Wednesday, January 6, 2010

More change


If you haven’t heard, Google has now launched it own phone called the Nexus One. You can read more about it at “Google launches Nexus One 'superphone’" and read an online review from Endgadget. Interestingly, Google is offering this phone directly to customers via its web site, which means you can just buy the handset and insert just about any carrier’s SIM. This is certainly a big change from the way things have been traditionally, yet it is not the only change that this Google phone is likely to create.

The article “Google shows how to trash a business model or three” demonstrates how the Google phone could dramatically affect not only the handset, phone provider and GPS markets but how the operating system that runs on the Nexus One (Android) could end up running in many common household devices. If this is not bad enough for the competition I can think of another major reason why the competition should be running scared.

What would happen if Google offered the phone for free say, in exchange for pushing you advertising? Would you take it? Such a business model really only makes sense for someone like Google and it could potentially blow competitors our of the water. How can they compete with a $0 phone? The phone business is not what’s important to Google, it’s about getting more people connected to the Internet so they view Google Ads, and in that respect it makes sense to subsidize handsets for consumers.

You’d therefore think that it’s also logical for Google to offer free Internet WiFi access to people wouldn’t you? Guess what? They’re already doing that, see “Free WiFi for the holidays”. Do you begin to see how Google is shaking up the market? I certainly do and can only see it only getting rougher for anyone who doesn’t appreciate that (barring an anti-competition suit from the U.S. Department of Justice or the European Union, which is becoming more likely every day now).
 
If you want to start understanding the mind of Google I’d recommend you read “What Would Google Do” by Jeff Jarvis. You can even read in on the Amazon Kindle but maybe soon the Google e-book device.

Given that this year the number of mobile devices accessing the Internet (i.e. mobile phones) will exceed the number of desktop devices (i.e. PC’s), so I’ve heard at least, who stands to benefit the most from this? Perhaps Google and Apple? Who stands to loss the most from this? Perhaps Microsoft? What is Microsoft’s response so far to the threat? Good question. Not having used either alternative to Microsoft’s offering I can only speculate, but having read “What Would Google Do” and know who I’d put money on at this stage.