Google & Friends have launched a mobile handset operating system they hope will be in thousands of handsets, starting next year.

If Google had wanted to shake up the wireless world, it certainly found the way to do it. First, Google questioned what it calls the closed nature of operator networks and the devices used on them; even suggesting it might spend $4.6 billion to buy spectrum to use for a nationwide network. Next, it promoted a handset software system it says will level the playing field and make the wireless Internet more widely available.

Eric Schmidt, Google’s chairman and CEO, is well-aware there are more mobile phone users in the world than there are people with a computer. He’s already done a number of deals to get Google applications and services into phones on carrier networks, but Schmidt wants more.

Time will tell if Google will write a check to buy spectrum in January’s 700 MHz FCC auction, but the Internet company is pushing ahead with plans to strike at the heart of the cell phone with a new Linux-based software system. Android is the name of Google’s weapon to bring what Schmidt calls “a whole new mobile experience” to consumers.

Schmidt: Google wants strong mobile presence

Android is being promoted under the aegis of the Open Handset Platform, which includes several carriers (but not the two largest U.S. operators), semiconductor manufacturers, a few handset manufacturers and application and software companies.

It is Linux-based and Google calls it a “very liberal” open source model aimed at defragmenting the handset operating system (OS). Some critics say it further fragments an already fragmented mobile Linux world; however, it could lead to less fragmentation by forcing others out of business.

Handsets based on Android won’t be in the marketplace until mid-2008 or later, but Google already is showing off a couple of prototypes. Sprint and T-Mobile USA are members of the alliance and presumably will use the handsets, as well as carriers like China Mobile, NTT DoCoMo, Telecom Italia and Telefonica.

Ambrosio: Expects millions of Android phones shipping in 2008

Neither AT&T Wireless nor Verizon Wireless have committed themselves to using Android handsets. Verizon Wireless spokesman Jeffrey Nelson says the carrier hasn’t ruled out joining the OHA and shares “the goal of more open mobile application development.” AT&T spokesman Mark Siegel declined to speculate on whether the nation’s largest operator would use Android because the handsets won’t be available for six months or more.

AT&T already supports openness on its network, Siegel says. “We’re focused on delivering a wide array of choices in handsets, content and how that content is accessed by our customers. That is real openness,” he says.

Christopher Ambrosio, director of wireless device strategies at Strategy Analytics, thinks AT&T eventually will sign up with Android because the OS promises to bring compelling applications to lower-priced phones.

DEVELOPER DEALS
One of the questions to be answered before Android phones start selling is how much control carriers will have over how they are used on the network. Google has admitted the phone features could be turned off in some cases.

Other than the fact that Android is Linux-based and Google says it is a complete system with a base OS, middleware and applications layer based on Java, little is known what Google envisions for it. The company has dangled a $10 million carrot in front of developers, promising them rewards for the best Android applications. Its developers’ challenge, which runs until March 3, promises up to $275,000 for the best applications. Those applications won’t have any phones on which to run for several months after the contest closes.

Google has been showing two handset prototypes running Android, one with what appears to be a standard 2.5-inch screen and the other with an iPhone appearance. The handsets have a home screen with direct links to a browser, Google maps, and contacts. The company demonstrated how the contact addresses could be linked directly to a map showing the location, and how a text message would appear directly at the top of the screen.

The larger device included 3D graphics, a browser that opened Web pages just like a desktop browser, a touch interface that allowed the user to navigate around the screen using a finger, and Google’s street view with Google Maps. Another demo showed how a friend-finder application might be built for Android and then linked with a geocaching game.

Android will influence not only the future of mobile Linux handsets but also smartphones running the Symbian and Microsoft Windows Mobile software. It also could impact Apple’s iPhone, which Apple plans to open to software developers next year, as well as RIM’s BlackBerry.

ANDROID PENETRATION
Strategy Analytics is forecasting Android phones could reach 2% of the 210 million total smartphones shipped globally in 2008, which would be 4.2 million phones. That’s a small part of the smartphone market, but still a significant number considering the iPhone isn’t expected to sell that number in its first six months.

Analyst Ambrosio says Symbian, which has about 75% market share, is at the greatest risk if Android takes off. That’s because Symbian has a mass-market appeal, while Windows Mobile and BlackBerry are more focused on the enterprise.

Panagrossi: Symbian’s operating system already open to developers

Jerry Panagrossi, vice president of U.S. operations for Symbian, found it interesting that Google decided to create a new mobile Linux OS instead of aligning with one of the existing forums pursuing that platform.

He says it is too difficult to assess Android’s impact until more is known about it and phones start shipping.

OS COMPETITION
But, Panagrossi says, Symbian has a history of openness since it was founded in 1998. Symbian makes its source code open to all its partners and licensees, he says, and further allows manufacturers to configure the OS to meet their market needs. Symbian also maintains strong security provisions that aren’t present in Linux, he says.

“Based on our analysis, there are some major deficiencies in Linux that you don’t have in Symbian,” he says, adding that there have been more than 165 million Symbian phones shipped for 250-plus networks.

Scott Rockfeld, group product manager for Microsoft’s Mobile Communications business unit, says Windows Mobile already has 18,000 applications available, with 140 different devices on 160 networks. He adds that the cost of the handset OS is just a small part of what an operator or its subscribers need for a good mobile experience, because it has to work within the constraints of different screen sizes, network technologies and applications.

MUDDY WATERS
The open source community itself is divided on what Android will mean for mobile Linux. Some criticized Android for its use of Java as an application interface, while others said Android didn’t seem to be truly open.

Steven Mosher, marketing vice president of the mobile Linux company OpenMoko, says it appears to him that Google’s decision to use the Apache Linux licensing model may restrict how open the platform will be. Apache is a free license that allows developers to make changes to the OS that don’t have to be shared with the developer community, while OpenMoko believes in a general public license (GPL) that requires that changes be shared, he says.

This diagram shows the major components of the Android operating system. At the basic level there is a Linux kernel that includes drivers for such capabilities as the display, keypad, camera, Bluetooth, GPS, and Wi-Fi. Applications are built on top. Source: Google

Mosher admits the Apache vs. GPL debate is a “religious question” within the open-source community but he thinks Android is muddying the mobile Linux waters.

Wind River, a mobile Linux company that is a member of both the Linux Mobile Foundation (LiMo) and the OHA, sees a lessening of fragmentation down the road, according the Jason Whitmire, general manager of the company’s mobile handset business.

Whitmire says he polled a dozen network operators globally and they also said they think Linux will be part of their handset focus in the future. But, he said, they also want there to be less Linux fragmentation. Whitmire believes Android and the LiMo platform will be the primary Linux operating systems, although it may take some time for the market to reach that level of consolidation.

The LiMo Foundation itself issued a statement welcoming Android, and members said in an interview they believe Android and LiMo can co-exist. LiMo has some of the same members, including Motorola and NTT DoCoMo, and expects to have the first release of its operating system by the end of the year, says Morgan Gillis, LiMo’s executive director.

“In broad terms, this is not Linux vs. Linux,” Gillis says. “This is Google vs. Microsoft. This raises the bar in terms of competition for the mobile user experience.”