GPhone Could End Up iPhone’s Competition
08.07.07 - 02:16pm
Last year there was an estimated 1.5 billion in adverts spent in the mobile phone industry. That number is expected to grow to 14 billion by 2011 and Google, master at making money of adverts, wants a huge piece of that action.
Rumors of a “GPhone” made by Google have been circling for some time now and according to a Wall Street Journal Report, there may be one coming out by the end of 2008.
The “GPhone”, as it is being dubbed, would be a very different deal than the iPhone. Google, it would appear, is not interested in making the coolest device on the market but rather getting their software and access to their search engines and thus to their adverts into as many cell phone devices as they can - this is where Google can make the most money.
At the All Things Digital conference in May, Google Chief Executive Eric Schmidt said, “What’s interesting about the ads in the mobile phone is that they are twice as profitable or more than the non-mobile phone ads because they’re more personal.”
Google’s long term goal has been reported as being to eventually have free cell phone service, totally run by ads - think Cable without paying for cable.
This long term goal has many people speculative in that many may not want to listen to an ad before every outgoing call, but then again who wants to pay hundreds and thousands of dollars every year for cell service.
“I don’t know how successful it’s going to be,” commented Jeff Kagan, a telecom analyst from Atlanta, Georgia. “The average adult who can afford a cell phone is not going to want to listen to ads. So this is mainly for teenagers, twenty-somethings, high schoolers or people who can’t afford a phone.”
At the moment though Google is a long ways from this goal and for now must rely on other carriers to carry a Google phone. They are doing this not by creating a revolutionary device but rather partnering with hopefully all carriers who would carry a phone specifically developed to best show off Google’s web browser, search engine and the like.
In order to achieve this they have developed handsets, are partnering with hardware and software manufactures and are offering cell phone carriers partnerships to the carriers to sell and carry a Google based phone with our without the Google name just as long as it has their applications.
Carriers in Europe have been more open to adding the Google applications than carriers in the states. United Kingdom’s Vodafone Group PLC signed a partnership with Google to provide the search bar on the carrier’s branded Internet homepage, with results customized for cellphone users, and T-mobile in Europe integrates Google’s search bar into its welcome screen for users who have a data plan designed for heavy Web browsing.
Here though carriers have given pause largely because they also know just how much money is to be made from mobile web advertising and are loathe to relinquish that to someone else. Verizon recently turned down integrating the Google Web search engine into their phones. “What this really boils down to is a battle for the mobile ad dollar,” said Verizon Wireless chief Executive Mr. McAdam in a recent interview. “They want a disproportionate share of the revenue.”
Google has other ways of getting into the market however, as shown by their interest in purchasing a wireless-spectrum license. They announced that they may bid for the license in an upcoming government auction. This would cost billions and take years to accomplish but in the end it would allow Google to be a phone operator themselves bypassing the carriers if necessary and perhaps achieving Google’s long term goal of free cell service.
For now though Google is keeping mum on the issue only saying, “We are partnering with almost all of the carriers and manufacturers to get Google search and other Google applications onto their devices and networks.”
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