Tag Archives: Android

What Google gets from Android

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CaptureAndroid doesn’t make much money. In fact, if you regard Google’s Motorola acquisition as part of the company’s Android strategy, then the balance sheet is deep in red ink. Android’s purpose must lie elsewhere.

The obvious, conventional answer is the smartphone-cum-tablet operating system supports Google’s search market dominance. There’s something in this.

Look for something on an Android phone or tablet and you’ll be reaching into Google search, feeding yet more information into the company’s big data mountain and giving Google another opportunity to flog more advertising.

That’s all true. But Google also gets all those things when someone uses their iPhone to search.

Google doesn’t reap the benefits if you make the same search on a Windows Phone 8 device because Bing is the default search engine. I’d argue many Windows 8 tablet users will head to Google first when searching.

Either way, Google owns mobile search. And mobile search is growing faster than desktop search.

However, Google might not have been so strong. Without Android, Microsoft or another search provider could have slipped into the market and filled the vacuum.

In other words, Android is a defensive play to protect Google search, not a product line.

Why fewer publishers support Android

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Slide from Benedict Evans presentation to Google’s ‘Mobile on the Go’ event

If you’re in the publishing business you have two options to reach mobile readers. You can publish direct to the web using HTML or you can build smartphone and tablet apps.

Both approaches allow you to charge for content and to publish advertising.

If you choose the app route, the next step is deciding which devices to support. That’s where it gets tricky.

You’d think raw numbers would decide matters. Yet while Android devices outsell Apple iOS gadgets by two to one, most publishers’ first choice is to build iOS apps.

That’s because Apple users buy stuff, Android users don’t. Or more accurately, Apple users spend so much more on buying apps and content compared with Android users.

It would be madness to adopt an Android-first strategy.

The decision to publish for Android is usually a distant second.

Martin Belam quotes Benedict Evans of Enders Analysis who explains the economics of this.

Most of the Android devices making up that huge market share are low cost phones or tablets. Often Android owners take whatever their phone company offers them in a deal. They don’t care about operating systems – they probably can’t tell you which OS their device is running and they probably barely use any of the functionality.

Only a fraction ever make it to the Google Play app store. If they do get there, they are more likely to choose free apps than paid ones.

Android users typically have a different, less intense relationship with their device than iOS users. This extends to the way they consume content.

Android brand fades as numbers climb

androidHere’s a puzzle. How come Android’s brand is diminishing at the same time the OS now dominates the smartphone sector?

Gartner’s February 2013 smartphone sales report estimate’s Android’s worldwide market share at 70%. That’s more than three times Apple’s iOS which has a 21% market share. Microsoft Windows Phone is on just 3%. 

Android dominates, so why doesn’t Google’s smartphone software command consumer mind share?

The answer is simple. Nobody aspires to buy an Android handset.

Ordinary smartphone buyers don’t chose operating systems, they choose brands. They want an Apple or a Samsung, maybe even an HTC or Nokia.

Only a particularly rare breed of geek would talk of buying an Android.

This is a direct result of the way Google developed Android. The software is open to all comers. Samsung, HTC and the like take the basic Android OS and overlay it with their own software. They do their level best to hide Android from users.

Android was barely mentioned during Samsung’s Galaxy G4 launch. Other smartphone makers do little more than nod at Google when announcing and promoting their products.

Efforts to hide Android stepped up a notch last week when Facebook and HTC took the wraps  off Facebook Home. The software is an overlay that pushes Android even further into the background.

Google’s efforts to protect the Android brand haven’t succeeded. The company bought Motorola and sells Google-branded Nexus phones which are conspicuous by their absence in New Zealand.

It isn’t entirely clear how Google makes money from Android. One theory says an Android user plugged into a Google account using Google apps delivers a steady stream of data to the company that can be mined to sell yet more advertising.

But this doesn’t always apply – certainly not in China where Google is blocked and not on an Android phone running Facebook Home. Maybe those smartphone maker software overlays also block Google’s data collection – or will do in the future.

So here’s another puzzle. If Google isn’t making money from Android, how long will it go on spending large sums of money developing the OS? Might Google unsentimentally drop Android the way it dropped Google Reader?

 

Who challenges Apple’s technology stack: Microsoft or Google?

Technology stacks rated by market share

Microsoft and Google both want to build vertical businesses. They want to follow Apple and own a complete technology stack including hardware, core software and services like app stores and cloud storage.

Who is best placed to join Apple?

Let’s start by looking at the current state of the market for the three companies.

The chart at the top of the page shows the relative position of Apple, Microsoft and Google in the three key personal technology markets. I’ve simplified matters by identifying which company is market leader in each sector.

Microsoft leads the traditional PC market. Apple follows with roughly one tenth of Microsoft’s market share. Google lags in this space. Google’s market share isn’t even one tenth of Apple’s.

Apple is clear leader in tablets

Google’s Android OS commands a smaller market share while Microsoft trails. Things are similar in smartphones despite Android phones outselling iPhones. That’s partly because Apple owns hardware and software while Google’s brand has a lower profile.

Microsoft has its own tablet hardware, while Google has its own-brand phone and PC hardware.

Just to confuse matters, Microsoft earns licence revenue from Android sales. It is possible the company makes more money from Android phones than from Windows Phones.

At first sight it looks like Microsoft and Google are on level-pegging. Yet Microsoft is strongest in the declining traditional PC space while Google is ahead in the fast-growing mobile sectors. At this stage of the analysis it looks as if Google is better placed than Microsoft to build its own Apple-like vertical technology stack. However, there are other matters to consider. We’ll cover them in another post.

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What HP’s Android play tells Microsoft

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HP’s Slate 7 tablet is an Android device

After years of positioning itself as Microsoft’s close partner, HP has climbed into bed with Google. First it delivers a Chromebook, then it announces an Android tablet.

Ray Shaw, writing at iTWire says there’s a message from HP to Microsoft, but that Microsoft doesn’t care about the company’s dalliance with Android.

You could read the company’s move into Google products as telling the world Microsoft no longer sits at the centre of HP’s thinking. That may be a smart given the software giant’s declining influence and cachet.

I read it differently. HP has floundered with consumer products for years. Remember the aborted tablet, the bewildering array of products covering each market niche, often with multiple overlaps?

While the company’s thinking isn’t any clearer today, HP is now making products that at least look interesting. The message to Microsoft and anyone else watching HP is that the hardware giant is still stumbling without a clear, overarching strategy, but the execution is getting better.

The message isn’t so much “get lost Microsoft”, it is more “we’re lost”.

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HP gives tries tablets again

HP-slate-7HP is returning to the tablet game with a low-cost seven-inch Android device. The company’s HP Slate 7 will sell for US$170 – that’s NZ$200. HP says it goes on sale in April.

This is not the first time the troubled computer giant has tried its hand at making tablets, the ill-fated HP TouchPad went on sale briefly in 2011 before being withdrawn. After cutting its price just $99, the devices flew out the door with punters queuing to get their hands on the bargain basement tablets.

The Slate 7 offers two features not seen elsewhere. It has a stainless steel case and features Beats Audio. There’s a 1.6GHz Arm dual-core processor and 3 megapixel camera on the back and smaller camera on the front. HP hasn’t made the screen resolution public yet.

HP appears desperate to have a credible tablet line. Weakness in this area is hurting profits, worse, without decent tablets the company could quickly become irrelevant

Since the company came close to unloading its PC business in late 2011, PC sales have continued to fall with the consumer PC business down a whopping 13%. HP also seems to be keen on supporting a variety of operating systems, has Windows PCs, Chromebooks and now Androids.

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