Will Google’s G-phone hit the spot for investors?


29 Nov 2007

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Did you ever wonder what it was like to live in truly exciting times? The fact is you do, but often the history books make you believe otherwise. Books and movies fill our imagination on everything from the Renaissance in Florence, the invention of the printing press, the Roaring Twenties, the Swinging Sixties…

What will the history books say about now? This is a strange time when titans in tennis shoes and polo shirts clash over intelligent empires of media and technology in one dimension of our world, while in another wars are fought over natural resources in countries whose infrastructures have scarcely evolved since biblical times.

In the polished steel and chrome world of technology, the battlefield has evolved from desktop computers to the internet and gaming consoles and now back to the mobile device.

Having saturated the developed world with mobile devices, phone giants are focused on two things: opening up the developing world markets to replenish falling device sales as well as selling premium products like the Apple iPhone and the Nokia N95 to cash-rich consumers to boost profits.

Having sort of conquered in its profession to “manage the world’s information” search giant Google has now staked its claim on the mobile device world and it may not be to everyone’s taste. It will certainly step on the toes of players ranging from software giant Microsoft, phone maker Nokia and even Apple with its much-hyped iPhone.

The newly forged Open Handset Alliance, codenamed Android, comprises Google along with T-Mobile, HTC, Qualcomm, Motorola and China Mobile to name but a few.

The aim of Android is to develop technologies that will lower the cost of developing and distributing mobile devices and services. It will create a ‘mobile software stack’ that will consist of an operating system, middleware, user-friendly interface and applications.

According to analyst firm iSuppli, Google’s goal is to become the main provider of location-based services and mobile advertising on mobile handsets, replicating the success of internet advertising on PCs and location services like Google Earth.

iSuppli forecasts that the advertising portion of worldwide mobile video revenue will rise to US$3.8bn in 2011, up from just US$135m today.

The most significant aspect of Android is the fact that Google intends to offer the software to mobile handset OEMs for free, or close to free. This represents an alternative to Windows Mobile, Symbian and various flavours of Linux.

“The implication of this is that it short circuits an incumbent node in the value chain, potentially decreasing consumer prices for such high-end devices,” said Francis Sideco, senior analyst, wireless communication, for iSuppli.

“However, it also cannibalises a relatively lucrative revenue stream for operating system suppliers,” Sideco added.

The race to create compelling applications for mobile phones is finally under way and this spells good news for Irish companies – of whom there are many – who are developing software for mobile devices.

These include companies like Anam, which makes mobile messaging products, Aran Technologies, which makes customer experience technologies, and NewBay, which makes blogging software.

Indicative of the pace at which the mobile web is evolving, Vodafone and Nokia recently joined forces to launch an integrated suite of Web 2.0 services combining Vodafone’s network with Nokia’s Ovi social network and content services on a range of Nokia handsets.

As part of the agreement with Nokia, Vodafone will get first sight of substantial new services and go-to-market propositions developed within Ovi, which means ‘door’ in Finnish. Nokia says the two companies will make it easier for users to access the internet and online services at a touch of a button.

By John Kennedy

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