Android vs. Google Part II

AppleInsider | First AT&T phone with Google Android will feature Yahoo search

As the Backflip will mark the first time U.S. customers under contract with AT&T will have the option to choose between Android and the iPhone, every Motorola Backflip that AT&T sells might potentially be at the expense of an iPhone.

That Backflip sold will not generate Google any ad revenue since it will offer Yahoo/Microsoft search exclusively. Nor will the Backflip generate any license revenue for Google, because Android is licensed without a fee.

If that buyer would instead have bought an iPhone, the search from mobile Safari would have some non-zero value.

It is therefore pretty obvious that, at least in this instance, Android is destroying value for Google.

See also:

Android vs. Google (part I)

  • Nor will the Backflip generate any license revenue for Google, because Android is licensed without a fee.

    That may not be true, actually. A lot of the applications that come standard with Android are Google's proprietary applications, so unless AT&T is including special substitutes for them, then they may actually be paying Google licensing fees.

    My understanding from the Cyanogen cease-and-desist fiasco is that even though Android is technically open source, a lot of the core functionality is built on Google proprietary apps (and to get Android fully functioning, you'd have to create your own substitutes for those apps).

    Of course, some of the proprietary apps are not for core functionality but would still be useful for phone owners (the YouTube app, for example), especially since Adobe hasn't released Flash for Android yet (except the lite one for the Hero).

  • I would be very surprised if Google charges licenses for core applications. But even if they, the point is Android vs. Google. If Google wanted to license its apps it could (as it already does) license on existing operating systems.

    Google Maps is a great client for Symbian and for iPhone.

    The question remains: what is the economic value of *Android* to Google? Why does Google need a mobile operating system independent of a set of apps? Especially one which is open sourced.

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  • DR Olson

    It seems to me that the primary point of Android and Chrome was to protect Google from being locked out of ad revenue by Microsoft effectively switching search on its Installed base to Bing.

    In a similar way that the influence and market share of Internet Explorer has been impacted by webkit, an open source search engine could greatly cut Google's ad revenue. Google's actions and plans may motivate some to support such an open web search engine. Google's predicament at that point would be much worse than Microsoft's at this point.

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