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Android leapfrogs iPhone OS: Looking beneath the surface

Posted in Industry updates, Mobile Devices and Company Updates by Manas Ganguly on May 13, 2010

Reading into Google’s long term thought in smartphones and mobile ads.

First the stale news: Android edged out Apple iPhone OS as the second best selling OS in Q1, 2010 (reports NPD’s wireless research). Only that it was expected. What with a avalanche of devices with Samsung, LG, Motorola,HTC and the new Android kids on the block: Archos, Dell and Garmin. What with support from 4 major operators? What with a 1+1 marketing gimmick and what with reduced pricing on the Androids? NPD reports Android to have notched up a No.2 position at 28%, below RIM at 36% and head of Apple at 21%. This strongly establishes the power of an OS that is not tethered to one handset. The Apple OS only operates on the iPhone and RIM’s only works on the Blackberry.

While it’s a fascinating story for Android and Google fanboys, what difference does the proliferation of the Android OS mean to Google especially since its not got a direct revenue model attached to it. On the surface of it, Android edging past iPhone OS was just about expected. Possibly in a quarter or two, Android will eclipse Blackberry as well with an impressive range of products lined up for future releases. While there are theories about Apple and the surge it would get in Q2 due to the iPad hysteria, Apple still is the best able to generate profits the best within what it produces. Remember Apple reported a 90% increase in profits for Q1,2010 over Q1,2009.

Why worry?
Google to me stands for democratization of platforms and services. Remember the free search and the vast Ad empire that Google put around its free search. The Android could be Google’s stepping stone in massifying their ad based revenues in the mobile world. Having more and more people across all demographics carry a Android phone can be quite a potent thing actually. Android would be integrating context and location (which they already do well) to push information and ads to people. Its “open” nature and a diverse eco-system would be instrumental in driving location and context aware ad placements.

Secondly, with numbers on its side, Android would become a more attractive destination with developers. Not only would they have scale but they would be more comfortable in Google’s Open Source compared to Apple’s “walled gardens”.

On the whole Android would thus strive for domination of the smartphone markets with its OS: A large diversity of handset and MID manufacturers, a good support from operators who love data, scale in terms of users and the most attractive developer destination. Is the Android strategy emerging? Should Apple watch Android?

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