It was announced today in the Financial Times that Google and Android agreed to join forces using Android as a platform for wireless apps. The FT reports:
"Eric Schmidt, Google chief executive, said that there were now nine Android devices available in 26 countries with 32 carriers. There were also more than 10,000 applications available from the Android Market – Google’s version of Apple’s App Store....“Everybody knows that Verizon’s network is the best in the US by far, with their reach and performance,” Mr Schmidt said...Lowell McAdam, Verizon Wireless chief executive, said the two would co-develop smartphones, PDAs, netbooks and “other specialty devices”.
However it still leaves open the question as to what the business model is. If it is as we have been stating that of an electronic shopping mall, then who owns the mall; the network operator or the operating system provider. This is not akin to Microsoft and the PC. Verizon brings the customers, it owns the mall. The risk to Verizon is a takeover by Google, and the risk to Google is the fungible nature of the service.
We have argued before and we continue to do so that the value is the shopping mall operator function. However ambiguity in the market positioning can be deadly to both parties and we believe there is an inherent conflict.
"Eric Schmidt, Google chief executive, said that there were now nine Android devices available in 26 countries with 32 carriers. There were also more than 10,000 applications available from the Android Market – Google’s version of Apple’s App Store....“Everybody knows that Verizon’s network is the best in the US by far, with their reach and performance,” Mr Schmidt said...Lowell McAdam, Verizon Wireless chief executive, said the two would co-develop smartphones, PDAs, netbooks and “other specialty devices”.
However it still leaves open the question as to what the business model is. If it is as we have been stating that of an electronic shopping mall, then who owns the mall; the network operator or the operating system provider. This is not akin to Microsoft and the PC. Verizon brings the customers, it owns the mall. The risk to Verizon is a takeover by Google, and the risk to Google is the fungible nature of the service.
We have argued before and we continue to do so that the value is the shopping mall operator function. However ambiguity in the market positioning can be deadly to both parties and we believe there is an inherent conflict.
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