OK, the Google Android ‘phone has been around for over a year now and has seen limited success but with real potential. As a die hard iPhone lover I had shunned an Android until I felt I really should understand where this is heading.
In the past week we have seen announcements that some major US carriers are going to be offering Android Smart ‘phones before Christmas. This news just adds to the reasons why we need to be paying very close attention to Google Android. If you pay attention to the Google share price (it has almost doubled in six months) you will see that some of the fuel for this growth in share price is the Android roll out.
The value of stocks can go down as well as up....
So, here are my five reasons you need to pay attention:
1. Network Access. Verizon Wireless, the largest US carrier will start selling two Android handsets before Christmas, one HTC, one Motorla. Good news for these handsets, bad news for Apple, RIM (Blackberry) in the handset department. Bad news also for Microsoft whose outdated Windows Mobile is being shunned in favour of Google. Bearing in mind the choices Verizon no doubt had, and regardless of how many Android handsets are sold this Christmas, this deal should be seen as a strong endorsement for the future of Android.
(The iPhone is still available only on AT&T in the USA. The Verizon deal offers a very real alternative to those people looking for a s,art ‘phone but not necessarily a Blackberry. The deal with Orange (and soon Orange & T-Mobile) in the UK means this is less of a threat on this side of the pond)
2. The Google Android Operating System is free to handset manufacturers. In this market, free is a very good incentive for handset manufacturers to try your software. Remember, Windows Mobile is outdated (and probably costs a lot of money), and the iPhone software is and will remain exclusive to Apple. If handset manufacturers and carriers are looking for the iPhone killer, they have the potential to gain one with little upfront investment or risk.
3. Android is Open Source. iPhone is not. Whilst both systems have app stores, the open source structure offers a greater ability to really see where this can go. I feel it is important also as the Android system, its apps, and the app market (on the ‘phone is atrocious) is not as polished as the iPhone. By making this open source it puts the power and responsibility for growth into the hands of a much larger connected audience which could see step change improvements as we move forward.
To quote Scott Morrison, WSJ
Mobile apps are critical for two reasons. Yankee Group estimates the U.S. mobile app market will reach $4.2 billion in 2013; meanwhile, consumers are likely to be drawn to the mobile phone platform that boasts the greatest number of apps. However, it becomes a chicken-or-egg debate because developers will turn their attention to Android as more people buy those phones, but consumers might be reluctant to buy Android phones without a robust set of apps.
4. Android is Hardware Agnostic. In part because of its open source nature, the operating system can be tweaked to deliver the right customer experience for each carrier and the ability to run on different ‘phones. If we look at two other options, the iPhone and the Blackberry – you can only use the iphone system on the iphone or the ipod touch. If you don’t like the iphone then tough, and in the States, if you like the iPhone but not AT&T – tough. The Blackberry is similar – whilst there are umpteen different Blackberry styles, its still a Blackberry. Android can appear on any network (subject to contracts) and on (virtually) any ‘phone type. Of course, the handset choice is limited at this stage but that’s because of the audience size – as Android increases in popularity so the investment in hardware will follow from manufacturers.
5. It connects seamlessly with your Google accounts. If you look at any of the major search engines over the past 10 years, they have all worked to grow the reasons to stay on the site, not leave it. With Google this has been the investments with iGoogle, Maps, YouTube, Docs etc. So Google are taking this strategy mobile, giving you the ability to use Google as you would on a computer. This in itself is nothing new, nor is it fully harnessed (I don’t get the same experience on Google Finance, for example, as I do on the computer) but with the sheer size of Google users (and growth) this starts to become an attractive option, to have all of your ‘stuff’ in one place. Android needs to work hard to ensure there are additional benefits or greater harmony between computer and ‘phone (vs. a Google app on the iPhone or Blackberry) for it to become a true killer. I believe this is a strong point moving forward, but one that needs to work right now.
The Future’s Bright The Future’s Android
There are many reasons not to like Android right now, not least the lack of polish, the small number of users and the lack of apps. BUT the reason you need to pay attention is that these will be fixed. The Verizon deal is big news as it paves the way for much quicker potential growth. If growth kicks off, then in will come more manufacturers, more developers and more money. Once this happens we will see a snowball effect with growth coming quicker and quicker.
Make no mistake, Google are in this to make money. It is no accident there is a search button the handset – they want to be your partner in mobile surfing and mobile searching. If you watch their video for Android 1.6 you will see they focus on your ability to search.Their investment now will pay dividends in a few years. If I was a betting man, I’d say those are going to be big dividends.
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Tweets that mention 5 reasons to pay attention to Google Android today | Jamie Riddell -- Topsy.com
on Oct 13th, 2009
@ 2:47 pm:
[...] This post was mentioned on Twitter by Jamie Riddell and Alex Diz. Alex Diz said: RT @CharissaCowart @jamieriddell: 5 reasons to pay attention to Google Android today: http://bit.ly/WucvT [...]
carlbennett
on Oct 13th, 2009
@ 3:32 pm:
Open source – or any other source – CANNOT offer any ability to “see where this might go.” This is just fan-speak. It offers no unique insight into anything. You hope it is going to get exponentially better. It doesn't mean it is. Saying open source puts “power and responsibility” into the hands of a connected audience sounds like Ministry of Truth new-speak for “offloads responsibility to a budget-free zone who have no power or legal liability.” In other words, some hobbyists can develop stuff for free, hoping someone will realise how clever they are. And your stupid American spell-checker is objecting to the S in realise, you Yankee imperialists.
…”which could see step-changes” is as true as “may not see step-changes.” This is just hype. It devalues your argument and makes you sound like over-excited cheerleaders. And not in a good way.
blackplastic
on Oct 14th, 2009
@ 10:12 am:
I think I'd have to temper your enthusiasm with on a couple of points:
1. I've not got the time or inclination but it would be good to see some other companies / markets indexed against that Google graph – after all the FTSE and DJI look to have seen as much growth over the period shown in your graph… Is this not just market recovery?
2. The fact that having android on potentially any handset is a good thing:
For a consumer I'm not sure this is the case… Sure, it gives them choice but it also makes that choice more confusing. It also makes developing applications significantly more difficult since no two devices are the same – it's this fact that makes developing for the iPhone fairly straightforward (and also makes the much-touted 'iPhone Nano' very unlikely).
3. Google have themselves said they they do not neccesarily aim to make money out of Android. Your point about the search revenues is valid but it is worth noting that the iPhone still has Google set as the default search provider. When discussing Android at length in Wired last year Google stated that the Android is as much about pushing the mobile internet experience forward as anything – if it gets killed by the competition because the other operating systems / handsets catch-up or overtake it and the iPhone then ultimately it will have done its job… This is a long-term strategy.
Alex
on Oct 14th, 2009
@ 12:33 pm:
Spot on Jamie.
Google OS cannot be ignored in the same way as Symbian cannot.
As smartphones become increasingly widely distributed so Apple's lead will be clawed back and it will become more of a niche device – as with PCs.
Canny companies would do well to test / launch apps on the platform to benefit from early learnings
Jamie Riddell
on Oct 15th, 2009
@ 9:41 am:
Perhaps my language was a little too 'excited' but I still believe the open source nature has a role to play. If we look at Browser market share we can see the second largest browser is Firefox – an open source platform. Is this growth purely down to it being anything other than Microsoft or was it due to the fact that being open source, it had the opportunity to become the browser for each individual through the myriad of customisation options provided by the apps, which were developed by many people due to its open source nature. I would also argue that WordPress, again being open has become a very powerful CMS platform due mainly the infinite customisation opportunities offered by the plug ins made from a large and diverse collection of developers.
Returning to the Browser market share, the biggest threat to Firefox growth is now Chrome, a Google platform….
This is an all British response, no cheerleaders present
Jamie Riddell
on Oct 15th, 2009
@ 10:36 am:
Adam, thank you for your points.
1. If you have time to look at the graph here http://bit.ly/21KoWL (can't see how I can include it in this comment) you will see GOOG is up 50% with the Dow up 26% and Nasdaq up 33.61% over the same period. Yahoo was up 20% and Microsoft 30% so they have indeed all benefited from the market growth but there is clear air [of growth] between Google & the market.
2. That is a fair point. More choice may = more confusion and it will be interesting to see how this pans out. Was it Nokia that lost big time when the 'clam shell' 'phone came out and they didn't have one in time? [I would need to look back] – I agree it is hard to top the iPhone right now but what if…
3. What Google say and what they mean are two different things. (“Don't be evil) – Google are a public company with commitments to delivering shareholder value. In everything else they have done there has been a business case to help grow the knowledge they possess (the latest being the rumoured Akamai deal) or directly grow bottom line. This “aw shucks, we don't mind if we get beat” communique wouldn't roll if there wasn't a long term business case for Google itself, not just pushing the mobile market forward.
Jamie Riddell
on Oct 15th, 2009
@ 10:37 am:
I agree that people should be on there to test. As I say, Android has many reasons not to use it right now, but those should be balanced with the long term need to understand. It is hard to see how the iPhone can be beaten but it wouldn't be the first time we have seen the leaders get toppled.
blackplastic
on Oct 15th, 2009
@ 12:26 pm:
3. Just to clarify – I'm not saying Google are just happy making the mobile internet bigger / better… I'm saying that their end goal is getting people to search more / view more ads / buy more on their mobile. Google derives income (either directly or indirectly) from all of the above – getting users to carrying out these activities on a mobile device is likely to increase the overall amount done online… Just look at the potential impact of price comparison apps on mobile (which compare online and offline prices based on a photo of a barcode).
So in conclusion I don't think Google is short-sighted enough to see a mobile OS they make no direct income from as being the end-goal.
Jamie Riddell
on Oct 15th, 2009
@ 12:32 pm:
I'm with you. The revenue is not necessarily from the OS but from facilitating more searching. I think we are in agreement, just expressed differently! I still think Google has a fee based revenue stream up its sleeve [not for Android] which is another story for another day