October 12th, 2009
Why the big Android bandwagon?
We have had open source mobile platforms for years. Why has Android become a bandwagon, one big enough that people are wondering if it’s not growing too big for its britches.
One word: marketing.
Thanks to its low-cost structure, Google can subsidize the marketing of its products to a degree even experienced rivals can’t match. As I have said before there is a price lower than free, and Google is uniquely positioned to pay that price.
Why? Look at the ad above, for the HTC myTouch, from Vimeo. All those celebrities aren’t just selling T-Mobile, or HTC. They are also selling Google. Android gave Google an excuse to do TV ads, with others’ help. Even if it doesn’t sell phones it sells the Google brand, and Google benefits from that.
It’s all about the sharing. By spreading the development effort through open source, Google also spreads the marketing cost as various players vie for position. But Google’s size and budget are what make this a good deal for everyone else.
Symbian and RIM can’t pay this price to the degree Google can. Symbian was spun-out to become self-sustaining, and its developer outreach efforts may be all it can do. RIM has a proprietary background, and proprietary profits, so for it to grab open source may easily be seen as desperation.
Google has both the money and the reputation to push product through the channel that has its roots in open source. Its multiplicity of developers means all of them have an incentive to drive down the open source incline and the open source development incline.
Google may eventually seek to monetize all this with online services, but it is developing the market before showing its hand in that area. Meanwhile, the ad revenue from having Web pages appear on more mobile kit is all it really needs. (Yes, this means the iPhone is subsidizing Android.)
Google’s cost structure gives it the power to be patient, something no other market player has. The Android bandwagon is built on this patience.
To succeed, however, it will have to deliver products as good or better than the iPhone, at the same or less cost, with just as many apps. That risk to its reputation is all Google is laying on the line here, but since failure will also hurt open source that risk is also shared.
Dana Blankenhorn has been a business journalist for 30 years, a tech freelancer since 1983. You can follow Dana on Twitter. See his full profile and disclosure of his industry affiliations.
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