Why the big Android bandwagon?

Why the big Android bandwagon?

Summary: Google's cost structure gives it the power to be patient, something no other market player has. The Android bandwagon is built on this patience.

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TOPICS: Open Source, Google
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We have had open source mobile platforms for years. Why has Android become a bandwagon, one big enough that people are wondering if it's not growing too big for its britches.

One word: marketing.

Thanks to its low-cost structure, Google can subsidize the marketing of its products to a degree even experienced rivals can't match. As I have said before there is a price lower than free, and Google is uniquely positioned to pay that price.

Why? Look at the ad above, for the HTC myTouch, from Vimeo. All those celebrities aren't just selling T-Mobile, or HTC. They are also selling Google. Android gave Google an excuse to do TV ads, with others' help. Even if it doesn't sell phones it sells the Google brand, and Google benefits from that.

It's all about the sharing. By spreading the development effort through open source, Google also spreads the marketing cost as various players vie for position. But Google's size and budget are what make this a good deal for everyone else.

Symbian and RIM can't pay this price to the degree Google can. Symbian was spun-out to become self-sustaining, and its developer outreach efforts may be all it can do. RIM has a proprietary background, and proprietary profits, so for it to grab open source may easily be seen as desperation.

Google has both the money and the reputation to push product through the channel that has its roots in open source. Its multiplicity of developers means all of them have an incentive to drive down the open source incline and the open source development incline.

Google may eventually seek to monetize all this with online services, but it is developing the market before showing its hand in that area. Meanwhile, the ad revenue from having Web pages appear on more mobile kit is all it really needs. (Yes, this means the iPhone is subsidizing Android.)

Google's cost structure gives it the power to be patient, something no other market player has. The Android bandwagon is built on this patience.

To succeed, however, it will have to deliver products as good or better than the iPhone, at the same or less cost, with just as many apps. That risk to its reputation is all Google is laying on the line here, but since failure will also hurt open source that risk is also shared.

Topics: Open Source, Google

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24 comments
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  • One minor nit to pick

    <i>To succeed, however, it will have to deliver products as good or better than the iPhone, at the same or less cost, with just as many apps.</i>

    It needs just as many <u>good</u> apps. It doesn't need all the flashlights or fart apps or things like that. It doesn't need two dozen different office apps. It just needs enough good apps of all types to create good competition within and enough to compete with the other cell phone offerings.
    Michael Kelly
    • Actually, Android needs just as many apps.

      Because you will get the same number of flashlight, fart apps and office
      apps.

      It is a wonderful myth that people make up to feel better about the
      success of the App store. That all the of those 85,000 apps are
      worthless cr@p. But I am sure it makes people feel better and sleep
      better.
      Bruizer
      • I wonder who actually has trouble sleeping?

        You can marginalize all you wish, but I wonder if people like you make up these myths (that nonsense apps are the minority) to help you sleep better at night yourself.

        Interesting to note that out of all the people I personally know who do have the iPhone or iPod touch, they all have the "iFart" application, and games, and some other less serious, "what is the purpose?" applications.

        Only two have a couple of actuall usefull applications, so you are correct, without the useless fart applications or simple games, the Android store will not be anywhere near as large as the App Store if all they do is cater to those looking for everyday usefull applications.

        Sleep well ;)
        GuidingLight
        • Windows Mobile Worshipers.

          Mostly. Android will do just fine.

          BTW: I take it you have never looked at the App Store have you?
          Otherwise, you would know there are 10s of 1,000's of useful apps in
          there.

          Guess you are just to afraid to actually look.
          Bruizer
        • Sounds like you are already asleep

          It says more about you and your friends that they all have iFart and other useless apps on their iPhones.

          I don't, and nobody I know does. Silly us, not using the iPhone to waste time, but rather to help us in what we do.
          jorjitop
        • iPhone Apps..

          Guiding, you obviously never checked what is available in
          iPhone App Store. Check out this link, it is a new search
          engine just for the App Store. Type any word that pops
          in your head, see what's available:

          http://www.uquery.com/
          prof123
    • Android doesn't need any apps to be successful

      It's the chicken and egg again. The iPhone was successful for over a year without any 3rd party apps. It was a compelling device right out-of-the-box. Developers wouldn't have signed on if it didn't already have a large user base.

      Android (or any device-specific derivative) needs to be compelling out-of-the-box to be successful. People will buy it "as-is", then the developers will come. Google shouldn't depend on them for success, at least not yet.
      rynning
  • because...

    Android will extend from phones to the desktop and will replace windoze.
    Linux Geek
    • No it won't

      If anything, the phone will replace the desktop, thus relegating Windows to be the champion of a niche product.

      The desktop won't ever die, but it will become less important to daily computing as time goes on.
      Michael Kelly
      • Don't count Microsoft out

        If their recent string of successes are any indication of the kind of product we should expect from Windows Mobile 7, Microsoft should be regarded as a very serious competitor.

        Microsoft is very aware of the importance of the smartphone market and is not going to go down without a fight.

        If apps are what count, Microsoft has plenty of experience creating a thriving software ecosystem.

        If branding is what counts, Microsoft's brand is the strongest it's been in nearly a decade and gaining consumer enthusiasm by the day!

        If market share is what counts, Microsoft is no stranger to being king or underdog. They know how to sustain growth or maintain dominance.

        You're all quick to write Microsoft off, but they haven't shown their hand yet. We'll see what happens when they do.
        ericesque
        • Nice MS promo but...

          ...what string of successes? And have you not noticed that even Ballmer is saying that MS never recovered from the Vista fiasco? How then would Microsoft's brand be the strongest its been in a decade?

          Sorry but all the MS promo material in the world does not change reality. The issue here is that Android for a handset maker is basically free and gives them the tools to compete with Apple. MS even if they get WinMo up to this point in terms of UI and ease of use they aren't going to give it away. They face the same problem now in the mobile space that they do in the netbook space. They are trying to kill the idea of a netbook or force a non traditional desktop like Moblin to take the lead. But they can't kill the smartphone and there is not such thing as a traditional UI in that space. They will have to actually provide features worth the cost of building phones on that platform to compete and their track record on competing with actual quality has been shabby at best. I don't think theres much to wait and see on the MS front.
          storm14k
          • now some reason and logic

            Everyone knows that Microsoft took a beating for Vista. That's old news. The fact that Ballmer is finally ready to admit it publicly only means that his statement can no longer do real harm to Microsoft's image.

            Microsoft has proven in multiple markets that "free" isn't the issue. To say that gives Android the edge is historically inaccurate.

            Microsoft ISN'T trying to kill the netbook. The notion is absurd. They have a SKU for Windows 7 dedicated to the netbook! Additionally, inexpensive Windows-based computers for everyone is the core of their advertising mantra. Aside from attempting to rename the segment, what has Microsoft done to "kill the netbook"?

            Of course they have to provide features worth the cost of building phones. Every player does!

            "Their track record on competing with actual quality has been shabby at best." Is that to say that OSX is not quality OS?

            "I don't think theres much to wait and see on the MS front." I wouldn't expect you to. Microsoft could offer you a million dollar check and you'd whine about the penmanship of the signature.
            ericesque
          • Nice MS promo but...

            I wouldn't waste much time arguing with MS fanatics. They have it in their head that MS is king and will never be dethroned. History proves that no company or empire stays on top and in the lead, or lasts forever.
            Personally I don't really care if they remain one of the largest players in the world of IT, but it should be based on fair competition, something that they have a history of having a hard time doing.
            mrdt
          • Actually...

            I hope that Android is successful. I think it's going to bring smartphone-like features and apps to all cell phone price points-- something I'd be a very big fan of.

            Please note I never said that Windows Mobile will be better or even sell better than Android. It's just that none of you know what you're talking about. Your reasoning is flawed and I like to correct you as best I can in the limited forum we share.
            ericesque
        • Too little, too late

          Windows Mobile 6.5 just came out and it was a relative dud. 7 may not come out for another year. Even if 7 does have features considered innovative for late 2010, it will have lost a lot of momentum while iPhone and Android will have gained more. And let's not forget that any installation of Windows, no matter what the platform, automatically adds a significant licensing cost to the hardware, whereas Android installations only need to worry about R&D.

          And let's also not forget that the major reason Windows has its firm grasp in the desktop market because it has a firm grip on the desktop application market. It has no such claim on the smart phone market.
          Michael Kelly
          • WinMo 7 will be free

            Since MS makes so much more money off secondary sales from each WinMo license, they will have to make WinMo 7 free. Either that or start making it's own hardware and throw its partners under the bus like they did with media players.

            In other words, they need to either be like Apple/RIM or be like Google. I'm guessing they'll be like Google, since their last try at being like Apple was such a failure.

            I'm actually surprised they didn't make 6.5 free, but Balmer is a little slow. By the time 7 comes out, Balmer will be gone and MS will start making smart decisions which will finally make it relevant again.
            rynning
          • But will WinMo 8 and 9 be free?

            See, unless they release the source (and that won't happen) there is no guarantee that it will remain free. And I think people understand that enough to not fall for any gimmick.

            And seriously, if all they wanted to do is make secondary sales, why not hijack Android? That would make far more sense.
            Michael Kelly
          • "Hijack"?

            By "free" of course I mean free to device makers.

            What do you mean by "hijack Android"? Do you mean take Android, add value-added components for Exchange, Office, and connectivity, then give that away? That sounds a lot cheaper than supporting a mobile OS, so I agree it would make a lot of sense. Unfortunately, I don't see MS (i.e. Balmer) exiting the mobile OS market...
            rynning
        • Don't count Microsoft out

          Microsoft will loose because of DRM,
          TheCableGuyNY
        • MS mobile sucks...

          They have been at it for at least 10 years and have done
          pretty crappy stuff. Along comes Apple with the iPhone
          and shows them how it is supposed to be done. I think
          this time around, MS will be a minor player... iPhone and
          Android will rule...
          prof123