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Google as Android "Vendor"

In a recent tally of mobile OS market share estimates from Canalys, the market was organized by OS vendors. The number of devices sold by operating system vendor includes as many OS’s as each vendor may supply.

For example, Microsoft licensed two different OS’s during the period: Windows Mobile 6.5 and Windows Phone 7. Nokia also offered multiple versions of Symbian, which have varying degrees of inter-operability.

Google’s offerings include (as per footnote) OMS and Tapas platforms in addition to Android.

Fragmentation is not a new subject as OS licensing models have been ripe with it for as long as they existed.

What I want to draw attention to is the concept of Google as “vendor.”

A vendor in the traditional supply chain model is a supplier that sells to an up-stream value-adding stage of the value chain. The word itself has as its root the word “vend” which means to sell.

But we know Google does not sell Android. And it’s not just that Google builds a product and ships it for free.

There are no contracts associated with the transaction of downloading the Android source. No contract means no obligations, no warranties, no terms and no conditions. The product is not indemnified against litigation. There are no licenses, no support, no copyrights and no patent license granted.

The contract-less nature of Android makes it easy to distribute. It’s one of the key reasons why distribution can grow at 600% a year–there is no distribution in the classic sense. The real disruptive advantage for Android lies in the removal of distribution costs (not just development costs). Google themselves admit that they have no idea who implements the software and how it’s used.

Which makes the classification of Google as a “vendor” a misnomer. The notion of ‘vending’ something implies a contract. What Google does is write code and place it on an FTP server.

It’s a wonderful way to save on SG&A (there is no sales, general or administrative expense.) But as everyone knows, there is no such thing as a free lunch.

By avoiding any contractual engagement with the authors of the source code, implementors are subject to independent litigation for IP violations. This is why HTC and Motorola are targets for Apple and not Google.  Google is no more liable for writing Android than the author of a book on bomb making is liable for the bombs put into use [1].

Patent violation rests with implementation, not the writing of the idea itself.

Furthermore, Google cannot ensure Android users have any specific experience. They can’t encourage upgrades, service models or any form of common UI. The experience, like the protection of property is the responsibility of the implementor.

Can Google change this approach with Android? Not as long as Android is open source. Can Google change Android from being open source? No, they don’t own the source to Android. Nobody does.

Notes:

  1. If the bomb making book was a copy of another, then the author is liable, which is the case being made by Oracle.
  • AlStu

    "No, they don’t own the source to Android. Nobody does."

    This is incorrect, Android is not public domain. Code still has copyright attributed to whoever wrote it, licensing is a different matter entirely.

    I can distribute code under an open source license without relinquishing my ownership of it.

    • Steven Noyes

      Which is the core issue in the Oracle VS Google case.

  • http://boswellip.com/ Mason Boswell

    The above is not a strictly correct statement of patent law. Google could be liable for simply putting code on an FTP server if that code violates patents. Who is the infringer depends on how the claims of the patents are written. As an example, consider three popular types of software patent claims: method claims, system claims, and computer-readable medium (CRM) claims. A method claim claims steps of a method (e.g., receiving data, processing the data, displaying the data). Sometimes methods are performed by users or by the client device (e.g., phone), and thus your statement is most correct for these types of claims. A system claim claims components that make up a particular apparatus (e.g., a text input component, an input processing component, etc.), which can include software components. The infringer of this type of claim is anyone that builds such a system, which again is likely the handset maker, but may also be the code author.

    • asymco

      Thanks for clarifying.

  • http://boswellip.com/ Mason Boswell

    Finally, CRM claims can claim instructions stored on a storage device (e.g., code on an FTP server), as well as data structures. These claims were invented back in the pre-Internet days when it was desirable to be able to serve an injunction upon CD disk pressing companies to stop the pressing of infringing software. Companies didn't want to wait for the applications to get in a user's hands to be able to do something. Look up Lowry and Beauregard claims for more information on CRM claims, named after the two cases that established the legitimacy of these claim types.

  • expandin

    That article is just horrible! Apart from anything you wrote (which I agree to completely), There's are soooo many errors they made it's unbelievable…

    My main two problems with this Canalys article:

    1. Why do they speak of 33 Mio. Android SHIPMENTS, when Apple SOLD 33 Mio. iOS devices… Sold means Final… Cash in Apple's bank account… Shipments are mostly liabilities, since nobody knows all of them will find a buyer.
    2. They compare Android vs. iPhone (excluding all other iOS) devices. Unbelievable…

    The guy who should be best advised to consider thinking about the meaning of those numbers before posting them in such a wide-spread analysis or find another job. Those numbers just can't be compared for several reasons…

    • Rob Scott

      I Agree.

      That was my reaction too when I saw Android the OS being compared to iPhone the device. That is why yesterday I asked that Horace in addition to his vendor analysis that if possible he add an OS analysis.

      If we are talking mobile platforms and which platform developers (and user) should patronize we need to be comparing apples to apples. As you pointed out Android and iOS sold about the same number of units at 33 million each.

      The refusal of these research firms to do this simple comparison suggest at least to me that they have they own agendas that have nothing to do with telling the truth. And that most are biased against Apple.

      • expandin

        Completely agreed. It's just too obvious how biased those research companies are against Apple. The analysis seems to have been forged in every single way possible in order to make the pre-defined statement that Google just overtook Apple, in order to make headlines. Even if Google doubles the market share during the next two years, I doubt this will mean anything other than 500 handset makers will be competing in the race to the bottom, while making 30$ per device from selling the #1 search spot to Bing on their Android devices. Nobody points out, that one company (Apple) is making half the industry's profits with 4% overall phone market share… That is in fact very impressive! Nobody except Horace points such facts out. That's one of many reasons I love Horace's insightful and "data-backed" analysis instead of articles like the one by Canalys..

      • Evan

        yes the world is out to get Apple as everyone is jealous of Apple lol. It is a vast conspiracy theory. If you are comparing platform companies, facebook platform is the biggest right now. Developers need to make money, they do not need to restrict themselves to mobiles or mobile apps or mobile websites or HTML5 webapps or whatever. Facebook has 700 million users. How many android devices or iOS devices are in play ?

    • Hamranhansenhansen

      What's worse is Samsung says Galaxy Tab is not a big phone, it is a tablet, and Dell says Streak is not a big phone, it is a tablet, but Canalys includes Galaxy Tab and Streak but excludes iPad. Then again, I agree they are not tablets.

      Ultimately, there are a lot of PC industry people who want to see the phone industry become another PC industry, and Android makes sense to them, so in trying to make sense of the phone market they take an Android-centric or generic-centric view. So we will see a lot of really blind analysis. The fact that phones is becoming another iPod industry is as inconceivable to PC people as the iPod was originally. But of course it is obvious which is the odd one out if you compare iPod, phone, and PC.

      • dchu220

        It's hard for a lot of companies in Asia to accept that Apple has figured out how to counter their 'fast follower' strategy. A lot of CEOs here have made statements saying that the iPhone and iPad will eventually become niche products. Meanwhile, they are having a hard time getting their hands on critical components because Apple has bought the whole lot.

      • Evan

        I see, thats why there were 33 million android phones sold last quarter, more than double iphones. A big den of apple fanbois on this blog.

      • expandin

        33 Mio of like 400 different devices vs. 33 Mio. of 3 different devices from Apple. If let's say Samsung Galaxy S will outsell the iPhone… that's what I would call significant. BUT only if they match iPhone's price. It's usually a LAW of supply and demand that lower prices attract more demand. Now let's not compare demand for 300 SHIPPED not SOLD devices with a mean price of 250$ vs. 3 devices with a mean price of 500$ or so. If Apple would have lowered their mean prices to the mean prices of all Android devices I think we should expect to see extremely different demand proportions. Plus don't forget that those 33 Mio. devices were shipped, while 80% of them are probably still in the inventory. While Apple's 33 Mio. are already in people's hands…

      • Evan

        you are wrong, Apple also reports channel sells in, it is a well established industry practice. So when apple says they sold 16.2 million phones, they are channel sell ins to retailers, operators etc. Why should a developer care whether galaxy S is priced higher or lower, so from whose perspective are you looking at? Carrier subsidies distort everything in US, even if Apple sells stuff for a 100 dollar less, operators might still sell it for 200 dollars to the customer with the contract, keeping the change of 100 dollars for themselves.

      • Kizedek

        What part of phone to phone, and platform to platform, comparisons don't you get? You are right here perpetuating, still, the same inconsistency among the analysts that everyone here is referring to in comments above your. How many commenters, in addition to the article, need to point it out before you twig.

        When speaking of "Android", it is logical to speak of iOS (iPhones, iPods, iPads). When speaking of iPhones, it is logical to compare it to other smartphone models, like the Motorola Droid.

        And yes, 33 million Android phones vs. 33 million iOS devices is more significant for Apple. because when you compare devices to devices, and not the platform (all Android devices from all device makers), you see that Apple with its three devices on fewer carriers in fewer countries is comparing very favorably in terms of units sold to any maker of Android devices (or any phone OS) — but in terms of value and profitability, there is no contest.

        Secondly, much of the 33 million likely represents units in the channel, NOT sold; despite the misleading use of the word "sold" by analysts and writers everywhere. Whereas, Apple's figures always represent units sold to end users.

        Furthermore, if one were inclined to compare platform with platform, one has to consider the nature of Google's Android "platform", and wonder how it is really working out for Google as its "vendor"? Not only is it "fragmented" and a large percentage of devices remain on old versions; not only is it customizable by device makers and carriers who can exclude Google search in favor of Bing if they so choose; but apparently many of the units counted represent Chinese variants of Android that have nothing at all to do with Google and do not bring value to other users of the platform in terms of interoperable apps, app stores, ecosystem, etc. Simply put, this so-called, amazing "expansion" of the Android platform, is anything but.

        Go figure. But I don't know why I am commenting, since a plain reading of the article and most of the comments above should have communicated all this to you. One can only lead a horse to water, but I am hoping that repetition precedes understanding in this case, despite Horace's commitment to less noise on his site. Sorry, Horace.

      • Evan

        ok lets compare platform to platform, iOS platform is lesser is size compared to facebook platform with 600 million users

      • expandin

        That's true, but I doubt Facebook makes 300-500$ in profits from every single Facebook user. Facebook is not a direct competitor to Apple in the market for smartphones. BTW, we are talking about FREE facebook accounts of which at least 30% are duplicate or fake. If facebook were to introduced membership fee's of of say 300$ per year, I doubt they would still maintain more than a couple million of active users. Again it's just comparing free against "the most expensive". Even at 20% the sales of Android devices, Apple would still be making more profit than most Android handset makers. Profit is meaningless, unless it's key to making large strategic investments and commitments.

      • Evan

        facebook is much more profitable than Apple or Google or microsoft. Their cost structure is much more cheaper/simpler than either Apple or Google. And their operating margins are way higher than google or Apple. This is what was revealed to a few select clients by Goldman Sachs. This year it is 4 dollar, next year it is going to be 5 dollar and so on, whereas Apple;s will not move materially forward from 400 dollar. Besides you were the ones who was talking of reach of the platform, facebook platform has a bigger reach than either iOS or Android and developers are concerned about 'reach'

      • Kizedek

        Of course they are "more profitable" and their operating margins are "way higher" :
        Apple actually, you know, MAKES STUFF. About seventy percent of the price of each device Apple sells is actually the cost of parts, engineering, manufacturing, assembly, distribution and retail mark-up. Not to mention R&D, etc.

        So, Facebook employees sit at their desks and type code all day long. No operating costs there. Duh. Turn the lights out when you go home tonight, guys.

        What is the aim here? To applaud only the creation of new virtual .com companies, and denigrate the industrial design and manufacturing of computing devices as an industry that has any value? We all use computing devices to access Facebook in the first place!

        Kudos for attempting a valid comparison this time (platform to "platform"). Too bad you are still comparing Apples to Oranges (comparing virtual "platform" design to the whole gamut of fields that includes that, plus runs from industrial design through manufacturing and assembly to physical distribution).

        Platforms were defined earlier somewhere (in this article or another recent one): they include fostering a whole ecosystem that enables different companies to add value by participating.

        What does the Facebook "platform" foster within its walls? Some web apps and flash apps, ads, data mining, links to other websites where you can buy stuff, virtual currency for limited uses. Basically, stuff that Google and others are doing already on the internet anyway. This is just a walled off part of the internet, like AOL. Perhaps not a "platform" at all.

        What does Apple's platform foster? Not only all the above, but also: physical devices and accessories such as cables, adaptors, cases, ear phones, keyboards, bags, and stands; new devices, such as bar code scanners, card readers, blood analyzers, etc.; new business models and services, such as rental car door opening, augmented reality, small business administration, project management, team planning, teaching, learning, interactive language learning, music lessons… and the list is endless.

        Apple's platform fosters practical applications and solutions that require the immediacy of interactive touch input and actually provide added value above what was possible before. Facebook is providing little that was not already there on a variety of platforms and networks all along.

      • Evan

        if I am a developer looking to make money from platforms, I need reach and customers who pay or make money from subscriptions or ads or whatever and zynga shows me you can become a 20 billion dollar company with 800 million dollars revenues and possibly the fastest growing company in the world at the moment just behind groupon. Now tell me which appstore focussed company is making a billion dollars ? you are missing the forest for the trees, currently the stuff that is happening is that offline world is coming online, offline social is going online, the online world is starting to mimick offline world. Groupon, Zynga are offline concepts rolling over to online, this is a much more powerful concept than iOS appstore phenomenon. Apple thinks that they can pull the same trick they did with music, with newspapers. Not going to work, people read less newspapers and watch less TV, they get information/entertainment from the web. If they want movies, they go to theatres to get real good experience. People spend 1 hour a day on facebook, half an hour on youtube which is only going to increase and ads/ecommerce money is going to transfer from offline to online. Newspapers, TVs were the window to the world back in pre-internet era, not anymore. Now it is the web. Netflix is already a faltering business model, they don't own the content and are subject to the whims and fancies of the hollywood studios who are clueless about internet. So you are saying social games are not adding value ? why exactly ? is angry birds adding value ? I feel it is so silly that a silly little game is the topmost grossing game, but we should leave it to the crowds to determine what value they find in the various services. Wisdom of the crowds is difficult to determine. How would you describe groupon, the only way to describe it would be offline to online phenomenon, they have nothing to do with appstore or android market. Groupon shows me you don't even have to depend on appstores and instead depend on the greater phenomenon of offline to online. Much more powerful and longer lasting. Countries like India, China may not even have good enough online services, if I was an investor, I would fund innovative companies in the developing region who are bringing things online like tencent, alibaba, flipkart etc. If Apple was as forward looking about the web as they are for making great user experienced focussed hardware devices, they would go strong on ecommerce and insist on taking a 30 percent cut from all in-app ecommerce purchases and put more efforts into their own social networking features and forget newspapers and confine them to the dustbin, a relic of the previous era, newspapers are the trucks, not PCs.

        Come on tell me, who is making a billion dollars in revenues from appstore focussed company.

        Now you are focussing on subjective emotional things as to what constitues a platform, developer is focussed on ROI or bang for the buck.

        If you ask me building a relevant search engine is much much more complicated and tougher than building a device. But hey I like google :)

      • Evan

        facebook, groupon, google, zynga,amazon represent the phenomenon of offline to online.

      • Evan

        as a groupon consumer, I don't care if groupon app provides a better experience than my PC, I just want a damn good deal.

      • Kizedek

        Oh, did I mention Stores? Where are the brick and mortar Facebook Stores all over the world?

      • Evan

        is that relevant ? we are discussing platform reach, facebook is a virtual empire.

    • davel

      what is a mio?

      • expandin

        Sorry that's Million I meant. Mio. is the abbreviations we use in Germany instead of mln/million.

  • http://www.sirena.org.uk/log/ Mark Brown

    Android isn't entirely open source – while the bulk of the OS is available as open source things like the gmail and maps applications, plus the market, are only available under license from Google. For any handset with any of the Google proprietary stuff on it there will be some sort of relationship between the handset vendor and Google.

    • 2sk21

      Very good point – do the real vendors have to pay Google for installing these apps on their devices?

      • http://twitter.com/rurikbradbury @rurikbradbury

        A nominal fee for Google's apps; but that is often counterbalanced by Google paying to be the default search provider.

        @Horace — I think you could have pointed out the points where Google DOES have leverage to dictate to implementors. For instance, control of the Android Compatibility Program, ownership of the Android Market, control over the release schedule, and control over the 'reference editions' of Android and its pure-form OS (for instance the Nexus One or Nexus S).

        In practice, Google does have significant control over the path of Android and the end user experience. There has never been a successful Android device (outside China at least) that has originated outside the Google fold.

      • Hamranhansenhansen

        There has never been a successful Android device outside China at all. Verizon Droid sold a million, but Motorola lost money on it. Nexus One was an embarrassment. In the aggregate, you could say non-China Android phones are successful, but individual devices? No.

      • dchu220

        I believe HTC is making good money. Im pretty sure that Motorola made money on the Droid, but it's bottom line is being killed by it's feature phone division. But yes, in the long run, its going to be hard for these manufacturers to keeo making good money in the long run.

    • http://twitter.com/turleymuller @turleymuller

      Correct. But Google's products & services aren't part of the Android OS, they are applications for the OS. Anybody can grab the Android OS and do what ever they want with it, but if they want to ship with Googles stock applications & UI etc. a license is needed.

      Android doesn't always equal Google, yet Google gets credit for all Android devices. How did you Google loved the Yahoo Android from AT&T? or the Bing Android from Verizon? Or India & China? They seem to be counted and attributed to Google device sales per analysts and media, yet there isn't a lick of Google on those devices,. In a sense those Android devices can evolve into a entirely new platform in itself. Android is used for hardware instructions & I/O as base for building customized features and experience on top of it. And that just compounds fragmentation.

      • Alan

        I thought I remembered either Eric Schmidt or Andy Rubin saying that when they call out "activation" numbers they are only referring to devices that have the Google Apps / Marketplace on them. I think this was in response to Steve Jobs calling them out about whether they were counting OS upgrades or all new activations.

        I don't have a link but as I recall they said there could be far more Android activations that don't use the Google Apps since those activations don't need to register with Google.

      • http://twitter.com/turleymuller @turleymuller

        Correct. Google's numbers only refer to activations, but don't believe it only pertains to phones with Google's apps, I believe it also includes certified devices which can access to the app Market that don't have Google apps. (IE Bing / Yahoo / Carrier / Vendor). When phone activated on network, the UDID is registered with Google. Android devices that haven't been certified don't count in those numbers, however, I believe the industry research outfits count them.

      • Steven Noyes

        But should devices not part of the Android eco-system be counted? If they do not have access to the Market Place, don't have Google Navigation, don't have Google as a search engine, don't have the GMail App (Why do you need 2 mail apps anyway) are they really part of the Android eco-system. As a developer, it is hard to target those devices. They may as well be StevenOS or BubbaOS.

        As a developer, I am really only concerned with the number of unique devices within the Android eco-system and this does not include OMS or Tapas OS as I understand it.

      • http://twitter.com/turleymuller @turleymuller

        Exactly. My point as well. Certainly non-Google configured devices shouldn't be counted in the Android ecosystem with respect to ascribing acclaim for Google's domination when in reality some device sales actually benefit competitors when search is locked to Yahoo/Bing. Or when there is some derivative OS on top of the core altogether.

        Developers would only be concerned with the number of devices with rights to the App Market. Which, I believe… is the consistent with the activation figures Google occasionally provides. But even then, I would think it's hard to know the real size of the potential market due to possible device fragmentation. Maybe you develop some code- only to find out later that from the 100's models you weren't able to test code on, a number of them don't get along with the code. I guess the severity of the problem will depend on the popularity of those devices along with just how concentrated they are with targeted users

      • ayedee

        Agreed. There are too many unknowns here to precisely quantify the relative strength of the two platforms. Sheer number of activations is important, but only one variable. The best indicator we have available to us is developer activity, IMO. Developers follow the money. The money is there when the platform is strong. From this perspective iOS appears to be much stronger than Android today, despite the numbers. When (if) we see a shift in aggregate developer energy from iOS to Android development, then we'll have a good indicator that the Android platform is "surpassing" iOS, but not until then.

        I'm not sure that will ever happen, at least in the next several years, though I think it's safe to assume that there is *some* point at which sheer numbers will tip the balance in favor of Android. What will that ratio be? 2-to-1, Android-to-iOS? 5-to-1? 10-to-1? I'm going to go out on a limb and say it's closer to 10-to-1 given the massive fragmentation issues Android has, which are only going to get worse, but again it all depends on the above mentioned unknowns. I'd love to hear other takes on what that ratio might be.

      • Evan

        the other important thing is how many iOS focussed companies are public, how many have gone IPO, how many are big name companies. How big is Rovio? How much is EA dependent on iOS for revenues etc. If you take facebook platform, Zynga is valued at 20 billion dollars, if you take google apps platform, Salesforce just bought out manymoon for 30 million dollars, Apple bought out siri for 200 million dollars(the biggest acquisition for iOS focussed company), so based on that I would say facebook platform is where the money is at.

      • davel

        i think the issue is we all know that android has been enjoying great growth in popularity. the problem is quantifying it as everyone has different methods of measuring it.

        neither google nor the android device makers make much of an effort to publish any real numbers.

      • dchu220

        I doubt we will ever really know until manufacturers start releasing sales data, which they are unlikely to do. Until then, I think the only way to really measure the domination of one platform over the other is by browsing data or app store download rates.

      • davel

        so if they count google apps activation they are also including most apple devices since they have google maps.

        no?

      • Evan

        android market activation is what is being counted. You have to register the android device with a google account to access the market.

  • http://twitter.com/pcad @pcad

    "Furthermore, Google cannot ensure Android users have any specific experience. They can't encourage upgrades, service models or any form of common UI. The experience, like the protection of property is the responsibility of the implementor."

    But they could if they're the vendor of the phone (Nexus One). My guess is that we'll see a lot more of this model. The problem for Google is that they may know web advertising, but they're a pretty mediocre retailer.

    • Hamranhansenhansen

      Google has sold a completely insignificant number of phones.

      • Evan

        are you privy to internal google details ? how do you know how many nexus 1 or nexus s were sold ?

      • davel

        if google sold 10 million of them they would have said so.

        just like samsung said they sold 10 million but very few vendors actually break out their numbers.

      • Evan

        google did say nexus one was a flop, they haven't said anything yet about nexus s

  • David W.

    I’ve always said that Android is one malware away from irrelevancy. Let’s say there’s a major security flaw found in WP7, iOS, and Android. In weeks, all iOS and WP7 devices will be patched. Within weeks, Google will put out a security patch for Android, but then it is up to the individual vendors to push that patch through to their users. Will they do it?

    It doesn’t look so good. My son bought an Android phone that T-Mobile promised him would be upgraded from Android 1.6 to Android 2.1. It never was. He rooted the phone and found a Android 2.2 version to put on it, but so far can’t find an Android 2.3 because not only does each and every version of Android must be compiled for each and every phone, but the underlying drivers for that phone must also be built.

    What happens to all of those people still under contract, but with “older” obsolete phones that are six months old? I can guarantee you that if there’s a security issue, Apple will patch all versions of iOS even for the original iPhone. I can’t say the same for Android.

    • http://twitter.com/pcad @pcad

      Good points.

      This certainly complicates corporate sales as well. With people running all manner of phones, how would a critical fix be rolled out?

      • Hamranhansenhansen

        Companies will hire an army of Google Certified Support Engineers at great expense to build and deploy custom patches.

      • Evan

        just like how Apple handles the massive amounts of apps flooding in everyday to its appstore, by hiring a vast army of censors from North Korea and China ;) which is completely unscalable and totally manual.

      • Kizedek

        No, it's not "just like". There you go, comparing Apples to Oranges again.

        The comparison is between what happens when there is a critical security flaw in the OS, Android or iOS? How do updates get pushed out to the devices belonging to individual users?

        iOS: everyone gets an email memo that says, "please sync your device with iTunes tonight and click the update button. Thanks guys, see you in the morning."

        Android: Companies will hire an army of Google Certified Support Engineers at great expense to build and deploy custom patches.

        Are THOSE two comparable scenarios "just like"? No, not by a long shot.

        And to comment on your completely irrelevant point about Apple hiring an army: yes, Apple's iOS platform is so popular with developers that it must hire a vast army to do what reviews of the software it can, as quickly as possible, so that consumers like you and me have even more apps to choose from.

        How is Apple's popularity "problem" in any way indicative of the very real problems and expenses and time wasting that other companies will face due to any security flaws in Android running the devices their employees use on a day to day, mission-critical basis??? I still don't follow the flights of fancy you take in most of your comments.

      • Evan

        if HTC doesn't fix security issue, HTC customers will move on and HTC will learn a lesson. Replace HTC with any other vendor/OEM. Apple's problem is that manually checking/verifying apps is not scalable and is prone to errors/mistakes since humans are prone to errors/mistakes, self-serve platforms are the ones that can scale. No other platform manually checks for correctness in so stringent a fashion for compliance with various whimsical apple policies neither facebook nor android nor google apps marketplace nor blackberry. This is potentially dangerous to Apple in the long term, because developers might move on competing platforms or horror of horrors(from Apple's perspective) might start creating wonderful mobile webapps so that they can reach all platforms/devices at once.

      • davel

        This is true and Apple has had to change their ways on several occasions because of exactly that.

        however, there is really no alternative.

        there is no mechanical way to vet applications.

      • Evan

        there is, how about facebook platform which doesn't vet applications mechanically and is wildly successful

      • dchu220

        The problem doesn't just rest on HTC. Each carrier would need to approve, possibly test, before rollout. Logically, you would think that everyone would act in the best interest of the user, but that doesn't always happen.

        Not all apps will move to web apps. You can't approach every problem with the same hammer. Some apps will perform better natively, some will as a web app. It depends on the job the user wants done.

      • Evan

        not many consumers reads tech blogs who keep shouting from the rooftops on any perceived weakness of Apple or Google and they won't even be aware that there is a security issue in the first place, a smartphone is a consumer device, not an essential device like a PC. PC goes down works goes down, smartphone goes down, entertainment goes down. I am pretty sure most consumers are only now getting awareness about android, they won't even know about the different versions of android.

      • dchu220

        We'll see about that. A lot of that just takes time. I'm sure there are corporations working on putting a bunch of their workflow into apps. Apps are still relatively new and businesses are usually later adoptors.

        You are a smart guy, but I think it's dangerous to make blanket statements like Smartphones are only for entertainment. It's a different paradigm from what we are used to, but it will come.

      • Evan

        There is no way corporations are going to standardize on iPhones. You are guessing that the same game will happen because corporations standardized on PCs last time around and because of which PCs won, this is a different era, we are living in the cloud era, in the cloud era, a smartphone is just one type of a node which is connected to the cloud, a smartphone is just a thin device with a small memory footprint OS and smartphones will be part of the fabric. The magic happens in the cloud, and the smartphone is just a frontend. It is not going to be the only one or the most dominant or the most important, probably the most numerically dominant yes. PCs, Tablets, Notebooks and smartphones are all going to co-exist. PCs are not going to be the trucks that Steve Jobs tells us. Google and Salesforce have the better ideas here, I am not talking about android market, I am talking about their google apps marketplace/fusion apps for enterprises which is device agnostic and browser based and which can work equally well on android or iphone or windows 7 or blackberry or whatever else. Facebook platform is also device agnostic, it works at a higher level(a very sticky social graph) than the simple minded android or iOS platforms. Just like how you apple fans say this is not PC v/s Mac redux, similarly corporations will not simply adopt the most dominant platform, times have changed, internet has entered the fray and disrupted the previous business models.

      • dchu220

        I wasn't arguing that iPhones would be the dominant platform, only that smart phones are going to play an increasingly important role. On the corporate side, I do think that web apps will dominate, but on the consumer end I actually think native apps will do very well. I don't want to go too deep into it since this thread is getting massively long.

      • Evan

        consumer want solutions, not native app or webapps.

      • dchu220

        Exactly

      • Evan

        we agree wow :)

      • Evan

        and to be blunt, just like how google does not understand the importance of designers, Steve Jobs does not understand the importance of cloud(unless they buy their way through to successful cloud companies of course)

      • Coward_the_Anonymous

        1. 10 years ago online was 2% of offline, now online is 3% of offline.
        If online will be 10 % in 10 years it will be huge achievement. Short-term Walmart can sleep well…
        2. Facebook has 700 millions users and only 2bln revenue? a year? How much cash does Apple earns quarterly?
        3. I did not know Apple has no clue what me.com is for. Not as widespread as Google services, but hey, they did not employ adware into it yet.

      • Kizedek

        Don't see an issue here. There are about three levels of consideration here, pretty much all of it in favor of Apple:

        1) the OS. As noted above, any fix or update is taken care of by Apple in a timely manner and can be implemented by everyone at one time almost immediately — everyone clicks the update button in iTunes and, voila, everyone is updated over night. Android? Whether Google, HTC, the carrier or the company can roll out an update in a timely manner is very much uncertain, let alone to everyone at once (hence the need for an army of certified technicians, expense and time). You were saying something about "scalable"?

        2) third party apps: The security issues for these are exactly the same for both platforms. In fact, it is worse for Android because no attempt at all is made to vet apps and there are known cases of malware, etc. There may be one or two cases on iOS, and the apps are pulled immediately, both from the store and possibly from any device it is installed on. Mostly, the malware attempts on iOS were through emails telling people there was a problem, and this email was a phishing attempt. In any case, a solution is that companies forbid certain apps or types of apps from being installed on employee phones.

        3) special, proprietary company apps deployed by the company to employees: the issue is again pretty much the same for both platforms. Probably easier on iOS — much less instability and uncertainty about the OS, see #1 above. Also, the Apple SDKs are superior and are known quantities. And yes, the built-in enterprise features and security are very much there on iOS, so there is no reason companies should be hesitant about the iPhone, as is being demonstrated every day.

        All in all, sounds like you are making a case for potential fiascos and costs on the Android platform as being "a feature". LOL.

        Great, so a company that has just deployed thousands of HTC phones will be happy to learn a lesson and just "move on" when they have issues, as they will? Nice feature!

        Great, so because the review of apps on the iOS app store may be prone to human error, let's go with apps that are not checked at all, on a system where "anything goes, and which is known to be susceptible with real examples of malware in the real world? Nice feature!

        Great, so let's NOT go with a platform that is subject to stringent operating policies because those policies might be "dangerous" to the platform owner… let's go with a platform whose owner doesn't give a flip because that will just be dangerous to ourselves as a company instead! Way to turn a disregard for customers into a nice feature!

        You are really batting three for three here.

      • Evan

        no company deploys smartphones, that era is over and finished with blackberries. BES is dying. Now companies allow employees to bring in any phones they need. Sure there are few companies that deploy vOIP deskphones, but how big is that market ? not very big I suppose.

      • dchu220

        Is Walmart not scalable because most of it's workers are stockers and checkers?

      • Evan

        walmart is not a tech company and besides it is losing out to amazon on the online front, its offline dominance has not been translated to online which is growing faster. Walmart does not have innovative rivals like Google, Facebook and Microsoft who can pounce on any weakness of Apple quickly. The rivals they have on the offline front are boring companies like costco and target who are as clueless about online stuff as walmart.

      • dchu220

        I think Walmart would argue with you on that one. You are talking about a company that has one of the largest super computers in the world tracking global supply chains. I think they would think of themselves as a tech company also.

        My point is that not everything can be computer automated. It depends on how your store creates value. The App store philosophy is that having a curated store makes people feel safer about buying apps and therefore they will buy more. Most of the tasks are probably automated, leaving a few critical decision points for real humans.

        Interesting debate on the merits of human versus computer decision making.

      • Evan

        walmart has struggled online, not many buy stuff from walmart online and online is growing faster than offline, basically more stuff is moving online than offline. Online is a parallel economy, even if offline economy enter a recession, online economy will continue to grow as more people go online, buy online, play online, talk online etc. Google has the largest super computer roughly speaking if you consider their computing power/resources . they have 2 percent of all the world's servers and they act like a supercomputer in unison. Microsoft has a big one too maybe not as optimized.
        Human curated stores are not scalable in the long run. They are inherently limited by human weakness and human speed which is pathetically slow and more prone to mistakes because humans are fallible. Self-serve highly automated platforms are the ones which will scale. Different business models ubiquity v/s scarcity. I believe ubiquity business model will win.

      • dchu220

        First, let me say that I am enjoying hearing your point of view.

        I understand your point. Google Adwords let the average Joe Schmo advertise online effectively, easily and affordably. Algorithems allowed Google to rank each ad by their effectiveness. It forever changed online advertising.

        We will see if Google can apply the same ideas to their Marketplace. But apps and ads are different products. I live in Asia so I don't know how the US Android store works, but out here it's filled with copyright infringing apps. A lot of the cellphone companies have set up their own stores with 'curated' apps. I'm sure someone will eventually figure a better way to do this. These things take time.

      • Evan

        nobody does serious work on a smartphone, it is just a media consumption device which is used to play some silly little games like angry birds or listen to songs or read some emails. Nobody cares about serious flaws on a smartphone.

        Apple was always a niche player, it is only now that they are becoming a mass market player with iOS devices, they are going to face a huge amount of issues as and when they grow up.

        Not many companies deploy or standardize on a particular brand of smartphones, that era is over, consumers are going to bring in a multitude variety of devices, all companies will do is provide instructions to how to configure emails for various kinds of smartphones. What companies have is contracts with operators so that they get bulk discounts.

        Companies are more concerned with technology that directly impacts their bottom line or top line like having a world class database or a world class CRM with round the clock 24/7 support. Smartphones who cares. If a smartphone for an employee goes down, company still functions at 100 percent efficiency, if a corporate database goes down, company will be affected materially.

      • davel

        this is incorrect.

        companies absolutely do standardize on devices they allow on their network.

      • Evan

        no they don't, I work in Oracle, a big 100K employee company and there is no standardization. We support nokia, blackberry and IPhones. My friends work in a lot of big IT Companies and nobody has standardized on a phone. I have friends in investment banks like in Barclays, employees are free to use any smartphone. Phone is not an essential device for the functioning of any of the companies that I am aware of.

      • dchu220

        I think smart phones are too new to be used as the backbone. That's what Oracle is good at and does well. But they can handle peripheral tasks. Take an example of a corporate exec who has an app that updates him on the key real time metrics of his department. Not mission critical, but still a valuable service.

      • Evan

        hmm

      • Evan

        that seems convoluted.

      • dchu220

        A quick google search shows that there are a couple companies working on such apps. I guess we'll just have to let the market decide if it is useful or not.

      • Evan

        ok, doesn't seem to so great to me or critical as well. Might make some change money for the developer. That was part of my point, the next big idea is not yet coming from appstore apps, maybe instagram might be the next big thing, but I doubt it.. The next big things are still coming from the openweb like groupon.

      • dchu220

        The next big things will come from the open web for a while, mainly because the install base is HUGE and the smartphone market is likely to remain a mess for a while.

        Haha. Make that two things we agree on. :)

      • Kizedek

        "nobody does serious work on a smartphone, it is just a media consumption device which is used to play some silly little games like angry birds or listen to songs or read some emails. Nobody cares about serious flaws on a smartphone."

        You obviously don't get out much. The apps I use the most on my iPod Touch / iPhone are productivity apps that address real work solutions. They are essential tools for entrepreneurs and freelancers and small businesses.

        To name but a few, there are: project management and invoicing apps, database creation apps, VPN and file sharing apps, remote desktop apps, CRM apps, sales apps, time management and clocking apps, note taking apps, expense report apps, mileage and maintenance reports, Google analytics… I could think of serious work apps all day long.

        Tell, you what, why don't you go look in the App Store and look at some of the top grossing apps in many categories (productivity, business, photography, etc.?

        I guarantee you there are millions of people out of the 160 iOS users that do "serious work" on their iPhone.

      • Kizedek

        "Nobody cares about serious flaws on a smartphone."

        ??? You just spent a couple of long posts on how the flaws of the iPhone, Apple's iOS platform and Apple's policies will keep it from being widely implemented in the enterprise (despite much evidence to the contrary); while HTC phones or similar will be great because, as soon as their flaws come to light, the company deploying them will just learn its lesson and move on to another phone maker (and facing exactly the same issues due to the same Android platform flaws). Sounds like some lessons require relearning. Again.

        Overall, you seem quite incoherent and merely argumentative.

      • Evan

        nope, I was mentioning why Apple appstore will not scale, and why appstore will not be the holy grail for developers, it will exist as part of the fabric, but companies/developers which succeed will solve a problem for the user or satisfy his need and will leave behind a legacy, the business model for a company is solving a problem. Native apps or webapps or facebook apps are a just a means to an end.

    • Hamranhansenhansen

      Or a court ruling. If Android had to be patched to stop infringing.

      Also, if Oracle wins their case, the remedy they asked for is for all copies of the Dalvik engine to be destroyed. That would obsolete all Android apps.

      • Sergio

        "We demand the destruction of the Dalvik engine!"

        Great line, it wouldn't be out of place in an episode of Dr Who… I'm imagining Oracle's lawyer as a dalek.

        Seriously though, isn't this whole issue with software patents only really enforceable in the US? And if so, wouldn't most manufacturers have already taken this 'hidden' cost into account? (i.e. any litigation settlement would be limited to US-sold units, so companies like Samsung or LG would be OK with it, a bit more of a problem for Motorola, I guess).

        As for the destruction of the dalvik engine… I'd be surprised if Google isn't already working in a replacement.

      • http://twitter.com/_ChrisHarris @_ChrisHarris

        I can tell you from watch the SCO / Linux battle that it will take 5+ years for that particular legal fight to play out.

      • Evan

        by the time android will be on a gazillion devices.

  • Nate

    You may have already covered this, but I'd be fascinated to see exactly how Google is benefiting from all these Android devices on the market. Everyone in the press is talking about this as a big Google v. Apple showdown, but Google and Apple get different things out of device sales.

    For each iPhone sold, Apple gets $400 in profit and a new user of the iTunes ecosystem.
    For each Android phone sold, Google gets… another person that will use Google Ads? Is that it?

    • Hamranhansenhansen

      I read somewhere that Google makes more money off each iPhone user than each Android user.

    • Rktheac
      • Rktheac

        I neglected to mention that the link has been posted here before, I believe, but it's worth linking again.

    • Evan

      yeah, you forget android market, google apps, the best experience of google services etc.

      • Kizedek

        yeah, you forget that the developers are not making any money over there. Oh, and Google never gives the "best experience" of anything. Any third-rate iOS developer can come up with Google services app that rivals the experience of Google's own apps.

        You may mean that certain features of Google's services are restricted to Android apps. But since the experience sucks, these are largely regarded as non-essential features, as we shall see when Verizon customers vote with their wallets this month.

      • Evan

        I rather be groupon than a iOS or android developer, I want to leave a legacy behind. The lure of the open web is pretty strong :) I will let the iOS/android developers fight for scraps. iOS developers are making more money than android developers agreed, but all iOS developers put together are making less money than groupon, if I was a developer, I would try to solve a problem. Groupon is just a sample. Let's see which iOS appstore focussed company hits a billion dollars in revenues.

      • Evan

        all google services are essential(except for youtube maybe). Google search is required by everybody, it is the ultimate research/utility tool.

  • http://twitter.com/dutchtender @dutchtender

    sometimes when something good is happening the only thing left to do is acknowledge it.

  • http://standardimagination.com StdImagination

    If Google owned the source and were giving Android away, wouldn't they be creating an anti-competitive advantage that would make them subject to anti-trust laws?

    • dchu220

      No.

      • http://standardimagination.com StdImagination

        it was true for Microsoft when they were found to be using their market advantage in Operating Systems to distribute a free browser in an manner that was deemed anti-competitive. They were trying to cut the oxygen off for competing browsers. How is this any different? Android being given away makes it harder for other mobile OSs to survive.

      • unhinged

        And yet iOS is doing just fine…

        There has to be evidence of harm before action will be taken.

      • http://standardimagination.com StdImagination

        There may be other nascent mobile OSs out there that can't get a foothold because of Androids free price point. We'll never know because they'll never see the light of day.

        maybe.

      • dchu220

        There are always nascent companies that can't get a foothold because they were too late to market. That's life. The ship has sailed on mobile OSes.

      • Evan

        you forgot Palm's webOS that lost to droid in Nov 2009

      • dchu220

        Which is probably why HP is looking to re-enter the market with WebOS in the tablet space instead of the phone space.

      • Evan

        HP will sell a few webOS tablets due to their channel partners and then die away. Poor HP, left with commodity PCs and servers and printers that nobody wants. Lets see if they make webOS successful. I seriously doubt it. They have been caught with their pants down in the cloud era and consumerization of IT.

      • dchu220

        We'll see. Honeycomb and WebOS demos are coming soon. Exciting times.

      • Evan

        consumer buzz is negative. does anybody know that HP exists

      • Sergio

        The HP/Palm newsletter promises 'something big, something small and something beyond your expectations', so it looks like they'll be presenting at least a phone and a tablet; the 'something beyond your expectations' must be something more abstract, maybe new OS features in WebOS?

      • Evan

        HP is too late.

  • http://twitter.com/stannenb @stannenb

    As Motorola discovered (http://gigaom.com/2010/09/15/skyhook-sues-google-in-a-location-battle-royale/), there are limits as to what you can do with "open" Android. You can find the full complaint here:
    http://www.scribd.com/doc/37516188/Skyhook-v-Goog

    Money quote:

    Google maintains the Android Compatibility Program, which describes what it means to be "Android Compatible" and what is required of developers and device builders to achieve compatibility with the Android Operating System.Google states that in order to distribute Android devices, and to leverage all of the benefits of the Android ecosystem, which includes access to all the third party applications and services available in the Android Market, device builders must participate in the Compatibility Program and must be deemed Android Compatible.

    ******

  • Pingback: Android och dess skakiga fundament | MaxiMac()

  • Evan

    so you are saying 33 million android phones are insignificant, but 33 million iOS devices is significant ? and canalys is counting Ipads under PCs and telling that Apple is 3rd largest PC vendor, nobody is complaining about it. Get out of the persecuted victim complex. Nobody is out to get Apple, certainly not Google.

    • http://twitter.com/aegisdesign @aegisdesign

      Ah, I remember the old days (Last week) when everyone was out to get Nokia. ;-)