HTC, Samsung take Android to the brink

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Seamus White, Granite Digital, and Ivan Adriel

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15 September 2011 | 0

Last week I wrote about the bloodless tablet space and how Android proliferation was creating a ‘me too’ approach by manufacturers. The demise of HP’s TouchPad and Pre3 signalling the end of the webOS platform; RIM’s Blackberry PlayBook and its QNX system about to go the same way following a substantial price cut; and Intel’s MeeGo yet to get any kind of release, have shrunk the market to a straight choice between iOS and identical implementations of Android 3.1 Honeycomb.

Thankfully two developments will change the status quo. Microsoft’s Build conference this week in Anaheim, California, saw the developer release of the touch-optimised Windows 8 PC operating system (OS). Amazon’s forthcoming contribution has also piqued the interest of analysts – if only because no one has a clue what it will be like.

Diversity
But enough about tablets, Android and Apple’s main battleground, smartphones, is about to get a lot more diverse. Should Google’s acquisition of Motorola’s personal devices business pass international regulators, Android’s safe harbour could turn into a prison should manufacturing partners decide to explore other options.

Google’s troubles with patent infringements in Android could see it having to pay millions to Oracle over the use of the programming language Java. The fallout could force Google pay a licence fee to Oracle, a cost that could be absorbed by digging into Android Market revenue or passed along to manufacturers.

 

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When the Google/Motorola deal was announced we speculated that the deal could create a lab space for Google to try out new ideas and act as a fallback should relations with partners like HTC and Samsung deteriorate. Do manufacturers care enough about Android to take a hit on a licence so Google can make money from the Android Market?

As the market’s indifferent response to Nokia’s current line of Symbian smartphones (the N and C ranges) proves, user experience is as important as hardware. If Android goes from a free to a paid-for commodity, however, shouldn’t its partners dabble in improving on it on their own terms? So they are – or are threatening to.

This week HTC announced it was looking into its own mobile OS. Given that HTC has been instrumental in bringing Android to market, the prospect of it withdrawing support would limit Google’s reach in Europe where Motorola has but a token presence.

Similarly Samsung, Apple’s biggest competitor in smartphones, has said it is exploring its options, hinting that it might roll out its Bada platform, already popular in the Far East. Unimpressed with Windows Phone 7’s 1% market share (and $15 licence fee per handset), Samsung has promised to support Microsoft until the end of 2012. The same brinksmanship could apply to a licensed Android.

Marketable
For consumers this is good news. There will be far greater choice in smartphones, with more options in hardware, software and apps. Android’s commanding 47% market share will shrink as its strategy of diffusing the software across manufacturers turns ‘partners’ into ‘fairweather friends’. After all, why should you pay for an OS that is largely a portal to a software market from which the manufacturer receives no cut. As Blackberry and Nokia have found to their cost, app stores are a reflection of market sentiment. Google cannot afford to have developers look elsewhere, and that means keeping Samsung, HTC et al on side. It has no choice but to absorb the cost and keep Android free.

But there is a compromise. If Android is to maintain its profitability manufacturers must be given the option to run whatever software they like, but make their platforms compatible with apps from Android Market – or at least have something in place to make them portable at minimal cost. If Google truly believes in open technologies it will have to cede what little control they claim to have over the market.

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