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The tale of two Steves- Bee and Jay

Posted in Computing and Operating Systems, Device Platforms by Manas Ganguly on August 28, 2013

The two Steves- Bee and Jay have been vanguards of technology – and yet the difference between them couldnot have been stark. Everything Jay was Bee wasn’t. Bee’s accomplishments are an antithesis of the achievements of Jay. This is the follow up on my earlier post – Microsoft’s lost decade and it looks down upon (Literally) on Bee’s big judgement errors….

Bee and Jay

A good part of the 90s and early 2000s will be remembered as Microsoft’s decade – and Microsoft was the most dominant force in the technology space, the Alpha-male in technology. The ubiquitous Wintel partnership as it was then however fell behind the Moore’s law and grossly underestimated the migration from desk stationed devices to handhelds. Even while Microsoft had launched its Windows Mobile in 2000 and brought out the first tablet in 2000, Gates, Ballmer & Co misread the shifting sands in personal computing and were unable to capitalize on both these fronts. On hindsight, Microsoft did not open up to the eco-system effects and benefits – and were more happy selling proprietary licenses – A lack of flair and foresight there, which precipitated into a losses that we see today. Put simply – The world has moved faster that Microsoft’s licensed software business model could respond (Analyst Ted Sandler)

Here’s comparing how the two Steve’s measure up on different and yet common device, technology and platform initiatives-

Apple versus Microsoft - the story of two Steves

The list doesnot quite stop there – There’s Microsoft’s wasteful effort on Bing versus Google and its advetures with XBox and Kinect versus Playstation. To me Xbox and Kinect were ideal innovations – but Microsoft and Bee failed to push it… across platforms. Microsoft worked across disparate platforms and was never able to integrate the customer experience across devices and platforms. And then again, projects such as Microsoft courier never saw the light of the day – the plug pulled out through half way.

Bluntly put – Technology is one thing – the ability to conceptualize the portfolio, integrating the services in a manner of user experience that is engaging and habit forming, a layer by layer structured format of business allowing scalability of services and devices into different domains is something that Ballmer missed upon very completely. Take an Apple for instance – It started with an iPod, created a layer of services around it (iTunes), scaled the device into new form factors , upstaged the Music industry, leveraged the design into a smartphone (iPhone), scaled up another service layer (Application Store), upstaged the industry and leveraged it yet again for new device/dimension (iPad) and upstaged the industry all over again – there is this continuity in design, form factor, service, portfolio and monetization streams. Instead Microsoft had a Windows media Player, a Zune, a Zune Media Store, an Xbox and a Kinect, a Surface – they are all great pieces plagued by a discontinuity. The best examples being xBox and Kinect – good innovations, mind numbing possibilities and yet these innovations have struggled to give Microsoft worthwhile mileage.

What they said ... when Steve was asked to retire is not all that great!

What they said … when Steve was asked to retire is not all that great!

Steve (Jay) put the Microsoft problem in a neatly worded statement: “ The trouble with Microsoft is they have no taste. They have no taste and I don’t mean that in a small way, I mean that in a big way.” Absolutely right Steve! Ballmer’s successor clearly has an awful lot of work to do….

Steve Ballmer & Microsoft’s Lost Decade

Steve_Ballmer_peace

Steve Ballmer, CEO Microsoft since January 2000 is to retire from his post within the next 12 months. Rumours are that our man was asked to march since the board was not too please about the $900 Million write offs on a spate of current projects. Within a few hours of this release, Microsoft stock jumped by $2.36 (7.3%) over a broad trade of 223.3 million shares. The news of Ballmer’s exit added an immediate $20 billion to Microsoft’s capitalization.

The movement of the MSFT scrip shows a variance of 97 cents on 23rd August with the share touching $34.97 post Ballmer's Announcement. Initial Euphoria?

The movement of the MSFT scrip shows a variance of 97 cents on 23rd August with the share touching $34.97 post Ballmer’s Announcement. Initial Euphoria?

Over the course of last 14 years, Microsoft hasn’t really done significantly different – besides sharing the spoils with investors in terms of dividends. Yes, it has increased the market capital of Microsoft – but as far as results go – there is hardly anything much on the board. With Ballmer at the helm – Microsoft has actually offered negative returns. Ballmer can be credited with an effort to shift strategies at Microsoft – but it didnot really pay off.

MS Share Prices

If you compare the indices of Microsoft versus Dwo Jones, NASDAQ and S&P500, the picture that comes through is an eye opener.

Microsoft Compared

To put the numbers – Dow Jone outperformed Microsoft by 3X in Ballmer’s Decade, S&P outdid Microsoft by 10% through the Decade. The face saver was NASDAQ, the technology index itself dropped by 10%. Compare Microsoft’s stagnant share price to 700% increase in Gooogle’s share price value and a 1600% escalation in share price of Apple.

Microsoft versus Apple & Google

Microsoft S&P NASDAQ DJ

Infact, Apple’s Get a Mac campaign was a very clever lampoon of the archetypical Ballmer personality. In Ballmer’s decade, Apple overshadowed the Redmund giant and emerged as the quintessential technology business after bringing the revolutionary iPod, iPhone, and iPad platforms to market. To date, only Google Android has emerged as a formidable rival to the popular Apple iOS operating system. Meanwhile, Microsoft and Ballmer have been literally caught with their pants down. In hindsight – Ballmer never really estimated the eco-system effects and advantages and consequentially was never able to capitalize.

Ballmer met some degree of success with the Microsoft XBox and Kinect – the only game changers. However, XBox and Kinect have not translated into any huge seismic impact – quite unlike the other Steve in town – the one from Apple.

Steve Ballmer’s greatest gambit (and his greatest failure in course) was Windows 8 – The equivalent to the promised land for Microsoft – the back bone of Microsoft’s future in personal computing from Tablets to Laptops to Smartphones. A year of Windows 8 later –

1. Windows 8 has not even nudged the cash registers at Microsoft
2. Reports have suggested that Windows 8 sales and adoption has trailed behind Vista at similar points of Product Life cycle chronologies
3. Windows is still some distance from being able to make a mark in the Tablet segment even while PC Desktops and Laptops keep getting written off… PC Markets have been shrinking for 5 consecutive quarters and there appears no hope of recovery in the horizon
4. At low single digits market shares in Smartphones and Tablet markets – Microsoft is a relative non factor. At Microsoft’s scale – they ought to be looking at upstaging Android and not be overjoyous about the decline in Apple.

It is perhaps ironical, that Microsoft and its Wintel partnership must fail to Moore’s law. Wintel understood the law pretty well in terms of size and power management principles – but miscalculated the consumption shift towards smartphones and tablets.

To sum up, Steve Ballmer has been very instrumental and effective in running existing product lines – but in terms of innovation and new products – Ballmer has been less than good and the 13 years at helm of Microsoft have been years of opportunity loss – Microsoft’s lost Decade.

The Real Impact of Android on Google

Posted in Computing and Operating Systems by Manas Ganguly on June 13, 2013

>Android Controls 70% of the global smartphone sales and is catching up on Apple’s tablet dominance at a fast trot. Android’s rise to dominance in global markets has been a phenomenon. Amidst worries of the platform segmentation and the dark Androids, the Android OS is making money for Google on the digital and mobile space – and tons of it if latest numbers from eMarketer’s worldwide digital and mobile advertising revenues are to be believed.

Android is help Google corner more than half of $8.8 billion advertisers spend on mobile internet ads in 2012. In the overall digital space, Android’s dominance gives Google a third of the digital ad dollars spend, globally. In terms of numbers, Google tripled its mobile ad earnings in 2012 over 2011 and clocked $4.61bln. For 2013, eMarketer expects the growth to be around 92.1% (around 2X of the $4.61bln in 2012) to $8.85bln. Google holds a very strong pole position in the Mobile Internet Ad revenues through 2011-13 and is seen to be increasing its market shares – all thanks to Android.

Google Mobile Internet Ad Revenues

Globally, Google reigns with $32.73bln in net digital ad revenues in 2012 which constitutes 31.5% of the market.

Google Digital Internet Ad Revenues

With blockbusters such as Google Search on Digital Medium, Android on Mobile medium and YouTube on Video Medium it is not any matter of wonder that Google will continue expanding its digital ad revenues and shares.

Eastern Philosophies and the Future of Wearable technology!

Posted in Computing and Operating Systems, Device Platforms by Manas Ganguly on June 3, 2013

Google Glasses superimposes a layer of information over the field of vision – popping out relevant (ad supported) tidbits of information on the Go. But is that all it is to it?
Whats more to the Apple iWatch apart from all the fancy and possibly a Nike Fuel styled Pedometer and calorie counter?

ying-yang

What we see to Google Glasses and Apple iWatch may be the beginning to something more holistic and internal to the user. Eastern cultures call it Qi/Chi (Chinese), Prana/Chit (Hindu), Lung (Tibetan Buddhism); Western cultures simply call it “Life Force”. Wearable computing in its core could be a powerful complement to this life force – whether it is Pulse/ Systole and Diastole or it is Pupillary response/Miosis and Mydriasis or the greek concept of Kairos (the qualitative aspect of time)

03062013

Reaction to external stimulus is much more sure, subtle in measurement of these body functions and thus can be the platform to much more immersive and persuasive experience and engagement. Apple is ideally positioned on the wrist to read Systolic/ Diastolic pressures and the Google Glass with a few changes can be positioned to read and record pupillary movements (or who knows- the pineal gland?). Samsung is already reading movements of the eye basis which they are powering the scrolling functions in its latest range of devices.

Juxtaposing subtle body reactions to the construct of profile, context, time, location, online habits etc – could be a very powerful business driver at a very basic level. It could open up health, wellness, diagnostics and other medical/ wellness segments.Apple and Google are racing ahead of times – to position themselves at the intersection of the external and internal worlds of users. The focus with wearable devices is to seek and study subtle reactions of the body and build the next generation of applications and businesses which is more internal to the user. The ability to create experiences based on the life force of the consumer is possibly the determinant of the future.

Should Google be worried about Samung?

Posted in Computing and Operating Systems, Mobile Devices and Company Updates by Manas Ganguly on May 21, 2013

Samsung shipped 42% of the Android phones in 2012. HTC was No. 2 at 6%. Samsung is the big Gorilla of the Android kingdom. All others are simply chipmunks. Even while a lot of other OEMs have tried to take the Android flagship – but if there is one line of Androids that goes head to head (and has possibly dethroned) the iPhone, it is the Galaxy series of phones.

So is Google under threat from Samsung? The possibility cannot be ruled out-

• The threat centres on the possibility that Samsung is in a position to demand a greater share of Google’s mobile advertising revenues derived from search and other products.
• Samsung could also follow Amazon’s approach to the Kindle, which forked Android and cut off the core Google apps that generate revenue for the search company.

Google’s acquisition of Motorola Mobility, which makes smartphones and the Xoom tablet, was an “insurance policy” against such an event.Samsung, of course, is also moving to reduce its reliance on Android as Google develops its plans around the rumoured X Phone, with the scheduled release of Samsung handsets based on the Tizen OS later this year.

However, I am of the view that Google should be more worried about the cheap Chinese devices from the sweat shops of Shenzhen. Its not (just) about the consistently lower levels of engagement – a far cry from the Apple iOS. Thats a secondary worry. What should worry Google more is the faceless, nameless $45 commodity Androids. In the last count a third of Gartner’s smartphone numbers were from these small and fragmented device makers. These faceless, nameless Androids (Call them Black Androids) have no monetization value for Google Services – most of them come without a Google Play store.

Beyond the search and advertising revenues that Google makes from Android, there are those bits of signalling data- that the low cost Androids miss out – those valuable bits of information that map the user holistically. A data mine that can be leveraged for data with relevance to the user. The real structural benefit to Google from Android comes from the understanding it gives of actual users, and the threat comes from devices that do not provide this data – a significant portion of the $45 handsets skimp on Google apps just as they skimp on IMEI numbers. These devices are like dark matter: a lot of it around – but nothing really adding up to the worth. It is quite possible that iPhones generate more advertising revenue for Google than all Android phones combined. In that respect 20% iPhones sold globally are more valuable than 70% of the Androids sold.

On a slightly longer term, Android as an open platform may get leveraged across a lot of computing devices – Car consoles, TVs boxes and others without any genuine value addition to Google. Google must have to address this internal risk first!

Even when there is the threat of Amazon or Samsung forking the platform, there is also the threat that an increasing number of Android devices might have no more connection to Google than does an iPhone. That to me should be Google’s number 1 worry!

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Chronos and kairos: What drives Apple’s iWatch ambitions

Posted in Computing and Operating Systems, Device Platforms by Manas Ganguly on April 20, 2013

Apple – the formidable under Steve Jobs has fallen fast from the cutting edge technology leadership under pincer attack from the likes of Google (Car, Glass?) and Samsung (Eye Scroll, Mind Control?). The features listed here are top of mind recalls – and a careful think could provide any and many others. For the sake of the most exciting company of our times, I hope that Tim Cook has what it takes to turn it around.

Watches_4_1_610x458 The iPad Nano watch

So while Apple has been missing in action on the “Glass” kind of immersive augmented reality application – there’s some buzz and heat on the Apple iWatch. Now then, Apple already has a device which is iPod Nano watch thereby bringing Music, e-mail, iTunes, podcasts, pedometer on the wrists. So Apple’s foray into this space has a predecessor which was cool thingie on the wrist.

However, dismissing the iWatch as a watch with features is a mistake. Apple would be inclined to see this as its first foray into wearable technologies – combining the device and apps with physical activity sensors, pulse monitor, blood pressure and possibly glucose monitor. Unlike other wearable technologies like, say, headphones, these devices allow you to monitor and analyze sleep, health, and fitness levels. In short, physical states and well being.

iWatch graphic The iWatch Concept

The ancient Greeks often made a distinction between two notions of time, Chronos and Kairos. Chronos is chronological time which flows ineluctably along by seconds, hours and years, unaffected by human interests. Kairos, etymological root of “care,” is time laden with human meaning and activity. “Lunchtime,” “a good night’s sleep,” and a “long and rejuvenating walk,” all convey this sense of Kairos. A Timex is mainly chronological. What Apple could be doing is making a “kairologocial” tool that tracks and monitors the data around the experiences you care about. How much you actually slept, when and how far you walked. Basic questions rooted from everyday experience might now be by settled by data on a “watch” — a “kairometer” — rather than guesswork. Transforming the user’s experience by making impersonal things more personal and intimate has long been at the core of Apple product’s value proposition. For example, Steve Jobs positioned the iPad as a way for customers to “connect with their…content in a more intimate…way than ever before.” The Apple watch would likely build on this logic, aiming to make users’ experience of time more intimate by tying it to who they are and what they care about. That way the Apple iWatch would want too scale its effectiveness over something like the Nike Fuel Band by adding states of well being and not just fitness. Afterall, Lifestyle (iWatch posssibly!) is much bigger than just fitness (Nike Fuel Band).

Now behold the outcome of this technology

1. With iPod, Apple redefined the way people engaged with Media. With iPhone, Apple redefined the way people engaged with Internet. The iWatch experience would be key to the way people engage with their personal hygiene and habits space. Extrapolating it further – Apple disrupted Media, it disrupted Internet and now it could disrupt Lifestyle. Lifestyle is one helluva cake, pie or what ever you want to name it that Apple is after
2. And then there is the space where you connect the dots. Apps for health/lifestyle; an Interface that really goes past platforms – Phone, TV, Media and more; and a presence which is passive over long long periods of time. You wear a wrist watch for atleast 8-14 hrs of your day! And that’s a lot of data collected.
3. Apple experience has mastered the external environment – the iWatch will take it internal ( how a user reacts to a TV program, a stimulus, a news …. (that lists is endless)). Joining the dots internal and external and what a experience continuum you have created.
4. And yes, the cascading effects of a network that goes crazy about you…. Over and over again

Its really the next frontier of technology that Apple is blending with its horizons now.

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On retrospective- Was Windows8 dead on arrival?

Posted in Computing and Operating Systems by Manas Ganguly on April 18, 2013

As Microsoft twiddled and twaddle Windows’ future of computing – Android has chugged ahead and going by the drop in PC shipments (the post PC era) and increase in the number of Android tablets and smartphones coupled with Windows8’s less than lukewarm acceptance – Microsoft has a problem. A big one. To complicate things, besides Windows 8.1, Cannonical (Ubuntu), Mozila (Firefox), Google (Android/Chrome) are also making bets in the shrinking PC/laptop space. Microsoft hasn’t really fired it in the tablet space – and is yet to find a toehold in 150 million/ $64 billion Tablet industry with the Surface!

When Windows8 was being conceived it was seen as “more like a living organism, made partly from familiar bits that have evolved over the last two decades, with several new strands of DNA tossed in”. A better and a continuous experience on multiple devices was key to the rise and spread of Windows8. It was due to be updated for more often, and was a part of a much larger hardware-apps-services ecosystem that is also changing quickly.” However, if one were to refer to the numbers – Windows8 usage has been Windows Vista when compared month to month. At similar points in their roll-outs, Vista had a desktop market share of 4.52% compared to Windows 8’s share of 2.67%. Underlining just how poorly Windows 8’s adoption has gone, Vista didn’t even have the advantage of holiday season sales to boost its numbers.

Vista versus Windows8
Windows 8 usage can’t even keep up with Vista/s poor numbers.

• Thus, on a retrospective count, Windows8 Metro (refreshingly new as it were) failed to cut the ice – possibly because it was too abrupt a jump from the Windows7 Desktop UI to a “want to be a touch interface”.
The interface was great for a tablet – but then again, Microsoft is way behind Android in terms of economies of scale – and the higher pricing served as significant entry barriers.
• Volumes not coming through, key OEMs such as Samsung dropped the RT platform.
• The $500-$1200 price tags on Windows8 made it uncompetitive in an economy that’s still not moving forward quickly.
• Microsoft also did not marry its traditional UI with the Metro UI successfully enough and the unfamiliarity was daunting.

Windows8
Windows 8, and its relatives Windows Phone 8 and RT, make no impression at all in the smartphone and tablet markets.

All things put together, Microsoft doesnot seem to have moved any further with its Windows8. Microsoft is betting all its chips on the silly notion that Metro will be the one true interface for its entire PC and device line. But the numbers indicate that 8.0 hasnt really taken off. Alternatively it would have soured its relations with key OEMs who would see Microsoft’s ambitions in the device space as a threat to their own positions. Alternate OSs vieing for Microsoft’s 3rd spot in the OSs for the future is also seeing a lot of action and churn.Going back the Windows7 route is out of question – one only hopes that Microsoft is able to crack the business and user case with Windows 8.1.(Else it’s the doldrums.

Smartphones take over Feature Phones (Finally!)

Posted in Computing and Operating Systems by Manas Ganguly on March 5, 2013

Long time back, i had been musing if Smartphones could become the primary mobile/handheld devices in the future. If IDC numbers are to be believed 2013, would the year smartphones would tip over feature phones accounting for 50.1% of the total mobile phone shipments. Further more over a 5 yr period, Smartphones will clock a 10.3% CAGR making up for a CAGR loss of 3% in feature phones by 2017, thereby growing the mobile phones category by 4%.

IDC Smartphones pip Featurphones 2013

The three key reasons of rapid massification of smartphones are
1. Data centric network roll outs (3G/4G)
2. Drop in Entry cost from $600 (2009) – $50
3. Open source eco-system that are pushing the economies of scale.

As Smartphone breaks price barriers, the distribution and reach is reaching hitherto untouched segments and economies such as India, Brazil, South Africa, China, Indonesia. China has already topped USA as the top smartphone seller globally. the tablet below summarized IDC’s growth matrix for Smartphones on a global basis.

Top 5 Countries Smartphone Shipments

Now then to my favourite old question – A 70% Android share- Is that a tenable proposition even as the competition keeps increasing? Or do we see a new world order in Smartphone OS 5 yrs down the line? Or will Android become to Smartphone what Windows became to PCs?

Platform extension may be the pointer and the answer to this.

Another compelling thought – Will Smartphones give way to a more real time immersible experience such as Augmented Reality on Glasses or Contacts?

Is there room for more than 3 OSs in Mobile?

Posted in Computing and Operating Systems by Manas Ganguly on February 27, 2013

Gary Kovacs, CEO Mozilla wants a piece of the action in enabling the next 2 billion people graduate to the internet. Thus the Firefox OS. Over the last couple of weeks there have been increasing number of claims to divergence in the Mobile OS space- Blackberry 10, Tizen, Ubuntu and now Mozilla. Additionally Samsung is shutting off Bada and HP is selling off WebOS (to LG).

Mobile OS logos

1. Android being the 70% market leader is working on economies of scale and scope – spreading the open platform across multiple domains – TV, Project Glass, Set Top Boxes, Refridgerators, Cars and more. Thus Android is emerging as the truly “connected OS” in the age of convergence
2. Apple still rules as the king of experience and if the experiments in India are replicated across emerging nations – and if the low cost iPhone is in works – Apple will multiply its market share in the mid range ($200) segment in the emerging nations.
3. Historically, OSs have largely oligopolistic/monopolistic in nature. Windows has ruled the PC wave and Android/iOS share the spoils in Mobile devices (Smartphones and Tablets). Even in the feature phone category – Symbian ruled the roost before the advent of Smartphones.
4.While the promise of a diversified OS experience and OS fatigue is a promised land – most of the experiments in this field have returned without encouraging results. (The Palm and HP experience with WebOS and the Samsung experience with home grown Bada being key examples)
5. Even a Goliath like Microsoft is unable to turn the RT platform with a reasonably decent Windows8 experience. Currently all it has is just a toe-hold in the industry even with a Office monopoly out there.
6. Operators – the key market facing entities in the telecom eco-system support the concept of multi OS but the consumer ask is converging to 2 or maximum of 3 OSs. Apple, Android and Blackberry/Windows take those spaces.
7. OEMs and Developers on the other hand would like to be working on 2/3 OSs – OEMs get their economies of scale and Developers have lesser customization requirements for their apps (Agree that HTML5 may change a bit of this)

There’s yet another promise of a light OS with cloud support supported by HTML5 – but even that experience is far from mainstream currently. Many of the fledgeling OSs plan to ride the HTMl5 wave. However, HTML5 and its features are also key to Android and Apple’s iOS – all the more relevant with over 600K apps each.

All these factors put together- my feeling is that there isn’t much room for multi-OS play. I had love to be proven wrong such as the way Windows explorer ceded the browser space to Chrome, Safari and Mozilla.

So to answer Mr.Kovacs narrative – “Apple and Google have led the way in the smartphone market but can’t cover the whole thing- it (is) impossible to understand how 3, 4, 5, or 6 billion people are going to get their diverse needs satisfied by one or two or five companies, no matter how delicious those companies are… Is the farmer in the Indian countryside going to have the same needs and requirements as a lawyer sitting in New York?

Yes, Mr.Kovacs- there is very limited need divergence in the age of convergence- and then there is scale!

Android – Google’s best strategic move ever?

Posted in Computing and Operating Systems, Mobile Computing by Manas Ganguly on February 11, 2013

Android controls 70% of the Smartphone volumes in 2012. Over the last 4 years, ever since Google launched Android, this has been one huge success story. In this post, i am looking at the 3 factors that have fueled the Android’s success story. The success generated by Android is across three key levels – Present day revenues for Google,Access to mobility for Google and generating intelligence and information about the user – creating profile and semantic patterns which is the future of advertising as we know it.

android 15022013

While Google’s intent behind Android was such that it was not completely shut out of the mobile Internet by a dominant OS provider. The initial fears were around the dominance of Microsoft which in the post 2007-iPhone era came to be Apple. However, it just did better – it went on to become the dominant OS in Mobiles and handhelds itself.

We all know that Google makes almost all of its money on ad revenue – 94% of Google Q4 revenues were based on advertising. Of this $8bn was generated by mobile devices of which, analysts now expect $5bn of 2013 Google Ad revenue to be from tablets alone! That makes it seem like a pretty solid investment for Google to pay whatever it does to be the default search engine in iOS ($1 billion/annual), since the iPad still holds close to half of tablet sales.

Android is Google’s footprint on mobile- An Android device, properly signed into a Google account and running all the Google Apps, generates an endless stream of little bits of ‘signalling’ information, way beyond what Google gets from a desktop search user even if they’re using Chrome. It knows where the user lives and works, how he commutes – and which phone numbers on web ads he dials. All interactions with Search, Maps and anything else can be linked together. Android, allows Google to tie searches and advertising to individual people and places. In the long term, the data that Google gets from Android users is probably just as important as Pagerank in understanding intent and relevance in search. The real structural benefit to Google from Android now comes from the understanding it gives of actual users, and the threat comes from devices that do not provide this data.

It is quite possible that even Google didnot see the scale of success of Android – Not only did it mark Google’s entry on mobiles, it also is generating revenue and most valuable user information.

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