Can Google pull it Off — is the question worth asking when realizing the search leader is looking to open up the mobile phone industry. The cellular market is legendary in its ability to lock in customers. In the US the phones are subsidized and locked. In Europe the phones are unlocked but when you go from country to country your rates skyrocket.
In the US the situation is even more interesting as carriers typically cripple devices making them less useful. The goal generally is to drive more network minutes. For example, try sending a photo via bluetooth on a Verizon Wireless phone.
So when Google announced it is working with 34 handset makers, wireless carriers and technology companies to create low-cost mobile phones based on open standards, you have to wonder who they are working with and who would want to work with them.
After all, the wireless carriers control everything in this business – why would they want to open anything up? Amol Sharma hints at this in his Wall Street Journal article when he mentions Verizon Wireless and AT&T are missing from this alliance.
But still, many others in the industry are working with the company behind the world’s largest search engine and the reason is likely because Google has so much pull. Betting against this company has got to be scary.
But then again, Verizon told Steve Jobs to jump in a lake when given the opportunity to carry the iPhone, I would imagine they aren’t too concerned to hurt Google’s feelings as well.
So how will this initiative be paid for you ask? Advertising of course. Google will subsidize much of the development costs through ads delivered through mobile devices.
Then again, I am sure Verizon, AT&T and others aren’t too keen on sharing this ad revenue with the search juggernaut. I am sure they aren’t fans of open standards either. The question is how much pull will this device have with consumers. Will it be very useful? Will everyone want to have one? If so, the mobile carriers may be in quite a pickle. It will worth watching how this proceeds very closely.