Googling Google

Christopher Dawson, Sam Diaz and Matt Weinberger

Google plans to make $10 billion per year from Android

By Garett Rogers | July 29, 2010, 9:18pm PDT

Android is free for device makers to use on their devices — Google doesn’t make a cent on the operating system itself. It’s an interesting model that hasn’t yet translated into money, but it has certainly translated into a ton of devices and end users.

Google is activating 160,000 Android devices per day — whoa! That’s an enormous number (that is accelerating). Imagine Google with a billion end users of their Android operating system — something that can’t be far from 5 years out given the current growth and acceleration. Eric Schmidt concludes that with that many users, all you’d have to do is make $10 per user per year — and that isn’t out of reach.

With that kind of user base, $10 billion per year isn’t a stretch, given AdMob advertisements and app sales.

Windows Mobile 7 has potential too though. Even though it’s not free, I can see the device being popular for end users based on some of the hands-on reviews you can find online. The operating system looks really great, and even though it’s going to cost device makers money to use, I can see it being a popular choice for consumers.

Kick off your day with ZDNet's daily e-mail newsletter. It's the freshest tech news and opinion, served hot. Get it.

More from “Googling Google”

Google WiFi snooping: Company cleared by UK watchdog

Google search blocked in China? The pain continues

Topics

Google Inc., Android, Garett Rogers

Garett Rogers has always had a deep interest in computers and the Internet, which led him to a degree in Computer Information Systems. He is currently employed as a programmer for iQmetrix.

Full Bio
Disclosure
Contact

Vendor HotSpot

Here to help you with your Document Management Needs

Read the DocuMentor blog now

Learn More »

Talkback Most Recent of 15 Talkback(s)

Follow via:: RSS; Email Alert

Not sure how google make money from a free os

People don't need service support for a cell phone. If there is an issue, google has to fix it -- for free.
FADS_z
29th Jul 2010
- Reply to
- Flag
Have you never heard of the term "Data Mining"?

@FADS_z

When you choose to use Google, whether it be their search engine, free apps, Android, or Chrome, you are basically selling your soul for a few baubles. Personally, I would rather pay for my baubles and keep my soul.
itpro_z
29th Jul 2010
- Reply to
- Flag
@FADSz

@FADS_z How? The same way Google is making money with Google Search which we all use for free, with Google Ads.
jack of daniels
30th Jul 2010
- Reply to
- Flag
Go, Android!

I hope that Android becomes really, REALLY big with the general public--as all the Fandroids are predicting. I'm talkin' megaHUGE! I can't think of a better way for the shortcomings of "open" to become apparent than for that to happen.

Until now, "open" has been the domain of geeks and some enterprises that are administered by IT pros. For all the efforts of "open" proponents, it has never made it big time with the general public. But as it becomes more and more used (ala Android), its weak spots will become sore-thumb obvious. You already hear rumblings starting about the Android Market: 1) the overall quality of the apps isn't very good, 2) security nasties are beginning to sneak in, 3) it's difficult to attract premiere app developers because of the large number of freebies that are available, and 4) the configuration/fragmentation nightmare.

People point to Google as a shining example of "open". The ONLY reason Google hands out all their free, "open" goodies is to entice people into their data cloud where they extract the personal information they need to sustain their ad business--and make BIG bucks! As for being "open", can someone tell me how easy it is for John Q. Programmer to modify Android code? Or G-Mail code? Or Google Voice code?

Right now, "open" is pretty much like the old wild, wild West. Everybody is running in different directions doing their own thing. As it becomes more generally used, some "law" will be required to keep it from getting completely out of hand. Here's my prediction: As "open" becomes more and more popular, it will become less and less "open".
Userama
29th Jul 2010
- Reply to
- Flag
The OS cost is passed on, the oem doesn't eat it

Think about it. apple makes iphones for $200 and sells them to ATT for $600 so ATT has to subsidize $400 out of your plan. htc, lg, samsung, etc can make the same phone with OS license and typical consumer electronics markup for about $200. That could be the unlocked price! a carrier could give them away for free and still be subsidizing only half what ATT does for an iphone. or charge $200 and subsidize nothing. This is what the market should drive to to get volume. The only loser is apple...
Johnny Vegas
29th Jul 2010
- Reply to
- Flag
RE: Google plans to make $10 billion per year from Android

@Johnny Vegas: yeah, Apple is loosing big-time selling 3-4 mil devices every month on a ridiculous gross margin. AND, not to mention, by having the highest customer base loyalty in the industry. I gotta get some Apple stock...
dsalageanu
3rd Aug 2010
- Reply to
- Flag
RE: Google plans to make $10 billion per year from Android

@dsalageanu The bubble will burst soon, pretty soon Apple devices will be so obsolete and the fan boys will either kill themselves, or give up its just a matter of time. :P
topgun966
6th Aug 2010
- Flag
1 billion Linux Java users

So in essence, 1 billion Linux, Java and OpenGL users?
And hundreds of thousands/millions of Eclipse based developers?

You talk about Android, but an Android phone is 90% APIs that are cross platform and 10% Android specific APIs.

And the GUI on them is not usually Googles, it's HTCs or Ericssons.

And any handset maker can grab the same, Linux, Eclipse, Java, OpenGL, Webkit based browser, stick their GUI on it, e.g. HTC Sense, add their phone's hardware drivers (which is really what drives Android API) and there you have a new phone platform that apps can port to as easily as any other.

Meego, Bada, Android, RinkyDinky101....
guihombre
30th Jul 2010
- Reply to
- Flag
RE: Google plans to make $10 billion per year from Android

That makes a billion people being spied on by Google. Google's business model is based on spying on their users. Unlike Apple, Microsoft, and others that actually make money by selling you hardware and software.

To think, George Orwell worried about governments. Google will be far more dangerous.
jorjitop
30th Jul 2010
- Reply to
- Flag
Ummm

@jorjitop "...To think, George Orwell worried about governments. Google will be far more dangerous. "

Who says the two entities are working autonomously?

No offense, but you seriously need to guard against naivety.
thx-1138_@...
2nd Aug 2010
- Reply to
- Flag
RE: Google plans to make $10 billion per year from Android

@jorjitop you really think that every major corp out there doesn't get you're info? Oddly enough MSFT is really the best out there at not going so heavly after it. MSFT's bread and butter is govt and corp users not the end users. Apple is by far the worst offender. You HAVE to enter ALL your info into itunes including a CC before you can even use the phone. Google, you don't need to enter any personal data if you don't want to. You can make a gmail account and just name it idontwannagiveittoyou and leave it at that. You sound very naive my friend.
topgun966
6th Aug 2010
- Reply to
- Flag
Android Downloads

Can someone give me some sites for the droid apps for me to download. I know in a 2 places I fould they have free or paid. If you know of a few places can you help me and let me know.
Thanks
Harry
carmanhere
30th Jul 2010
- Reply to
- Flag
RE: Google plans to make $10 billion per year from Android

Garret, this is bad post. No new facts, just old speculation and little or no analysis. And you end up talking of MSFT and again no new content there.
tassaramar
30th Jul 2010
- Reply to
- Flag
Everyone of you who says Google spies, raise your hands

Okay, everyone of you who says Google spies, raise your hands. Now, I want you to be honest with yourselves and be true to your paranoia - I want you to all go and close your Facebook accounts. Zuckerberg has already identified you as dumb f***s. tinyurl.com/37neb8e
freetulisten
30th Jul 2010
- Reply to
- Flag
Not so impressive...

...considering that Apple already makes $10 billion / year on the iPhone, by promoting a ridiculously closed system and holding all cards at any given time, against everything that logic taught us. THAT is truly remarkable.
dsalageanu
3rd Aug 2010
- Reply to
- Flag