Feeds

Microsoft takes the Android profit, the Wonkas take the pain

What price a Google Zeitgeist invite now?

Providing a secure and efficient Helpdesk

Google’s troubles with Android aren’t just financial. They’re actually much, much worse than that, which all seriously throws the company’s golden reputation for perspicacity into doubt. Why buy into Google’s vision of the future when its own estimation of the present is so deeply flawed?

The fact that Microsoft is reaping all the profit from Android – and Google none – is something even a policy wonk can understand.

With Android, Google charged into a mature industry and refused to play by basic business rules. It then cried foul, rather ungallantly refused to protect its business partners and then, like a spoiled brat, stamped its feet and cried that the system was broken.

This behaviour is simply bizarre – and it has deep consequences. It is perplexing that Google made such poor risk assessments at so many stages of the journey, thinking it didn’t need intellectual property assets, and reckoning it could bluster its way out of trouble, if trouble came along. And it did.

Recall that Google is spending $12bn, and risking upsetting its partners, to buy belated patent protection for its Android licensees by acquiring Motorola Mobility. But Mobility’s IP portfolio wasn’t enough to deter Apple from suing it, and Samsung didn’t show much confidence in it either this week. Rather than wait around, Samsung signed a royalty agreement with Microsoft. Acer, ViewSonic, HTC, and five others also pay Android royalties to Microsoft.

Google could have gone done several established duties to avoid this situation. The licensees liked Android and wanted to use it – free as in beer was not a significant consideration – and it was a powerful rival open platform to Apple.

Google could have performed due diligence, as Nokia did opening up Symbian, to ensure there weren’t any nasty surprises for licensees. It could also have indemnified its licensees, saying "Trust us, we’re your partners; if you’re in trouble, we’ll help you". It could also have charged for Android, aping the complex and opaque system of advances and subsidies well known in the telecoms and PC industries and disguised as “marketing subsidies” by Microsoft and Intel. It shunned all these options.

Kevin the Teenager. Again.

But open-sourcing Symbian was a painstaking task; it took time, 18 months, and required huge commitment from leading vendors including Nokia, who had to clear its own IP. Google didn’t fancy that. Indemnifying its partners meant taking responsibility, something the Children of the Chocolate Factory have never been very good at. And freeconomics was, well, freeconomics. Man.

(As I pointed out recently, it could also have rolled its own funky frameworks: “doing a C#” rather than copying Java and passing it off as its own. The patent system is there to protect originality, particularly when backed by deep pockets).

Instead, it took a shortcut to market, and whistled at the risks.

It’s quite amazing to review this today. Did Google really think that instead of following established business conduct, its network of DC lobbyists, sympathetic media placemen and compliant academics, and ersatz “citizens groups“ could rewrite US law at a moment’s notice? What were they smoking?

It’s unfair to say there’s absolutely nothing in the Android credit column. Android phones are still flying off the shelves. The zero cost approach has seen off Microsoft and Symbian, the two smartphone giants of five years ago; there’s a long-term business advantage to reducing choice. And Android remains a potential space for services Google can, perhaps, monetise in the future. But these are all most definitely intangibles.

Yet Android costs Google billions, without drawing revenue. Microsoft is making half a billion a year from Android. The settlement with Oracle, when it eventually comes, will add even more costs to working with Android – for anyone who dabbled with it.

Google executives must be wondering – in the words of David Byrne – “how did I get here?”

The company is going to have to spend very big to settle a clutch of outstanding IP issues, and almost certainly have to restructure Android governance to restore confidence in its stewardship of the systems. But even after all the smoke has cleared, things at Mountain View will have irrevocably changed. No amount of public relations or lobbying, or invite-only conferences, are going to return Google to the golden status it enjoyed only a few years ago.

Imagine you're a public policy person, or a business strategist. Why would you think Google can give you a glimpse of the future, when it can't even understand the present? ®

Beginner's guide to SSL certificates

More from The Register

next story
Scrapping the Human Rights Act: What about privacy and freedom of expression?
Justice minister's attack to destroy ability to challenge state
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
EU to accuse Ireland of giving Apple an overly peachy tax deal – report
Probe expected to say single-digit rate was unlawful
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
Hey Brit taxpayers. You just spent £4m on Central London ‘innovation playground’
Catapult me a Mojito, I feel an Digital Innovation coming on
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
EU probes Google’s Android omerta again: Talk now, or else
Spill those Android secrets, or we’ll fine you
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.