Last Tuesday, Google finally confirmed it was entering the hardware market by launching its own mobile phone handset. The Nexus One is made to Google’s specifications by HTC, a Taiwanese firm, and runs the latest version of Google’s Android software, an open source operating system already running on a number of handsets, including ones made by HTC and Motorola.
Salivating over a head-to-head contest between Google and Apple, the mainstream news media made as much of it as they could. The BBC even dispatched its technology correspondent, Rory Cellan-Jones, to Google’s HQ, where he dutifully asked if the company thought its new phone would provide competition for Apple’s iPhone. The Google spokesperson waffled, but needn’t have bothered. The truth is that, in most respects, the Google phone is inferior to the Apple product.
That’s not to say that it doesn’t have some nice features: a powerful processor chip, for example; the ability to run more than one application at a time; a nice screen with much higher resolution than that of the iPhone; turn-by-turn navigation (with Street View so that you can see your destination); voice recognition software which — depending on who you talk to — works 90% of the time; etc.
But it also has a relatively small number of downloadable apps and very little memory for storing them; no easy way of transferring music files to the device; and the attractiveness of the high-resolution screen is somewhat dented by the fact that it doesn’t support “multi-touch” interactions in the way the Apple product does. Whatever else the Google phone is, an “iPhone killer” it ain’t.
But perhaps that’s intentional. Despite their tender years, the boys who run Google have consistently shown a good grasp of military strategy, the first law of which is always to decline combat on territory dominated by your enemy and fight only on ground where you have the advantage. That’s why for years Google avoided getting into the PC operating system market — Microsoft’s fiefdom — and concentrated instead on search and networked services, where it was overwhelmingly dominant.
This also explains its cellphone strategy. They recognise that the functional elegance of the iPhone comes from having total control of both the hardware and its software. This kind of integrated mastery, which is Apple’s stock-in-trade, would be difficult to acquire quickly, even for a company as smart as Google.
So they’ve created the software — the Android operating system — then given it away to any handset manufacturer who wants to use it. Google thus effectively arranges that the smartphone market will be flooded by devices which, while not perhaps offering all the functionality of the iPhone, still give consumers more reasons for not buying the Apple device. In that sense, the implicit message of the Nexus One is: “This is what a good non-Apple smartphone could be like; now go forth and multiply.”
This is also implicit in the network strategy Google has devised for the device. You can buy it unlocked for $529 and use it on any mobile network or get it for $179 from T-mobile on a two-year contract. Compare that with the iPhone, which is essentially tethered to contracts with network operators of Apple’s choosing in each of the 94 countries where it’s on offer. If this works, it will mean that the cellphone market will soon have lots of non-Apple smartphones providing their users with internet connections on the move, together with access to location-based advertising and other services.
Google’s nightmare is that Apple might get a dominant grip on the mobile internet and its associated advertising business. This isn’t just paranoia. Last week news broke that Apple is acquiring a mobile advertising outfit called Quattro Wireless for a reported $275-million. So Google’s fears about Steve Jobs & Co are rational, fuelled by the realisation that the days when Apple was just a quirky computer manufacture have long gone; its current market cap ($193-billion) makes it nearly as valuable as Google ($198-billion).
And Apple has been building a substantial cloud-computing infrastructure, including a $1-billion data centre, which is possibly the world’s largest server farm, in North Carolina. The iPhone/Nexus competition is interesting, but is really only a skirmish in what might become an interesting war. – guardian.co.uk