Google Phone

Scant seconds after the rumor breaks that Google will be announcing their gPhone OS and application suite within two weeks, comes the suggestion that talks with mobile operators in the US are in far more advanced stages than previously believed.  Key, indeed, is the revelation - as usual, by “people familiar with the matter” - that both Verizon and Sprint are close to formulating a deal with Google for gPhone-powered handsets to utilise their networks.

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Someone, somewhere, just wound up a big spring in Google: if the Wall Street Journal are to be believed then within the next two weeks we’ll be hearing an announcement about a Google-developed suite of software and services which manufacturers can use to release Google Phones.  While spokespeople from the search giant declined to comment, sources close to them revealed that deals are likely to include LG and HTC, while involved carriers mentioned were T-Mobile USA, France’s Orange and the UK’s 3 network. 

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It’s taken a little while, but Microsoft has finally thrown its oar in to the 700MHz spectrum auction furore, but for anybody expecting a sweeping “we could do that best” arrogance oft attributed to the Seattle software giant you may be surprised.  At CTIA this week, Steve Ballmer - who could never be accused of being less than enthusiastic about Microsoft’s capabilities - set the record straight about the company’s plans to sit back and observe the auction rather than wade in with an open wallet.

“No, we don’t have plans to participate in the spectrum auction.  We may be broader in what we do than any company, but we have a core competency. And we think the telecom industry has a core competency. It takes a real expertise to set up networks, to invest in capital expenditures, to provide customer service 24/7—that is a core competency. What would it buy us to own a piece of the spectrum? It would probably alienate us”Steve Ballmer, Microsoft CEO

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With Google’s acquisition of Jaiku, a Finnish company which owns a number of patents related to SMS text messaging, analysts are clamouring to add this latest string to their vision of how an eventual gPhone and accompanying service may look.  There might be something about the relative low-tech of plain old SMS, however, that’s prompted some uninspiring ideas - compared to the network toting, OS creating behemoth we’re used to hearing suggested, Indystar’s report manages to make Google look like just another information portal.

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Might Google’s interest in the 700MHz spectrum be as a means to establish a data cloud for the new generation of internet appliances?  Nicholas Carr’s prediction piece - on the potential of a partnership between Google and Apple producing OS X-based relatively closed-system computers that rely on the search company’s background mainframes to store and backup data - puts a fresh potential spin on the upcoming auction.

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That Google and HTC have been in bed with each otherover the development of pre-production gPhone handsets is nothing new; what does come as a surprise is that, according to analysts at UBS, the manufacturer will ship an estimated 50,000 handsets using their own hardware design and Google’s new cellphone OS by the end of the year.  Intended for developers, who will undoubtedly be keen to figure out how to best code for what’s believed to be a Linux-based environment, it does herald the availability of a production version that should appear in stores sometime 2008.

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Something is afoot.  The FCC has delayed the 700MHz auction [pdf link] from its original January 16th date so that prospective participants have extra time to “develop business plans, assess market conditions and evaluate the availability of equipment.”  Thing is, they’re postponing it for a grand total of eight days, with the auction now taking place on January 24th.

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Just as happened with the iPhone, the prophesied Google cellphone is causing pre-emptive waves across newsrooms and blogs as various agencies sift through the scant evidence and clamour to have their say.  Today it’s the turn of the New York Times, who are keen to differentiate between the “revolutionary” and “customer experience redefining” iPhone and Google’s potential next-step into the mobile marketplace.

No longer is this step a rumour; it’s become a matter of when and not if.  NYT’s Miguel Helft is quick to label the search giant’s intent: using mobile ads to broaden their market share.  If anything, Helft makes it sound like, where Apple planned a revolution in the cellphone industry, Google aren’t particularly bothered what industry they’re entering, just as long as it caters to their role as advert and search provider.

“Google wants to extend its dominance of online advertising to the mobile Internet, a small market today, but one that is expected to grow rapidly. It hopes to persuade wireless carriers and mobile phone makers to offer phones based on its software” Miguel Helft, NYT

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We’ve already talked about the potential impact ad-revenue funded cellphone contracts could have on an industry built around high-return tariffs and costly add-ons, but Business Week are next up to cast a speculative eye over the possibility of a rival network in which customers swap their own attention for those all important bundled minutes.

Key to the concept - and you just know it’s Google that’s fingered as having the background and wherewithal to handle such a monumental task (and make people love it) - is tailored advertising.

Business Week points to existing, far smaller scale endeavours such as Blyk in the UK or Virgin Mobile’s “Sugar Mama”, both of which give free network time to consumers willing to receive ads from marketing partners; they also highlight Google’s capacity to turn even this opening gambit upside down, leveraging their integration of search, geographical location and historical interest to massively focus specific messages that are correct for time, place and - most importantly - functionality present on a mobile device.

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The old saying that friends shouldn’t discuss politics has long had a tech-themed cousin; talking about the “perfect” gadget, of any sort, is likely to result in disagreement, and maybe (with the exception of the Apple vs. Microsoft debate) the greatest furore is over the gadget most of us keep with us most of the time: the cellphone. Information Week tempts fate, then, and asks what exactly makes the perfect mobile, ladling a little Google love into the mixture.

The search giant’s potential strength in this area, of course, is twofold: firstly, their catalogue of web-based apps, and secondly their apparent willingness to step outside of the norm and challenge the status quo of the traditional telcos:

“That’s not to say that the likes of Nokia, Motorola, and RIM aren’t innovating. They are, but they’re working within the system rather than trying to fundamentally alter the way the business works” Information Week

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