The Google Phone: The Story So Far, Some Launch Details & What's Next

40 Comments

The Wall Street Journal has been reporting on Google’s mobile phone efforts and how it is beginning to draw some interest from carriers, especially in the United States. Sprint (S) and Verizon (VZ) are in talks with Google (GOOG), according to the Journal, and an announcement by the company is expected sometime in November. Here is what I have been able to gather from my sources:

* An announcement will likely be made Nov. 13th or Nov. 18th.
* Handset makers will use a Google Mobile OS platform.
* Google Mobile OS uses a highly optimized Mobile Linux; developers will be able to use a Java Development Kit. Google is said to have developed a highly optimized Java running on top of the OS. (Read our previous post, Five Facts about Google Phone.)
* Most major handset makers, with the exception of Nokia (NOK), have devices with Google Mobile OS under development; Samsung and Motorola (MOT) are being linked to it as well. (as are HTC and LG Electronics, according to the Journal.)
* The operators who are likely to be part of the big announcement will be T-Mobile’s USA division and Bharti Airtel, one of India’s largest cellular carriers. [digg=http://digg.com/gadgets/The_Google_Phone_The_Story_So_Far_and_What_s_Next]

The increased interest on the part of mobile carriers is summed up best by Hamid Akhavan, CEO of T-Mobile International and CTO of Deutsche Telecom (DT). In a chat with Russell Reynolds Associates he said:

These companies have recognized that it is not an easy game to penetrate the wireless market without the help of the operators, which has led to collaborative relationships…The biggest challenge is to adapt our market perspective and business model to one based on partnerships, content and applications. Historically, wireless carriers had a relatively simple business model — end-to-end voice service — with correspondingly simple billing. That is no longer the case.

Carriers are grappling with this question, and this business model conflict is something that needs to be resolved quickly by Google. Akhavan points out…

When AT&T and Apple partner on the iPhone or T-Mobile partners with Google on mobile advertising, these new arrangements force the question: “Who pays whom and when?” Billing, payment and content management for broadcast, advertising, search and music all are significantly different. Carriers are having to develop new business models that are compatible with the changing business models of the other key players in the ecosystem. The business models have to be as interoperable as the technologies.

After talking extensively to the mobile industry insiders, I believe Google Mobile OS is going to become part of the new mobile ecosystem. More on that later tonight, once I get a chance to sit and write.

Related Posts:

* Who’s afraid of Apple and Google? Not Symbian
* Five Facts about Google Phone
* Forget iPhone, think Google Phone

40 Comments

Kite

Jam i agree with you i dont know how much of a success that this will be bercuse its their first time making a phone and they probably dont know what they are doing so for anyone who wants a google phone i would think about it

Jam

I’m not sure I am trusting google to make an OS, what experience do they have in this department? None really…

Besides, the iphone is going to be open source already and you can get on google which is all I really care about, it’s OS is already proven and the MAC OS is probably better than anything Google could come up with.

Shakir Razak

Hi,

What does Google bring to the party?
What is its unique proposition?

It seems a way to get a free OS with wider distribution than the many existing rolled Linux flavours.

Just like Microsoft with the PC, or recently with Open Social, Google gets access to the important stuff, and it’s “partners” are eventually left as no more than its bitches.

Everything else, including search, advertising, profit-share, direct sales, multi-distribution, fixed-cost, et al, can ALL be done right NOW, google doesn’t have the all important content, and the telco infrastructure companies are the ones with the real technical tool deployment abilities.

It all just seems very lazy, stupid and short-sighted.

Yours kindly,

Shakir Razak.

Tejas

Without knowing the features and capabilities, it is hard to gauge how appealing this is. Is this about replacing the carrier’s walled garden with Google’s walled garden? If so, this is a flawed idea.

From a device ASP point of view, if this is offered on devices under $200, it has a good chance of success, otherwise it’ll be a niche, similar to iPhone.

Lastly, if there is a strong expectation of users using data services (non SMS), then the US market is absolutely key for success. T-Mobile US is not a leader for that. VZ, Sprint, and ATT are better. As the link below indicates, the US market leads in adoption of data.
http://www.fiercewireless.com/story/report-u-s-subs-have-highest-data-arpu/2007-10-22

Regarding the Indian market, I agree that a lot of high disposable income metro users are very open to using new VAS services. Also, they are not shy about spending a lot on handsets. However, the service revenues (ARPU) is nowhere close to the US level ($8 vs. $50). The US market being 3-4 years behind is a gross exaggeration and is actually a wrong statement.

HSDPA network has been live here for some time. How many European countries have that? When will India get it?

10M+ users in the US routinely pay $40+ for unlimited data plans to get their BB email. How many users in India do that?

SMS usage in the US is now getting close to that of the UK, so US no longer lags there as it used to.

All consumer services are going strong here – ringtones, games, American Idol, etc.

The big mobile opportunity in India is still the massive volume of users.

Brian

@ hipshott – i agree with you but the web has shown us that people dont care about personal privacy – especially around free products. For example, most people who use Gmail do not read the terms of service on it and see how invasive it is. That is what will happen with any phone and/or infrastructure play that Goog tries to put out. People will tolerate it based on the notion of free – of course, in the end the market always speaks so it should be interesting to watch.

PS: I think your point is a great one on Googs actual conversion rates and the need for more scrutiny.

Omar Nawaz

It certianly is another nail in the Walled Garden Coffin. I am happy about. My concern is Google will end up creating a deal with Operators similar to Microsoft and other OS vendors. At the end of the day, if Google’s objective is the drive more ad-based revenue that I don’t see this of any more value than any other large corporation initiative.

MobileBeliever

The original reports said it will have

1) GPS
2) 3G and WiFi

any word if this is still going to happen?

Karim Baz

I love it. I bought the iPhone lately but a proper UI and OS on a “regular” phone will have me selling my iPhone in a heartbeat. Go Google.

— Karim Baz

hipshott

Brian…. what customer would sign up for that. I dont want my ph vibrating every 20 sec with offers. Its already receiving 200 emails a day and a 20-50 calls. Goog has to do this right or consumers will backlash.
By the way when was the last time someone actually clicked on a google ad….Goog is generating revenue from selling ads, but who is making money from the ads placed? I think once people get over their dreamy gazing at GOOG share price and look at conversion rates they will wake up and realize that they not getting the ROI needed to support making GOOG worth 200B+.
Demographic advertisingis dead, its all about pyschographic profiling will Open Social and mobile google help that?

MK

So as you drive and talk to your friend >about chinese food, cars, socks or >whatever, they find every business on your >route and text you continuously – or, they >may even call you on behalf of the >business. Point advertising at its finest. >What business would not sign up for that?

More importantly, what consumer WOULD sign up for that? Even if a monthly plan was free, such intrusiveness would not appeal to many.

v-gudmk

This system of carrier/phone maker partnerships is completely corrupt and anti-competitive. It should be illegal. Why can’t I buy a google or iphone and use it with any carrier I want? Does anyone buy a PC just for comcast, or a laptop that only works with Verizon DSL?
This will become clear to everyone soon when the new phones are just mini personal computers, even running the same operating systems as PCs (Linux for example).

Brian

I cant wait for this. Just when i am talking to a friend about chinese food i had for dinner last night, Google will text me an ad for a chinese buffet i just past while i was driving.

How? Well, under their terms of service which no one will read but will blindly sign, you will agree that they can track your phone with GPS technology and listen to your calls. So as you drive and talk to your friend about chinese food, cars, socks or whatever, they find every business on your route and text you continuously – or, they may even call you on behalf of the business. Point advertising at its finest. What business would not sign up for that?

Vivek

@ Amit

I am a little hesitant to believe that we are 3-4 years behind. People in USA have near broadband speeds on their mobile phones. Especially the CDMA users. In India CDMA market is still playing a catch up as far as I know. There was a huge hype when reliance launced their phones where ads described it as a portable TV and so on. But the reality is that most of the users , use only voice and texting.

Yes some people do buy phones for 10,000 or more. But how many of these represent the masses? More importantly, how many of them are willing to buy another phone in the near future?

Could you care to educate me on what mobile banking can be done via a mobile phone in India?

@ Omfut

Oh yes? As far as i see, the only technologies that have been adopted by Indians on their mobile are Voice , texting, very less internet usage and…?

I am not an industry expert to follow the indian mobile market closely. BUt as an end user, I am aware of the offerings and their limitations.

Just buying a phone for Orkut would be a huge overstatement.

If I am wrong somewhere, please let me know. It is nice to have such discussions :)

Niraj J

So how is the conflict of interest situation with Eric Schmidth going to be resolved. Eric sits on the AAPL board and GOOG has a product in direct competition with AAPL

omfut

@vivek:
Not sure if u follow indian mobile market. Indian mobile market is faster in adapting to new wireless technology than USA. Way back, I was surprised to see indian operators talk about sms 2.0 and mobile TV, when operators here were just thinking about it.
Google Phone make more sense in india from orkut angle. India has second largest user base on Orkut. Some kind of mobile and web convergence makes perfect sense.

Libran Lover

Anyone willing to bet that the GPhone negotiations between Google and Verizon had something to do with why Verizon decided to backdown from the fight against openness on the 700 MHz spectrum?

Libran Lover

Second Amit’s comments. Indians are far more likely to spend real money (compared to their pay scales and living costs) than Americans for phones with great features.

Also, ads are supposed to subsidize the cost of the phones and the data connections. This is another plus to encourage Indians.

Finally, Google is very unlikely to present ads at the cost of acceptable user experience, let alone at the cost of user’s cash or time.

When you think of a data-enabled smartphone, think of a tiny computer with an Internet connection in your hand every place go. There is no way such a device is limited to “say a road search or the like”!

FPB

I’ve no idea what this is all about.But i would appreciate just 12 of you americans checking out my fascinating postings before midnight GMT so that i can achieve my highest ever monthly visitor hits EVER!
thank you america
fpb
http://www.pastapaulie.wordpress.com

Amit Jain

To respond to Vivek’s comment, US is 3-4 years behind India in mobile technology. Mobile is being used for lot of things other than calling and texting in India. And in India people do buy a phone of 10000 – 20000 INR, unlike US Cutomers who keep on waiting for a free phone. Mobile banking is now a days very common.

Vivek

for the end customer who has heard a lot about the iphone , this would be a welcome news.

The google phone also makes sense for mature markets where a lot can be accomplished from a mobile. Further these markets have the infrastructure in place to allow mobile internet access – a must for google phone.

Seeing airtel in the article does not make sense to me atleast. Even if google phone is launched in india by LG or whomever, how many people have GPRS or edge on their mobiles to enable them access these features? Further more how much of content is available for them to use say a road search or the like? also why would someone buy this phone in india? In US, such phones would be almost free with a contract.

If google plans to be consumer friendly , then i would welcome the technology aspect behind this initiative.

But if google wants to advertise on our phone at our cost and time, i would rather use my existing mobile – “no thank you google”

Thanks to Om for the details in the post. It is interesting to watch technology updates.

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