MoneyWatch Tech

Google's Plan for Android Will Drive Mobile Carriers Nuts

By Erik Sherman

Updated on: March 31, 2010 / 11:43 AM EDT / MoneyWatch

One common comment about Google's (GOOG) mobile phone operating system Android is that it's "fragmented." That's a fancy way of saying that there are so many versions on various devices from different vendors, each deciding on its own hardware and software configuration, your eyes could cross trying to figure out whether you're about to get the latest and greatest. Google finally listened to complaints and has an answer ... one that will tick off wireless carriers and make handset vendors strongly consider using Symbian or Microsoft (MSFT) Windows Phone 7.

According to Engadget, Google will break out many standard Android applications and components and make them optional and available by download. There are some solid benefits to such an approach, because Google's standard software development method of incremental releases has been a problem. Currently, Google has four different versions of Android -- 1.5, 1.6, 2.0, and 2.1-- shipping on either one company's handset or another. Consumers expect that a new phone will be the latest and greatest, but can't track what they're getting. Download the new components and the customers will always be up-to-date.

Sounds good, right? Not so fast. This will be an expensive logistical nightmare that will make carriers and handset vendors wish that they had licensed anything else:

Google purportedly would build this capability into Android over the next two releases. Everyone say it altogether now: That will make six versions of Android out in the world. To fix the problem, Google will make it worse.
Another ramification of spreading the fix over two versions is that Google does nothing for old versions. Fragmentation continues unabated for a considerable time.
What is the common wailing that we've been hearing from such carriers as AT&T (T) and Verizon (VZ)? Crazy consumers think that unlimited data plans mean they should be allowed to have unlimited mobile data use. Given how often Google updates software and how rapidly Android is gaining consumer adoption, how much data will users pull down over the network? Tons. And they thought apps were a pain.

Now put logistics aside and take up the biggest problem for carriers and handset vendors. When consumers can upgrade functions without changing hardware, they're less likely to want new devices. Unfortunately, hardware vendors make money by selling new phones and carriers use new devices at subsidized prices to lock consumers into their accounts and keep them from straying to a competitor.

I think it's time for Google CEO Eric Schmidt to ask WWSJD â€" what would Steve Jobs do? Critics snipe that Apple tightly controls its hardware and limits consumer choice, and both charges are true. But the upside is that Apple's products function as part of a well-integrated ecosystem that delivers a simple and consistent user experience. Jobs also comes out with new iPhones at greater intervals, so people spend money for upgrades. There's a lot to be said for a proven business model -- even when your company doesn't need to make money off the phone sale. However, your business partners do.

Image: RGBStock.com user sritenou, site standard license.