It does honestly seem like Google stumbled into a goldmine. Google basically set out to create the Sidekick 2.0 (I don't really get the constant "Android started as a Blackberry ripoff" claims, when there are much more obvious Danger roots). I really don't see Page/Brin/Rubin in a room in 2006, rubbing their hands together thinking they were going to shock the world. It seems more like the Google guys were big Sidekick fans and saw the chance to work with Rubin for relatively cheap. But they kept their options open, made a lot of cautious small bets rather than going all in. They didn't make the iPhone, no, but they placed themselves in a position where they could react to iPhone. By being open to the opportunity and a lot of luck, they essentially became the only choice a monster sized industry had in the face of huge disrupting new competitor.
Google often get slagged for the unfocused, perpetual beta thing. But laser focus is overrated. For example, given the choice of only picking Chrome OS or Android, a laser focused Google would have never gone Android. Overall I think it is much better to admit the future is unknown, and be prepared (especially for a large company with Google-sized resources).
It's more like Google's stumbled onto a gold mine that's already been looted:
Google makes $5-$10 per Android phone, maybe 10% of what it's partners make. That's about the same amount as Microsoft makes off each Android phone and is perhaps 1/50th of what Apple makes off each iphone.
Even worse it turns out that the half empty gold mine is on public land and any crazy old coot can waltz in and start mining themselves:
Android won their "empire" by being the only credible licensed iphone clone in 2009. The real question is whether this empire is going to be of the Han/Roman/Windows variety as so many commentators assume or will it be a short lived dynasty like the Qin/Napoleonic/Netscape variety.
I'll put my money on a Three Kingdoms scenario playing out. Why do I think WP 7 has a ghost of a chance when everyone's done nothing but dismiss them? Let's review:
Android phones started shipping in Fall 08. However they really didn't have any traction until Fall 09 when Verizon started pushing the Droid. And it wasn't until Froyo phones shipped en masse in Summer 2010 where Android started to dominate carrier shops.
In the same way WP7 launched buggy, incomplete and lackluster in late 2010. It had no traction for it's first 3 quarters. Lately though we've seen a mature OS update released on a 2nd generation of phones that were designed for it.
More importantly Microsoft has made no secret of it's desire to buy market share with retail subsidies. And it will certainly be buying this market share at Android's expense. How much they're willing to lose buying this market share isn't clear but if it's anything like the money they've plowed into Bing that's a lot.
"They didn't make the iPhone, no, but they placed themselves in a position where they could react to iPhone."
Exactly. They set themselves up so they could quickly react to disruptive change in the smartphone market. The iPhone happened to be what came along.
Most people don't understand what an impressive accomplishment this is. Let's look at how long it took for some other smartphone competitors to release their response to the iPhone:
Palm took two years (and started over from the ground up).
Microsoft took three years (and still doesn't have traction).
Nokia took took four years (and then threw it away).
RIM still isn't there yet (next year?).
And Google? They took one year. They clearly were doing something right.
BTW, props for remembering Danger. So many people don't in these discussions and (for someone who was working with smartphones back then) it is incredibly frustrating.
Personally owning, several androids in the family as phones and tablets, I am thankful to Google for pushing open source to a proud leader. All manufacturers may freely use it and may offer newer phones. I wish I will be able to play more with Android the way I do with my Linux, as soon as Nexus like devices become commonplace. Thanks Google.
Maybe a silver mine, but definitely not a goldmine. Apple is still taking home the lion's share of the profits in mobile, which the author of the article rather ignores.
It does require a step back to realise the magnitude of change: Google have managed strumble into Microsoft's position in phones.
On the surface, that's both astounding and completely unexpected.
Google put itself into that position by being a neutral 3rd party that manufacturers could trust coupled with a realisation that most phone manufacturers were great at hardware but terrible at software.
The outcome is that the companies who didn't see software as their competency and were willing to drop their OSes (Samsung, Motorola, HTC) have reaped the benefits while companies whose strengths were based around their software being slightly better than their competitors (RIM, Nokia) have fallen behind.
> Google have managed strumble into Microsoft's position in phones.
Yes and no: they have a similar marketshare, but Microsoft had marketshare and money. Google only has the marketshare (and in a limited fashion at that, since implementors "improve the experience" pretty drastically) and get little to no money out of it (likewise for a number of their implementors, too).
And implementors are anything but locked in, as Android holds little software primacy. It does have a lively store, catching onto iOS's, but Android is not "essential", and so far I've not seen any critical software running on android and android only. This means with a little business acumen and some software investment (note that they usually fail at both, but...) most Android implementors can get away from Android pretty fast. And in fact most seem to keep hedging their bets (apart from Moto anyway), either by having WP handsets as well (HTC) or by keeping a ready and used "internal" OS (Samsung's bada)
That's the beauty of Google's spaghetti-at-the-wall approach, isn't it? To me, it's kind of a refreshing, child-like approach to things, with an investigative curiosity and implicit acknowledgment of an ignorance of what will become important.
While I think Larry Page's new focus on focus is great, and I think most of their products are getting better because of it, I do get a bit scared that it comes at the cost of the explorative nature of the company in its youth.
Agree so much. Android is a perfect toy Google has developed to disrupt the established players and stopped a 1984-like future in mobile. Neither Blackberry BES nor Apple's single-device behind a walled garden were for me; and Thanks to Android I have choice.
The thing is, they rigorously weed out non-working ideas and use the time and energy saved to apply extra polish to the working ones.
The result is products that are just about as close to perfect as it is possible to be in an imperfect world.
I see nothing like this sort of selection pressure going on at Google; accordingly, shoddy architectures like Android not only make the cut, but go on to be Really Big Things if they're good enough to accumulate network effects. Kinda like Windows and Office.
I don't think that Android's success is relative to the iPhone- in many ways, it's a greater reflection of the failure of Nokia and, to a lesser extent, Blackberry.
To explain: Apple generally tends to be happy making more expensive, premium products that command a smaller section of the market. They're happy to sacrifice greater market potential to do so- like not allowing carrier customisations, making multiple models, etc. They've compromised this somewhat for the iPhone (they clearly didn't want to have carrier-subsidised handsets originally, for example) but it has worked out for them in a huge way. Still- historically, the ubiquity of the iPhone is in some ways atypical for Apple.
Nokia, on the other hand, has always been more than happy to play ball with the carriers. They should be where Android is now- the ecosystem with a ton of different phone models, carrier-bundled apps, cheap phones and a huge market share. If they had played their cards right Google might still be relegated to teaming up with Apple on mobile. But Nokia left the market wide open- Apple compromised a little to move into the space but Google saw the gap and went for it 100%.
Android is crushing Nokia not because of the cheap phones - but because it can scale from cheap to expensive, from featured to luxury. A cheap Android phone, like LG Optimus One gives you partly the look and feel of an expensive smartphone.
In contrast, Nokia's featured phones with Symbian on them are great for their cost, but they do feel cheap. And an expensive smartphone with Symbian on it still feels cheap.
I don't think that Android's success is
relative to the iPhone
I disagree. The iPhone is probably the biggest reason for Android's success. It first started when Apple decided that an AT&T monopoly was worth it. And it happened in Europe too - in my country only Orange was originally selling iPhones, until iPhone 4 came out.
Like in a bad movie when an old dude sitting on its porch says "a storm is coming" ... carriers and phone makers began freaking out and saw in Android THE alternative. It is a good alternative. And while Apple may have a huge network of stores, it cannot compete with the distribution network of multiple vendors.
I'm not saying that the iPhone is anything other than an unqualified success, but the idea that Apple didn't really want that market share anyway seems a little off.
Apple seemed quite happy to have 70% share or whatever it was with iPods. They've also offered cheaper models whenever they needed to to try and address more of the market -- for example, the iPod Shuffle, or the free-with-contract iPhone 3GS. The Apple TV certainly wasn't priced only to appeal to the high-end market.
I think the article makes quite clear that it is primarily Nokia and RIM that have been devastated, but I don't think it's all inappropriate to look at the way Android has been successful at pulling share away from these companies as something that they have done better at (from a market share standpoint) than Apple.
I don't think that's the whole story. This could also be a PR spin.
Google said later very often they feared an Apple monopoly on the smartphone market and Android is there to prevent it. Also Schmidt hates Microsoft to the bone and is happy about everything that hurts them.
What makes Google appear unfocused is their long time thinking, they don't care if something integrates in another product only 5 years later.
I bet the Google Car and Google Maps integration will be perfect and they also create 3D models of their environment what fits in Google Earth.
Coincidence? I don't think so, these 3 incredible smart guys have all day to think about that.
Imho Android has been successful because, until recently, it had no competition. Android came around at a time when the increasing complexity of building and maintaining a proprietary software stack was forcing handset builders to essentially become software companies. Android gave them the option to return to doing what they did best. Nokia and RIM tried to maintain their own stuff and suffered heavily for it.
I think that Android's success is due to its business model, not the quality of the software itself. The Android team should take care to not become the next Netscape.
1) distribution agreements and good relationships with hardware makers trumps quality - that's how they've beaten Apple and IBM (OS/2 Warp, launched in 1994 was better than Windows 95 and compatible with DOS and Win 16)
2) worse is better, a lesson they themselves took from Unix - timing is more important, you can always improve later
3) operating systems are natural monopolies - if you win the market of low-end PCs and keep growing, you'll eventually take over the whole market
If anything, I fear Google is the next Microsoft. I hope not because I love Android.
Android gave them the option to return to doing what they did best.
Did any of them take that option? The first thing I do when I get a new Android phone is to re-image it with what Google provides. Samsung and HTC have shown that all the hardware makers can do is write crap software to replace the working software they got for free. And then never ever even think about updating it or fixing the bugs.
I wonder how different the market would be had Apple not given AT&T exclusivity. Honestly, I think Android still would have done well, but does anyone think the exclusive deal with AT&T hurt Apple in the long run?
i'm not sure "hurt apple" is the right way to put it, as i see it pretty much everybody who wants (and can afford) an iphone has one. apple hasn't lost anything yet because of the deal.
the exclusivity deal allowed android to gain a foothold, but i don't see android as a competitor to iphone, just an alternative. people who buy android phones are people who don't want an iPhone and probably wouldn't have bought one anyways.
Not a straightforward scenario. Doubtful most other carriers were willing to make the same deal AT&T made at the time (no customization, etc.). People were waiting in line for iPhones to begin with, so they would have to have had different manufacturing, etc. Apple could have probably even released a Cocoa Stack or something to run the iOS ui on any Android phone out there and gobbled up a huge market, but Jobs wanted total control, and seeing Apple's current profitability, it's hard to realistically predict a better move than the ones he made.
FD: Until a couple of weeks ago I owned no Apple products except a very old ipod nano someone gave me years ago. I'm no fan of Apple, but it seems unrealistic to second-guess the success they had for the last decade.
Like someone mentioned above, I do not think it "hurt" them. I think it limited them a little. Think about what it was like before the iPhone came to Verizon. There were a lot of people praying that it would because they simply would/could not make the switch to AT&T. That limited the reach of the iPhone a little. Not everybody is willing to switch their provider just for one phone.
Well, that counterfactual implies a world where the carriers don't have a stranglehold on the market and the ability to cripple or deny service to hardware and software they don't like. In that world Android would be better off as well; phones wouldn't have unremovable bloatware or disabled functionality, and they'd get updates in a timely manner.
Google mantra of do no evil is at the heart of this success again. I really admire that they've kept it open source and not followed their competitors in creating ridiculous policies such as taking a cut of e-book sales, policing for adult content, banning all apps that interact directly with the hardware or try to do things outside of their limited API, etc.
I really hate that motto since it's so good at blinding otherwise intelligent people. It has nothing to do with anything. Google's polices aren't "good" and Apple's aren't "evil". They're both engaging in trade offs. Apple can make sure every user has a nicer experience at the cost of some freedoms. Android offers more freedoms at the cost of some people having ridiculous battery life, trojans stealing people's credit card numbers every so often, etc. Google has taken the exact same trade off that MS took back in their day.
They haven't kept it open source, strictly speaking (ref. Honeycomb). Their naivety has left them dangerously exposed on patents, the recent CarrierIQ debacle is an example of the dangers of Android's openness, and any worthwhile app in the Android Market is hacked and re-submitted as a free app before you can blink an eye. Google's not making money from Android, and neither are developers*. That's not even starting on the security vulnerabilities, or the fact that Google's business model is based on a premise of invasive personal data-slurpage to sell more ads.
Granted, that's a generalization. But it makes the point.
From an IP perspective, do you think Android is legal? From Java, to multi touch, to design aesthetics. Is Google doing to the OS industry to what they did to the news paper and media industry where IP is considered 'obsolete'. And a silent emperor sits over the valley of chaos?
[+] [-] Kylekramer|14 years ago|reply
Google often get slagged for the unfocused, perpetual beta thing. But laser focus is overrated. For example, given the choice of only picking Chrome OS or Android, a laser focused Google would have never gone Android. Overall I think it is much better to admit the future is unknown, and be prepared (especially for a large company with Google-sized resources).
[+] [-] Steko|14 years ago|reply
Google makes $5-$10 per Android phone, maybe 10% of what it's partners make. That's about the same amount as Microsoft makes off each Android phone and is perhaps 1/50th of what Apple makes off each iphone.
Even worse it turns out that the half empty gold mine is on public land and any crazy old coot can waltz in and start mining themselves:
Android won their "empire" by being the only credible licensed iphone clone in 2009. The real question is whether this empire is going to be of the Han/Roman/Windows variety as so many commentators assume or will it be a short lived dynasty like the Qin/Napoleonic/Netscape variety.
I'll put my money on a Three Kingdoms scenario playing out. Why do I think WP 7 has a ghost of a chance when everyone's done nothing but dismiss them? Let's review:
Android phones started shipping in Fall 08. However they really didn't have any traction until Fall 09 when Verizon started pushing the Droid. And it wasn't until Froyo phones shipped en masse in Summer 2010 where Android started to dominate carrier shops.
In the same way WP7 launched buggy, incomplete and lackluster in late 2010. It had no traction for it's first 3 quarters. Lately though we've seen a mature OS update released on a 2nd generation of phones that were designed for it.
More importantly Microsoft has made no secret of it's desire to buy market share with retail subsidies. And it will certainly be buying this market share at Android's expense. How much they're willing to lose buying this market share isn't clear but if it's anything like the money they've plowed into Bing that's a lot.
[+] [-] fpgeek|14 years ago|reply
Exactly. They set themselves up so they could quickly react to disruptive change in the smartphone market. The iPhone happened to be what came along.
Most people don't understand what an impressive accomplishment this is. Let's look at how long it took for some other smartphone competitors to release their response to the iPhone:
Palm took two years (and started over from the ground up). Microsoft took three years (and still doesn't have traction). Nokia took took four years (and then threw it away). RIM still isn't there yet (next year?).
And Google? They took one year. They clearly were doing something right.
BTW, props for remembering Danger. So many people don't in these discussions and (for someone who was working with smartphones back then) it is incredibly frustrating.
[+] [-] rdouble|14 years ago|reply
Android the company was built to sell to a larger company. The acquisition could be attributed to the shrewdness of Android's sales pitch to Google.
[+] [-] diminish|14 years ago|reply
[+] [-] sedev|14 years ago|reply
[+] [-] ethnomusicolog|14 years ago|reply
[+] [-] beatle|14 years ago|reply
Android is the new Nokia. Lots of worthless Market share, Zero profit.
EDIT: I realize i'm going to be down voted for this. But if you don't think it's true, you're delusional.
[+] [-] halo|14 years ago|reply
On the surface, that's both astounding and completely unexpected.
Google put itself into that position by being a neutral 3rd party that manufacturers could trust coupled with a realisation that most phone manufacturers were great at hardware but terrible at software.
The outcome is that the companies who didn't see software as their competency and were willing to drop their OSes (Samsung, Motorola, HTC) have reaped the benefits while companies whose strengths were based around their software being slightly better than their competitors (RIM, Nokia) have fallen behind.
[+] [-] masklinn|14 years ago|reply
Yes and no: they have a similar marketshare, but Microsoft had marketshare and money. Google only has the marketshare (and in a limited fashion at that, since implementors "improve the experience" pretty drastically) and get little to no money out of it (likewise for a number of their implementors, too).
And implementors are anything but locked in, as Android holds little software primacy. It does have a lively store, catching onto iOS's, but Android is not "essential", and so far I've not seen any critical software running on android and android only. This means with a little business acumen and some software investment (note that they usually fail at both, but...) most Android implementors can get away from Android pretty fast. And in fact most seem to keep hedging their bets (apart from Moto anyway), either by having WP handsets as well (HTC) or by keeping a ready and used "internal" OS (Samsung's bada)
[+] [-] joebadmo|14 years ago|reply
While I think Larry Page's new focus on focus is great, and I think most of their products are getting better because of it, I do get a bit scared that it comes at the cost of the explorative nature of the company in its youth.
[+] [-] diminish|14 years ago|reply
[+] [-] bitwize|14 years ago|reply
The thing is, they rigorously weed out non-working ideas and use the time and energy saved to apply extra polish to the working ones.
The result is products that are just about as close to perfect as it is possible to be in an imperfect world.
I see nothing like this sort of selection pressure going on at Google; accordingly, shoddy architectures like Android not only make the cut, but go on to be Really Big Things if they're good enough to accumulate network effects. Kinda like Windows and Office.
[+] [-] rdouble|14 years ago|reply
[+] [-] bluemarc22|14 years ago|reply
[+] [-] untog|14 years ago|reply
To explain: Apple generally tends to be happy making more expensive, premium products that command a smaller section of the market. They're happy to sacrifice greater market potential to do so- like not allowing carrier customisations, making multiple models, etc. They've compromised this somewhat for the iPhone (they clearly didn't want to have carrier-subsidised handsets originally, for example) but it has worked out for them in a huge way. Still- historically, the ubiquity of the iPhone is in some ways atypical for Apple.
Nokia, on the other hand, has always been more than happy to play ball with the carriers. They should be where Android is now- the ecosystem with a ton of different phone models, carrier-bundled apps, cheap phones and a huge market share. If they had played their cards right Google might still be relegated to teaming up with Apple on mobile. But Nokia left the market wide open- Apple compromised a little to move into the space but Google saw the gap and went for it 100%.
[+] [-] bad_user|14 years ago|reply
In contrast, Nokia's featured phones with Symbian on them are great for their cost, but they do feel cheap. And an expensive smartphone with Symbian on it still feels cheap.
I disagree. The iPhone is probably the biggest reason for Android's success. It first started when Apple decided that an AT&T monopoly was worth it. And it happened in Europe too - in my country only Orange was originally selling iPhones, until iPhone 4 came out.Like in a bad movie when an old dude sitting on its porch says "a storm is coming" ... carriers and phone makers began freaking out and saw in Android THE alternative. It is a good alternative. And while Apple may have a huge network of stores, it cannot compete with the distribution network of multiple vendors.
(EDIT: rephrased the last paragraph)
[+] [-] wanorris|14 years ago|reply
Apple seemed quite happy to have 70% share or whatever it was with iPods. They've also offered cheaper models whenever they needed to to try and address more of the market -- for example, the iPod Shuffle, or the free-with-contract iPhone 3GS. The Apple TV certainly wasn't priced only to appeal to the high-end market.
I think the article makes quite clear that it is primarily Nokia and RIM that have been devastated, but I don't think it's all inappropriate to look at the way Android has been successful at pulling share away from these companies as something that they have done better at (from a market share standpoint) than Apple.
[+] [-] sek|14 years ago|reply
What makes Google appear unfocused is their long time thinking, they don't care if something integrates in another product only 5 years later. I bet the Google Car and Google Maps integration will be perfect and they also create 3D models of their environment what fits in Google Earth.
Coincidence? I don't think so, these 3 incredible smart guys have all day to think about that.
[+] [-] inoop|14 years ago|reply
I think that Android's success is due to its business model, not the quality of the software itself. The Android team should take care to not become the next Netscape.
[+] [-] bad_user|14 years ago|reply
1) distribution agreements and good relationships with hardware makers trumps quality - that's how they've beaten Apple and IBM (OS/2 Warp, launched in 1994 was better than Windows 95 and compatible with DOS and Win 16)
2) worse is better, a lesson they themselves took from Unix - timing is more important, you can always improve later
3) operating systems are natural monopolies - if you win the market of low-end PCs and keep growing, you'll eventually take over the whole market
If anything, I fear Google is the next Microsoft. I hope not because I love Android.
[+] [-] jrockway|14 years ago|reply
Did any of them take that option? The first thing I do when I get a new Android phone is to re-image it with what Google provides. Samsung and HTC have shown that all the hardware makers can do is write crap software to replace the working software they got for free. And then never ever even think about updating it or fixing the bugs.
[+] [-] colkassad|14 years ago|reply
[+] [-] notatoad|14 years ago|reply
the exclusivity deal allowed android to gain a foothold, but i don't see android as a competitor to iphone, just an alternative. people who buy android phones are people who don't want an iPhone and probably wouldn't have bought one anyways.
[+] [-] qdog|14 years ago|reply
FD: Until a couple of weeks ago I owned no Apple products except a very old ipod nano someone gave me years ago. I'm no fan of Apple, but it seems unrealistic to second-guess the success they had for the last decade.
[+] [-] Nemisis7654|14 years ago|reply
[+] [-] orangecat|14 years ago|reply
[+] [-] falling|14 years ago|reply
[+] [-] superasn|14 years ago|reply
[+] [-] danssig|14 years ago|reply
[+] [-] Spearchucker|14 years ago|reply
Granted, that's a generalization. But it makes the point.
[+] [-] TechNewb|14 years ago|reply
[+] [-] ceejayoz|14 years ago|reply
Google didn't do much to the newspaper and media industry.
They mostly screwed themselves, with some help from competitors like Craigslist in their profit centers like classifieds.
[+] [-] TechNewb|14 years ago|reply