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Android's Coming-Out Party

Thu, 10/02/2008 - 10:40pm
Brad Smith

T-Mobile’s new Android phone promises openness,
and includes Amazon’s DRM-free music store.

When Jeff Bezos, founder and CEO of Amazon, delivered a keynote address to the CTIA Wireless show eight years ago, he envisioned a wireless Internet where consumers would buy books from him using Android's Coming-Out Partytheir mobile phones. That’s possible these days, but there isn’t a lot of evidence m-commerce contributes much to Amazon’s $4 billion quarterly sales.

Bezos is still making deals with wireless companies, though, most recently becoming the music store for the first Android phone, T-Mobile USA’s G1. Amazon’s MP3 music store is pre-loaded on the HTC-made handset, which the operator will start selling Oct. 22 for $179 with a 2-year voice and data plan.

Besides Amazon’s music store, the G1 has a number of tightly integrated Google applications, which is no surprise given Google is behind the open-source Android OS. The touchscreen phone with a slide-out QWERTY keyboard also has easy access to Google Maps Street View, Gmail and YouTube. It also has Wi-Fi, GPS, Bluetooth, an applications store, and a 3-megapixel camera.

The G1 has gotten mixed reviews so far, with high marks for the number of applications it contains and its openness. Reviewers haven’t been as excited by its design, described by one as “clunky.”

CHALLENGE TO IPHONE?
The addition of the Amazon music store might appear to be a challenge to Apple’s iPhone, the device to which the G1 is most often compared. Amazon launched the store a year ago and said it now offers 6 million DRM-free MP3 songs from all four major music labels plus thousands of independent labels.

Bill Carr, vice president of Amazon.com’s Digital Music and Video unit, said the G1 will put the company’s music at the “fingertips of even more customers in more places,” which is sort of the dream Bezos had for books in 2000.

Music downloads with the G1 can only be done using a Wi-Fi connection, but the carrier and Amazon said subscribers can use the T-Mobile network to search, browse, listen to and buy MP3 songs. After buying the songs, users can download them via Wi-Fi and then play them on the G1 or any other MP3-capable device, including PCs.

Forrester Research analyst Charles Golvin said Amazon stands to gain more than T-Mobile from the deal, although he said he’s not privy to the business arrangement. A mobile music store is a must-have for carriers, he said, while whatever traction the G1 gets will serve to expand Amazon’s audience.

Google is probably happy with the Amazon G1 arrangement, Golvin said, because it will help Google sell more advertising.

HANDSETS
Analysts have forecast that T-Mobile will sell between 200,000 and 400,000 G1s this year, with that number ramping up in 2009 when the HTC phone goes on sale through T-Mobile’s European cousins. The phone hits the British market in November, with widespread European sales in early 2009.

Rich Miner, Google’s mobile platforms chief, has said only that there would be at least one Android phone on sale this year, with multiple handsets from other handset manufacturers in 2009. Other OEMs that have joined the Android Open Handset Alliance include LG, Motorola and Samsung. Sony Ericsson also has said it is studying the Android platform.

Along with T-Mobile, Sprint Nextel also is an OHA member. Golvin said he expects Sprint may have an Android phone on its CDMA network before Christmas.

Golvin also said he did not think the G1 by itself is a “game-changer” but that the Android platform generally could grab a 10% market share among high-end devices over the next few years. That’s because of the potential of an open system that allows any OEM or developer to use the OS for free. He said T-Mobile told him there would be no restrictions on the use of the G1, other than it is SIM locked.

One of the factors in Android’s uptake in the market is that T-Mobile is the smallest nationwide carrier, with 31.5 million subscribers, and is just now building out its 3G network. T-Mobile officials admitted the G1 will provide a good experience for subscribers only on its 3G network, which will be available in 22 cities when the phone launches, according to Cole Brodman, chief technology and innovation officer for the carrier.

But Craig Wigginton, head of Deloitte’s telecommunications practice, said the T-Mobile launch could be a good thing for both Android and the carrier. He said T-Mobile’s market size could provide a litmus test for the device and its applications. Assuming the device sells successfully, and Wigginton said he thinks Google will do whatever it can do ensure that, then other carriers in the United States and elsewhere will be encouraged to use the platform.

“What will drive carrier appetites will be customer response,” he said. If subscribers buy the G1 and application developers design compelling applications for it, carriers like Verizon Wireless and AT&T might find it difficult to say no, Wigginton said.

That would be music to the ears of Amazon’s Bezos, as well as for Google.

Android’s Unveiling

It isn’t exactly big news since word had leaked out more than a week earlier, but T-Mobile USA organized a news conference in New York City for Tuesday, Sept. 23, to formally announce the first Android phone.

Called the Dream in FCC filings, the first Android phone is made by HTC. The phone will likely go on sale Oct. 20, although T-Mobile USA hasn’t confirmed that date. The phone has a touchscreen which appears to be larger than Apple’s iPhone, plus GPS, Wi-Fi and will use T-Mobile USA’s new 3G network.

HTC Dream HandsetJoel Espelien, strategy vice president for OHA member PacketVideo, told Forbes the Dream will process fun applications faster than any phone on the market because the operating system was built as a multitasking workhorse from the start. Other phone operating systems (OS) use older technology that slows them down, he said.

OHA members include other handset manufacturers beside HTC, including Motorola, Samsung and LG, so more Android phones are in the pipeline. Sony Ericsson, although not an original member, also reportedly is looking at Android. If true, Nokia would be the only one of the top five handset OEMs not using the OS.

ROYALTY FREE
What has garnered so much attention for Android, besides being pushed by Google, is that the OS is being offered free of royalties. The members promise true openness to any developer, with a fully integrated mobile software stack that includes the OS, middleware, a user-friendly interface and applications.

Rich Miner
Miner: Expects multiple handsets next year.

Although some critics have said Android is late, the OHA and Google have only said the first phones would arrive in the second half of 2008. Rich Miner, Google’s mobile platforms chief, told Wireless Week only that there would be “at least one” Android phone by the end of the year and that there would be multiple handsets in 2009.

Miner said the first Android phone will be tightly integrated with some Google applications but that future models may not be. Google does not want the phone known as the G-Phone, nor the applications to be only Google, he said.

Miner said there have been more than 1 million downloads of the Android SDK since it was made available earlier this year.

Asked if Google’s new Chrome browser would be part of the handset, Miner would say only that Chrome and the Android browser both leverage the open-source WebKit browser.

Android will make location-based services easier to use than traditional phones, Miner said, because location will be integrated with other applications in the phone. One example is that the contact addresses in the phone can be mapped on the Android phone using Google Mobile Maps.

 

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