03:27:55 2018

vm_tools: garcon: fix startup host_notifier race

garcon must not notify the host until its gRPC server
is listening.

BUG= chromium:865246 
TEST=garcon still starts up; Linux apps starts reliably

Change-Id: I0e6eb656faa55eb270b6d89a2688750ab76dcd49
Reviewed-on: https://chromium-review.googlesource.com/1145777
Commit-Ready: Jeffrey Kardatzke <jkardatzke@google.com>
Tested-by: Stephen Barber <smbarber@chromium.org>
Reviewed-by: Stephen Barber <smbarber@chromium.org>
Reviewed-by: Jeffrey Kardatzke <jkardatzke@google.com>
(cherry picked from commit 810af32ea3322a77c8901eefea37378518a7502a)
Reviewed-on: https://chromium-review.googlesource.com/1149560
Commit-Queue: Stephen Barber <smbarber@chromium.org>

[modify] https://crrev.com/f4f6e726c6d37f7fb4d28a38dc565ab6a9c32149/vm_tools/garcon/host_notifier.cc
[modify] https://crrev.com/f4f6e726c6d37f7fb4d28a38dc565ab6a9c32149/vm_tools/garcon/main.cc
[modify] https://crrev.com/f4f6e726c6d37f7fb4d28a38dc565ab6a9c32149/vm_tools/garcon/host_notifier.h

Verified on eve 10888.0.0, cros-termina 10895.4.0. The new component version is now live.

This issue has been approved for a merge. Please merge the fix to any appropriate branches as soon as possible!

If all merges have been completed, please remove any remaining Merge-Approved labels from this issue.

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For more details visit https://www.chromium.org/issue-tracking/autotriage - Your friendly Sheriffbot