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Can Android Blow Wireless Industry Wide Open?

By Renay San Miguel LinuxInsider ECT News Network
Oct 13, 2008 9:30 AM PT

A research report is throwing more fuel on the prerelease fire surrounding T-Mobile's G1 phone using Google's Android open source operating system. "Success for Android has Little to Do with User Acceptance," claims the ABI Research headline, and director Kevin Burden writes that Android can help sell a lot of smartphones only if carriers and manufacturers "recognize the value to their own business models of using standard platforms."

Can Android Blow Wireless Industry Wide Open?

Wall Street may be adding its own caveat to the report: Android can have a major impact only if shrinking budgets don't force changes in plans for both the industry and its customers.

Right now HTC is the only original equipment manufacturer (OEM) committed to Android, with T-Mobile the only carrier, and the G1 phone finally gets into the hands of eager early adopters Oct. 22.

ABI did not return calls from LinuxInsider.

Wait for the Phone First

The evidence isn't in yet regarding Android's possibility of setting the smartphone standard.

"Let's take away all the marketing hype and take a deep breath and let it all out," Ramon Llamas, IDC senior research analyst told LinuxInsider. "It's the next iPhone, the next BlackBerry -- it's one phone on one carrier right now, does that sound familiar to you? It may carry the [Google] brand and everything, but for most people in the universe, they haven't even touched this darn thing yet."

"It's way too early to tell," said independent telecommunications analyst Jeff Kagan, who has had an opportunity to check out the G1. "It's cool, it's great, it's definitely good software and definitely worth looking at, but it's not that different from the iPhone. They both basically do the same thing."

T-Mobile recently announced that it would be tripling its original order for G1s, and on Monday the Motley Fool estimated that means T-Mobile will sell about 1.5 million G1s out of the gate.

However, the Week from Hell for Wall Street and the economy that was last week could put a damper on sales, Llamas said. Economic woes may make it harder to pry OEMs away from their existing proprietary software and take a chance on Android, even if the potential advantages of open source maintenance and developer improvements could help lower costs in the long run.

"It takes a lot of cost in supporting multi-platforms," Llamas said. "That's going to be on a lot of people's radars. T-Mobile would like to make money off of this, but they're staring at this 'gift horse' and saying how much cost can we weather and how much do customers want this? Knowing that the holiday season is coming but the economy is down, do we stay at this price or do we move it?"

Competitors Waiting for Android

The Apple iPhone's stripped-down version of the Mac OS X and BlackBerry's operating system are all closed, as is the Nokia-Symbian ecosystem, but Apple's new App Store is breathing life into its developer community, and Research In Motion has promised to pay more attention to its own third-party software providers. Microsoft's Windows Mobile 6.1 is supported by several OEMs and carriers and has an advantage in the enterprise, but an OS update is still a year away. This is the current smartphone environment that Android will find itself competing in when the phones go live in late October.

"Google's got a name, but it's just a name," Kagan said. "Google is great at what they do online and with search, but all these other businesses they get into, they're just not as successful as search. The smartphone category is the fastest-growing category in cell phones right now, that's why everybody is focused like a laser beam on this right now, why everybody wants in and why everybody would love to be the favorite."

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