Nokia's non-Android Android phone

At Mobile World Congress Monday in Barcelona, Nokia introduced its Nokia X series — three hybrid quasi-Android phones. The phones combine the Android kernel with Windows-style tiles.

The Nokia phones are as much (or little) Android as is Amazon’s Kindle. Like Amazon, Nokia eschewed Google’s proprietary layers and added its own proprietary layers on top of the Android Open Source Project. The new phones have Nokia’s Store, with Nokia’s maps, radio and in-app payments.

According to Nokia

Nokia Store testing has shown that approximately 75% of Android apps will run properly without any modifications; they’re ready to be published in Nokia Store.

For the remainder:

If your app uses Google services for push notifications, maps or in-app payments, you’ll need to make a few changes, but it won’t take long (usually less than 8 hours). Nokia services have been designed to minimize porting effort from apps using corresponding Google services and allow developers develop and distribute a single APK targeting multiple stores.

Nokia even offers a service for testing apps to see if they are compatible. If not, Nokia is doing a road tour (the “Nokia X Porting Bus”) across Europe to help developers to port their apps to provide dual-platform support.

Either way, developers will need to submit their apps to the Nokia Store to have them made available to customers.

The news sites are speculating about how Microsoft feels about this signal undercutting Nokia’s devotion to the Windows platform, in anticipation of the handset business being swallowed by Microsoft.

Microsoft can keep or cancel the platform once it takes control. In the meantime, Nokia and Android developers can attempt a low-cost experiment to see whether app makers will pay the porting costs, and whether Nokia’s hardware competencies are valuable for Android customers in third world countries. Still, it’s hard to imagine a scenario under which this platform is still available for sale in three years.

For me, what is most interesting is what this experiment means for the future of non-Android Android devices. The Nook was first, then the Kindle. Will this encourage other experiments? Will these experiments create a demand for non-Google Android devices? Will developers make dual-platform applications? Will it undercut the market power of the Android compatibility program?

So will this reduce Google’s control of the platform by moving demand to lower layers? Will it promote further dominance by Android? Or will it be the tree that falls in the forest, that no one ever hears?

In the real world, Android is a proprietary platform

Since Android was first released, many of us have wondered how open it really is. Last week, we learned more about Google’s tight control over Android through documents released as part of an European antitrust investigation.

The story was first reported by the Wall Street Journal, based on an analysis by Harvard professor Ben Edelman. (The WSJ said that Google declined to comment). The meat of the revelation were copies of the 2011-2012 “Mobile Application Distribution Agreement” (MADA) that was signed by Android licensees Samsung and HTC. The agreements were exhibits in the Google-Oracle (née Sun Microsystems) Java copyright lawsuit in the Federal District of Northern California.

Ties That Bind

Rolfe Winkler of the WSJ summarized the (MADA) agreements as follows:

The Samsung and HTC agreements specify a dozen Google applications that must be "preinstalled" on the devices, that Google Search be set as the default search provider, and that Search and the Play Store appear "immediately adjacent" to the home screen, while other Google apps appear no more than one screen swipe away.

The terms put rival mobile apps, like AOL Inc.'s MapQuest and Microsoft Corp.'s Bing search, at a disadvantage on most Android devices. Mr. Edelman, who is a paid consultant for Microsoft, said the terms "help Google expand into areas where competition could otherwise occur."
…
Google has successfully promoted its own apps on Android. Four of the top 10 most-used apps on Android smartphones in the U.S. during December were Google's, according to comScore. On Apple's iPhone, only one Google app—YouTube—was among the top 10.

Calling Edelman a Microsoft consultant seems like a red herring. More relevant is that he embarrassed Google by noting that it tracked user browsing even when users disabled it. Edelman seems an equal opportunity Internet activist, having spent his entire adult life at Harvard (earning an AB, AM, JD, and PhD in econ before becoming an assistant and associate professor at Harvard Business School).

In his own analysis, Edelman shows how Google’s activities constitute tying:

If a phone manufacturer wants to offer desired Google functions without close substitutes, the MADA provides that the manufacturer must install all other Google apps that Google specifies, including the defaults and placements that Google specifies. These requirements are properly understood as a tie: A manufacturer may want YouTube only, but Google makes the manufacturer accept Google Search, Google Maps, Google Network Location Provider, and more. Then a vendor with offerings only in some sectors—perhaps only a maps tool, but no video service—cannot replace Google's full suite of services.

I have repeatedly flagged Google using its various popular and dominant services to compel use of other services. For example, in 2009-2010, to obtain image advertisements in AdWords campaigns, an advertiser had to join Google Affiliate Network. Since the rollout of Google+, a publisher seeking top algorithmic search traffic de facto must participate in Google's social network. In this light, numerous Google practices entail important elements of tying:

If a wants	Then it must accept
If a consumer wants to use Google Search	Google Finance, Images, Maps, News, Products, Shopping, YouTube, and more
If a mobile carrier wants to preinstall YouTube for Android	Google Search, Google Maps (even if a competitor is willing to pay to be default)
If an advertiser wants to advertise on any AdWords Search Network Partner	All AdWords Search Network sites (in whatever proportion Google specifies)
If an advertiser wants to advertise on Google Search as viewed on computers	Tablet placements and, with limited restrictions, smartphone placements
If an advertiser wants image ads	Google Affiliate Network (historic)
If an advertiser wants a logo in search ads	Google Checkout (historic)
If a video producer wants preferred video indexing	YouTube hosting
If a web site publisher wants preferred search indexing	Google Plus participation

Not all tying is illegal. But tying by a dominant firm is legally suspect — even more so in Europe, where the competition policies are more aggressive (especially for US firms like Google).

Technically Open, Commercially Not

From a practical standpoint, phone makers have no choice but to comply with Google’s terms (with the exception of China’s domestic market, where Google’s services are blocked). As OSS IP maven Florian Mueller wrote:

Technically you can take the free and open parts of Android (in terms of the amount of code, that's probably the vast majority, though the share of closed, tightly-controlled components appears to be on the rise) and build a device without signing any individual license agreement with Google, and some have indeed done so. If that is so, why did Samsung and HTC sign those agreements that have now come to light? For commercial reasons.

If you want your Android device to sell, you normally want to be able to call it an Android device. To do that, you need a trademark license from Google. Open source licenses cover software copyright, they may come with patent provisions, but licenses like the GPL or ASL (Apache) don't involve trademarks.

The trademark -- the little green robot, for example -- is commercially key. In order to get it, you must meet the compatibility criteria Google defines and enforces, which are mostly about protecting Google's business interests: the apps linked to its services must be included. And those apps are subject to closed-source, commercial licensing terms. That's what the MADA, the document Samsung and HTC and many others signed, is about.

Even if you decided that the trademark isn't important to you, you would want at least some of the apps subject to the MADA. What's a mobile operating system nowadays without an app store? Or without a maps/navigation component? Google gives OEMs an all-or-nothing choice: you accept their terms all the way, or you don't get any of those commercially important components. And if you take them, then you must ensure that the users of your devices will find Google services as default choices for everything: search, mail, maps/navigation, etc.

This “free” software comes at a price. Even if Google doesn’t charge royalties to use its applications, the London Guardian estimated last month that it costs $40k-$75k to test a new handset for compliance with Google’s standards and thus be allowed to ship Google’s applications.

Google Isn't Open About Not Being Open

Most troubling for me has been — since the beginning of Android — the gap between Google’s rhetoric of openness and the reality; for example, see “Open source without open governance” (June 2008), “Perhaps someday Android will be open” (July 2008), “Sharing in faux openness” (October 2009), “Google’s half-full glass of openness (January 2010), “Andy wants you to buy his openness (June 2010) “Semi-open Android getting more closed” (October 2013).

While these agreements have been in place for at least three years, Edelman notes that Motorola redacted the most important provisions of the MADA when it disclosed excerpts in a 2011 SEC filing. Google’s lack of transparency about its non-openness helps it be more successfully non-open:

MADA secrecy advances Google's strategic objectives. By keeping MADA restrictions confidential and little-known, Google can suppress the competitive response. If users, app developers, and the concerned public knew about MADA restrictions, they would criticize the tension between the restrictions and Google's promise that Android is “open” and “open source.” Moreover, if MADA restrictions were widely known, regulators would be more likely to reject Google's arguments that Android's "openness" should reduce or eliminate regulatory scrutiny of Google's mobile practices. In contrast, by keeping the restrictions secret, Google avoids such scrutiny and is better able to continue to advance its strategic interests through tying, compulsory installation, and defaults.

Relatedly, MADA secrecy helps prevent standard market forces from disciplining Google's restriction. Suppose consumers understood that Google uses tying and full-line-forcing to prevent manufacturers from offering phones with alternative apps, which could drive down phone prices. Then consumers would be angry and would likely make their complaints known both to regulators and to phone manufacturers. Instead, Google makes the ubiquitous presence of Google apps and the virtual absence of competitors look like a market outcome, falsely suggesting that no one actually wants to have or distribute competing apps.

With some irony, the WSJ article quoted Google’s former CEO:

"One of the greatest benefits of Android is that it fosters competition at every level of the mobile market—including among application developers," Google Executive Chairman Eric Schmidt wrote to then-U.S. Senator Herb Kohl in 2011.

Peeling Back the Layers of Openwashing

While the most specific and conclusive, this latest revelation is not the only evidence that Android is more openwashing than open source.

For example, in October Ron Amadeo of Ars Technica listed all the cases where “open source” Android once came with a key application available in open source, but then Google orphaned the open source app when it brought out a fully-featured closed-source replacement. This includes the Search, Music, Calendar, Keyboard, Camera and Messaging apps.

At the same time, Google (with great success) sought to convince app developers to use the Google Play APIs rather than the official Android APIs — thus making these apps incompatible with devices that use only the open source part of Android (e.g. Amazon’s Kindle). If you want to use apps from the Google app store, you have to use the Google APIs.

Finally, there’s the matter of the Open Handset Alliance, the organization nominally leading Android development. Amadeo makes clear that OHA is more like the Microsoft Developer Network than the Eclipse Foundation (emphasis in original):

While it might not be an official requirement, being granted a Google apps license will go a whole lot easier if you join the Open Handset Alliance. The OHA is a group of companies committed to Android—Google's Android—and members are contractually prohibited from building non-Google approved devices. That's right, joining the OHA requires a company to sign its life away and promise to not build a device that runs a competing Android fork.

Google: Partly Open and Opening Parts

In the early 2000s, open source was a paradox. When I began researching my second open source article (which I used as a job talk in December 2001 and was published in 2003), it was not clear how firms could make money from something nominally open. Based on a study of Apple, IBM and Sun, I concluded that firms made money off of openness with strategies that were open in one of two ways: they opened parts (leaving other parts close) or they were partly open (granting some rights, but not enough to enable competitors).

Google is clearly doing both. Amadeo emphasizes that with Android, Google is only opening parts — leaving key components under tight control. Meanwhile, the latest news points to Google being only partly open: rights to use the “open source” (actually, a mixed-source) system depend on complying with a series of Google restrictions.

In 2011, mobile analyst Liz Laffan studied the openness of eight mobile-related open source communities. Building on a 2008 study I did with Siobhan O'Mahony, she developed a 13-factor openness score for firm controlled open source communities. In her report (summarized in a 2012 journal article) Laffan assigned scores from 0-100% open. Android was lowest at 23%, and in fact the only project less than 50%. At the other extreme, Linux was 71% and Eclipse (designed to be open from the start) was 84%.

Conclusion: Real World Android is a Proprietary Platform

In the 1980s and 1990s, Microsoft won commercial success by widely licensing its PC operating system to all comers. However, after the initial licenses (with its launch customer IBM), Microsoft largely dictated the terms of these licenses.

When people buy an Android phone, they are not buying the Android Open Source Project but (as Amadeo makes clear) the Google Play Platform. This platform — call it Real World Android — has the following characteristics

• Like Apple’s OS X (or IBM’s WebKit), it combines open source and proprietary elements.
• Like Windows, it is licensed to a wide range of hardware manufacturers.
• Like both OS X and Windows, much of the value comes from bundling a wide range of proprietary, closed-source applications

In short, Real World Android is a proprietary platform: proprietary in that it is a mixture of open source and proprietary elements, but the complete platform (including application functionality and access to the Android app ecosystem) requires licensing proprietary technologies under a restrictive proprietary contract. (For a true open source system, the open source license would be enough).

A few market experiments (notably Kindle and the Chinese market) have been made using the Android open source project (which Amadeo dubs AOSP). For the remainder, as Florian notes, commercial success requires agreeing to Google’s terms to use its proprietary platform. If it was ever accurate to refer to Android as an open source platform, it’s clearly no longer true today.

Yes, by using an ad-supported (two-sided market) approach Google doesn’t have to charge royalties, but that doesn’t make it free (as in speech or as in beer). With 42% of the US mobile ad market — and Android accounting for the majority of US smartphones — Google makes billions off of Android users. Google’s preloaded apps command choice real estate, and if Google didn’t control this real estate, handset makers could sell this real estate to the highest bidder.

So despite all the rhetoric, Google is just another tech company that wants to rule the world and make zillions for its founders and executives. It controls its technology to gain maximum advantage, and (like many firms nowadays) uses openwashing to render spotless its proprietary motivations. This shouldn’t be surprising. It won’t be a surprise for anyone who reviews the how Android evolved (and the strategy emerged) over the first five years.

Semi-open Android getting more closed by the minute

From day one, I’ve remarked that Android is not really an open open source project. It promised openness but didn’t deliver, instead pursuing a strategy of semi-openness to gain market share against its proprietary rival. That Google tightly controlled the Android community shouldn’t be surprising since — for any firm — the point of funding (and controlling) a sponsored community is to gain benefits not available to other firms.

This wasn’t just my opinion, but was supported by a detailed study by Liz Laffan of Vision Mobile, a European consulting firm. (I thought the study was a clever idea — not just because it leveraged my typology of firm-controlled open source communities — and the press did as well). In comparing the governance of mobile open source communities, Laffan found Android was by far the least open of eight mobile-related communities. She concluded:

Android’s success has little to do with the open source licensing of the public codebase. Android would not have risen to its current ubiquity were it not for Google’s financial muscle and famed engineering team. Development of the Android platform has occurred without the need for external developers or the involvement of a commercial community.

Google has provided Android at “less than zero” cost, since its core business is not software or search, but driving ads to eyeballs. As is now well understood, Google’s strategy has been to subsidize Android such that it can deliver cheap handsets and low-cost wireless Internet access in order to drive more eyeballs to Google’s ad inventory.

More importantly, Android would not have risen were it not for the billions of dollars that OEMs and network operators poured into Android in order to compete with Apple’s iconic devices. As Stephen Elop, CEO of Nokia, said at the Open Mobile Summit in June, 2011, “Apple created the conditions necessary for Android”.

As Laffan notes, the one way that Android was open was the provision of source code. But that's changed too, as Ron Amadeo documented Sunday on the Ars Technica website:

Google has always given itself some protection against alternative versions of Android. What many people think of as "Android" actually falls into two categories: the open parts from the Android Open Source Project (AOSP), which are the foundation of Android, and the closed source parts, which are all the Google-branded apps. While Google will never go the entire way and completely close Android, the company seems to be doing everything it can to give itself leverage over the existing open source project. And the company's main method here is to bring more and more apps under the closed source "Google" umbrella.

There have always been closed source Google apps. Originally, the group consisted mostly of clients for Google's online services, like Gmail, Maps, Talk, and YouTube. When Android had no market share, Google was comfortable keeping just these apps and building the rest of Android as an open source project. Since Android has become a mobile powerhouse though, Google has decided it needs more control over the public source code.

For some of these apps, there might still be an AOSP equivalent, but as soon as the proprietary version was launched, all work on the AOSP version was stopped. Less open source code means more work for Google's competitors. While you can't kill an open source app, you can turn it into abandon ware by moving all continuing development to a closed source model. Just about any time Google rebrands an app or releases a new piece of Android onto the Play Store, it's a sign that the source has been closed and the AOSP version is dead.

In some ways, this is looking like IBM’s WebSphere. IBM has a proprietary software package layered on top of an open source Apache HTML server engine: yes, the engine is useful, but it’s not complete for the commercially important applications. (BEA’s — now Oracle’s — WebLogic plays a somewhat similar role). However, IBM was open about what it wanted: in our 2006 paper, Scott Gallagher and I noted how IBM was quite open about its partly-open strategy.

What’s different here is the suggestion by Amadeo (this week) and others (previously) of an intentional bait and switch strategy:

Vic Gundotra, recalling Andy Rubin's initial pitch for Android, stated:

He argued that if Google did not act, we faced a Draconian future, a future where one man, one company, one device, one carrier would be our only choice.

Google was terrified that Apple would end up ruling the mobile space. So, to help in the fight against the iPhone at a time when Google had no mobile foothold whatsoever, Android was launched as an open source project.

In that era, Google had nothing, so any adoption—any shred of market share—was welcome. Google decided to give Android away for free and use it as a trojan horse for Google services.
…
Today, things are a little different. Android went from zero percent of the smartphone market to owning nearly 80 percent of it. Android has arguably won the smartphone wars, but "Android winning" and "Google winning" are not necessarily the same thing. Since Android is open source, it doesn't really "belong" to Google. Anyone is free to take it, clone the source, and create their own fork or alternate version.

The article documents how Google uses its APIs and app store to punish any attempt to fork the code. (Yes, the Kindle is a successful fork, but without the Google APIs it will only have a fraction of the 850,000+ Android apps.)

Amadeo concludes:

While Android is open, it's more of a "look but don't touch" kind of open. You're allowed to contribute to Android and allowed to use it for little hobbies, but in nearly every area, the deck is stacked against anyone trying to use Android without Google's blessing. The second you try to take Android and do something that Google doesn't approve of, it will bring the world crashing down upon you.

Google gets the competition it deserves

At this week’s Mobile World Congress, the conference is focused on what happens next, now after Android has captured the majority of the world’s smartphone sales — and continues to gain share. Some distant clouds are on the horizon.

The WSJ this week asked whether the leading Android vendor, Samsung, is going to assert its buyer power against Google.

Google executives worry that Samsung has become so big—the South Korean company sells about 40% of the gadgets that use Google's Android software—that it could flex its muscle to renegotiate their arrangement and eat into Google's lucrative mobile-ad business, people familiar with the matter said.

The story said “Android head Andy Rubin … said Samsung could become a threat if it gains more ground among mobile-device makers that use Android.” The WSJ followed up with a blog posting asking “Can Samsung’s competitors catch up?” while Fierce Wireless reported a Samsung VP’s denial that Samsung’s success threatens Android.

The original WSJ story speculated that Samsung might ask for better terms, e.g. preferential access to technology.

In some ways, we’ve seen this story before. Symbian was supposed to be an open multi-vendor platform, but when Nokia accounted for 80%+ market share, it transformed both the Nokia-Symbian relationship and the level of interest and commitment by other vendors to Symbian. Yes, Google’s much richer and more independent than Symbian ever was, but it faces some of the same pressures that Symbian did. As it is, Samsung is making more profit from Android phones than Google is (an interesting reversal of the Microsoft-Dell exemplar).

(Google’s downstream vertical integration into Motorola is offered as an insurance policy, but since Motorola has been slowly dying for a decade, it’s not clear how credible a bargaining chip that is.)

Similarly, Samsung continues to support Tizen (the embedded Linux successor to LiMo, Moblin and Maemo), and plans on offering a new phone based on Tizen this summer. Samsung is using Tizen as an upward compatible replacement for its homegrown Bada, but it’s unclear how credible a bargaining chip Tizen will be — since it hasn’t offered a new Bada phone in two years.

The other challenge to Android comes with the introduction of the Firefox OS. Since handset OS makers — Google, Apple, Microsoft — are promulgating their own browsers, apparently the Mozilla Foundation figures they need an OS to put their browser into people’s hands.

The Firefox OS won support from LG, ZTE, Huawei and Alcatel, as well as serious interest from Sony (née Sony Ericsson née Ericsson) — but not from Samsung. It’s expected to ship from 18 carriers in nine countries, but not the US until at least next year.

There’s of course the question whether the world needs another smartphone OS, let alone another open source OS (remember webOS). After Android (69%) and iPhone (22%) together have 81% of the market, no other platform has more than 5% — with Tizen and Firefox starting behind Blackberry, WinMo and Symbian. But there’s no guarantee that the most popular OS in the US or Europe will be the most popular OS in China, particularly when China’s two largest handset vendors are supporting both Android and Firefox OS.

So based on recent history, Google’s concern in developed markets should be Samsung throwing its market power around (either within Android or to a rival platform), rather than having Firefox (or BlackBerry or WinMo) catch it any time this decade. It needs monitor Tizen or Firefox in the BRIC countries, but that could just be a matter of providing extra tech support engineers for Huawei and ZTE.

MetroPCS demonstrates the risks of leapfrog strategies

I was briefly an Android (and MetroPCS) user during the past week, but found the reality of the MetroPCS LTE service (and the Samsung phone) didn’t match the promise.

I got my first digital phone in the late 1990s when I switched from AirTouch to Sprint. I was with Sprint for about 14 years until I quit Sprint in May over high prices and a lousy phone replacement policy. Since late last year I’ve been assuming that I’d switch to MetroPCS (if I were working in San Jose or LA) or Cricket (if I were in San Diego).

I’ve been a particular admirer of MetroPCS, which combined the Cricket (Leap) business model with aggressive price cutting and clever branding to become the 5th largest network owner in the US. (Most importantly, they’ve also pressured the Big Two to be less outrageous in their pricing.) My biggest gripe was their misleading “$40/month” advertising — which (ala Sprint and the other Big Four) is not available to smartphone owners.

When I got the job in LA County I considered the various Android phones on MetroPCS and quickly settled on the Samsung Galaxy Indulge: it was one of their few Android LTE phones, and the only one with a keyboard.

As a result, after settling into my new job and living quarters I decided to give MetroPCS a try. For the past week I was a MetroPCS customer with the Galaxy — until I took it back Tuesday afternoon.

There were several reasons why the reality was worse than the promise.

First, the battery life on the Indulge was truly terrible. The store manager tried to warn me that his friend had problems with the Indulge, but it was even worse than he said. On Monday, I had the phone on in the morning for an hour (with WiFi on), checked email twice and lost half my battery life. Even without making phone calls, there’s no way I’d make it through a whole day. And when I had it plugged into the car adaptor, the phone got very hot — suggesting (as with 2G and 3G) that first generation 4G phones have serious power consumption problems.

The battery life was exacerbated by the need to turn down the screen saver. My most common search experience was the screen went blank (on a 30 second timeout) before I could get the answer to a simple Google search.

But the last straw was the poor LTE coverage. When the phone was in 4G range, it seemed to have good performance. (Other users reported 2.4 mbps, but I never formally measured it). However, it was not in range at my East LA County residence, and at various places on SoCal freeways. It was also (as expected) not in range when roaming to Cricket territory in San Diego. In those cases, it fell back to 1x (which users estimate is under 0.1 mbps).

For me, Metro’s gamble to leapfrog 3G for 4G was a failure, because the price was to fall back to completely useless 2.5G data service. All the other carriers have some sort of 3G coverage which would have been fine for my use case.

In fact, the most useful thing about the exercise was to crystalize my use case for my first post-Treo, post-Symbian smartphone:

• Email — both gmail and Exchange
• Traffic maps
• Web browsing, especially news
• Google searches

That’s about it. Yes, I installed Urban Spoon and Shazam — and my daughter would want to play Angry Birds — but the phone would be perfectly fine without those.

The one frill I tried was the wonderful new music streaming app — Yahoo! Music Radio — which is a partnership with Clear Channel and its Radio.com. I would eagerly install and use the player just for one station — LA’s K-Earth Classics (KRTH HD2) — which plays the 60s oldies that the iconic 101.1 used to play until it switched from boomers to Generation Jones and 70s music.

However, using a phone for music streaming requires good battery life (or a handy power adaptor) and an unlimited data plan. A 56K MP3 stream two hours a day on every weekday would use up 800mb/month of a limited download budget. (MetroPCS only allowed 1 gb/month for its $50 plan).

I considered swapping the Indulge for another phone, but it’s their only Android phone that does LTE. The other Android phones also didn’t have physical keyboards, and my one week MetroPCS trial confirmed my suspicion that a physical keyboard is an absolute must for typing without looking at the screen. The company’s weakness in Android phones is (IMHO) the main problem of their recent financial difficulties.

The story had a happy ending, at least for me. The company’s MetroPromise means you can take the phone back for a full refund if you follow their conditions. I did follow the conditions, and got my money back with just a long wait due to an understaffed local dealer.

Nook needs that long overdue app store

Brett Arends wrote a glowing review Wednesday in the WSJ of his nookColor and why it’s a better bargain than the iPad 1 or iPad 2. The main difference between his experience and mine is that he hacked his to be a fully functioning Android tablet:

I downloaded a very simple, perfectly legal software fix from the Internet that turned it into a fully functioning tablet running on Google's Android platform. The fix, known as a "rooting," unlocks Barnes & Noble's proprietary overlay. The instructions came via Ars Technica, a reputable site devoted to technology, and were pretty easy to follow.

I wasn't really expecting it to work. I tried it as an experiment. But the results were remarkable.

The Nook Color, which was designed mainly for reading books and magazines, is about half the size of an iPad or a Xoom. It weighs about 30% less. It runs on WiFi, but not 3G. It has an absolutely superb screen. And, once you've unlocked the software, it runs many Android applications, from email to news readers TweetDeck to, yes, Angry Birds.

He argues that it should stop stalling on its plans to make available its own app store:

A company spokeswoman would only say yesterday that it is still "in the works."

Huh? Time is not this company's friend. It should be seizing the moment while it can. Barnes & Noble stock, which was north of $40 five years ago, closed Tuesday at $11.67, a 14-year low. Not even the travails of arch-rival Borders Group, which has filed for Chapter 11 bankruptcy protection and is closing many of its stores, is helping.

I also have long thought B&N could grab the low-end tablet market if it wanted to. In particular, the Kindle is a locked platform while (in principle) the Android-based nook and nookColor are an open one, available for third party development.

The problem is that B&N, like Amazon, wants to make its money from content. Having people pay $250 or $200 for the tablet and never buying a book or magazine is exactly like hackers buying an Xbox or Xbox 360 and converting it to a Linux box without ever buying a game.

But B&N has a pretty clear choice: either get people to carry around its tablet, or proliferate its reader app and forget about selling tablets. I am much less enthusiastic about the nookColor than when I bought it, because without the basic apps that you would find in a 1995 Palm Pilot — like a synchronized address book, a calendar and a simple note-taking app — I still have to carry a laptop or smartphone to every place that I take my nook. (Or I can just carry the laptop and leave the nook at home).

My guess is that by 2015 both B&N and Amazon will be out of the tablet business, or at best will be private labeling someone else’s high volume tablet (like HTC or Samsung) the way Sears does for washers or refrigerators. So the next 2-3 years could be used to build loyalty to BN.com e-downloads (assuming it fixes its store) and perhaps further leverage the brick & mortar stores for supporting electronic content platforms.

Update Thursday 8:30am:
Arends was interviewed on the WSJ “Digits” video blog, reiterating the points of his column. Two points I’d argue with.

First, while he praised the screen as being better than other low-end tablets, he (or his host) concluded it wasn’t suitable for watching “Digits” on. In fact, that’s how I watched the interview: the nookColor does a great job of showing the video, even without Flash. However, the nookColor (or the WSJ web page) take over the screen and there’s no way to navigate back to the original page or to the next video. (I’m surprised he would say anything about this without trying it first.)

Second, while I long agreed with his general point about commodity tablets, he clearly underestimated the B&N achievement: 

Barnes and Noble is hardly a cutting edge technology firm. They have managed to come out with a pretty good Android tablet — from a standing start, I think within a year they set up the whole nook thing. If they can do it, anybody can.

This is like saying that because Google has created a mobile phone OS that competes with Apple, anyone can. That’s certainly not true: so far Nokia, RIM and the Koreans have failed, and it remains to be seen whether Microsoft will either.

B&N put together a crack team of Silicon Valley veterans in Palo Alto to make an easy-to-use mobile device. I don’t see the Asian commodity producers doing this, which means that (as with many other products over the last 40 years) most will have solid inexpensive hardware and incomprehensibly bad software. I think people will be much more tolerant of incoherent software in their TV or DVD player than in a handheld computer.

Delusional tablet proliferation

As part of the Year of the Tablet at the Tablet Electronics Show (TES) in Las Vegas this week, the chairman of AsusTek has unveiled a family of Eee Pad tablets (based on Android), hoping to leverage the brand recognition from its Eee PC family of netbooks.

According to the AP, the products were introduced by AsusTek chairmain Jonney Shih. The two main models are tablets that run Android 3.0 (aka Honeycomb):

• Transformer, 10.1" screen for $500-700
• Slider: 7" screen for $400-700.

In other words, they take a netbook, delete the keyboard and OS royalty, and double the price. I don't get it. Do they now see themselves as a technology or marketing powerhouse (apparently a common delusion among Taiwanese commodity producers.)

Suppose I wanted a 10" tablet. What other options might I consider? How about one with the most apps, the best PC integration, best browser, best dealer network and the best brand? So what kind of premium would I pay for an iPad? Perhaps none, since the iPad start at $500 — same as the Asus Transformer.

Perhaps I find that too expensive, and instead choose the 7" Asus Slider at only $400. Of course, there’s a NookColor (Android tablet) at $250 with a vertically integrated nationwide dealer network and a dedicated content store.

If this is the pricing of the promised wave of Android tablets, no wonder analysts predict Apple will retain 2/3 of the market.

Flash! Android is bringing commoditization!

the major goal of Android was and has always been commoditization: before Android smartphones were hard and now they’re easy. This is a point I’ve been making for a while, including August 2009, January 2010, March and earlier this month.

Now Forbes, its CIO network and the NPD consultants at PRTM have figured this out. To quote their article:

In 2007, Android looked like an experiment as well as a great and cheap way to challenge the extraordinary success of Apple and its iOS-iPhone-iTunes combination. But the success of the venture has unleashed a tiger, and now the handset companies are starting to look like its lunch.

More importantly, the PRTM consultants have put numbers to the trend:

• From Android 1.6 to 2.1, cycle time for new handsets dropped from 8 months to 4.5 months
• Most vendors bring new handsets to market within 16-20 weeks of a new Android release, eliminating any temporary OS exclusive.

To quote the report by David van Oss and Huw Andrews of PRTM, gross handset margins will shrink to the 8-10% common for commodity PC makers.

They encourage handset makers to find other sources of differentiation or perhaps look for a second handset OS. Perhaps they can use their custom Android UIs to create brand loyalty — I find this highly doubtful, but they may create gratuitous switching costs.

Van Oss and Andrews predict Google will charge a royalty for Android. Yes, the company’s got conflicting goals — promoting its mobile platform vs. promoting mobile search use. But I don’t see a scenario in the next 3 years that has Google trying to extract royalties from the Android platform. (Fine print: I won’t rule out it offering new “must have” royalty-bearing technology like voice recognition).

A lot could happen in three years. By then, Nokia could be making Android handsets, or the Chinese could be shipping the majority of the world’s smartphones. Or smartphones could be on their way out, replaced by tablets. So anything beyond then is pure speculation.

Android leads inevitable march towards commoditization

Had meant to write Tuesday about the latest quarterly market share data for Android, but it got buried in between grading, meetings and of course watching the election.

Perhaps more significantly, what can you say? Android market share is monotonically non-decreasing, so every quarter the Google-controlled alliance gets more good news.

Still, the Canalys Q3 estimates were impressive:

Platform	US	World
Symbian	n.r.	33%†
Android	43.6%	25%
iPhone	26.2%	17%
BlackBerry	24.2%	15%
Windows	3.0%	3.0%
Other	3.0%
Total		80.9m

† “Nokia”, not “Symbian”
Apple’s smartphone share has clearly peaked. The iPhone is losing to Android despite its obvious advantage on two key metrics — ease of use and variety of applications. Instead, all that matters are product proliferation and distribution — there are dozens of Android phones at various price points from all the major carriers. You want a keyboard? Or no keyboard? Big screen or small screen? Android has offers these choices and iPhone doesn’t.

Adding Verizon someday isn’t going to change this. And as the dumbphone dies and every phone becomes a smartphone, Android will gain share in the segments Apple is ignoring. Android has made the smartphone a commodity — an adequate OS is no longer an entry barrier — consigning the iPhone to the top 10% niche of buyers willing to pay a premium for better quality.

Meanwhile, Nokia has knifed the Symbian baby by sacking most of the engineers it hired after losing the allies that once vowed to support it (before Android caught on.) Its current path seems to be using its proprietary QT APIs to migrate developers off Symbian to Meego, its proprietary Linux that competes with Google’s slightly less proprietary Linux.

In the near term, the story for Apple on tablets is much more promising, as latest estimates show it with a 95% worldwide market share. (The figures are misleading since it excludes e-book readers, and the Nook Color shows there is no clear boundary between the two categories.)

In Apple’s favor is that unlike cellphones, there is no need for the needless variants and pseudo-differentiation that we see because network operators control nearly all the cellphone distribution. As with the iPod, Apple could conceivably keep a 50+% market share in tablets, assuming it overcomes its irrational (and Newton-like) aversion to smaller tablets and aggressively engages in product proliferation as it does with the iPod.

Google joins the world of patents

Since Oracle sued Google over Android’s alleged infringements of Java IP, there’s been a lot of speculation about what Oracle really wants. Perhaps it’s just that under new management, Sun is no longer interested in open source (as in the death of OpenSolaris) or any other form of openness.

But no matter what the motivations or how the case turns out, Google will be changed forever.

Google is being dragged kicking and screaming into the world of patents. Welcome, Larry and Sergei, to the mess that is our 21st century intellectual property system.

Google's founders had a vision of a world where superior efficiency and scale provided unchallenged market position and competitive advantage.CEO Eric Schmidt joined after being at two companies that lost such a game: Sun and Novell. (Am I the only one who sees an irony in Schmidt being beaten over the head with a club he helped make?)

Unfortunately, the world is not so simple as to say that the company with the largest market share gets to keep all the spoils. Just ask Bill Gates — or perhaps Lou Gerstner of IBM or Steve Jobs or the folks who sued Rambus.

For this technology-trumps-all, rude shock #1 was its disputes with content owners: not just Viacom vs. YouTube — but also Google books and Google news. As Randy Stross noted in his 2008 book, Google had a painful adjustment when it could't understand why it couldn't go and do whatever it wanted to do. (Again much like Microsoft in the 1990s or Apple today)

In reaction, Google had to hire a lot of copyright lawyers to represent its interests in disputes over fair use, compulsory licensing and incentives for creativity. Within the next 3-12 months, I suspect Google will similarly bring a world-class patent counsel in house.

As it so happened, the Oracle/Google lawsuit came up Friday in a previously-scheduled meeting with an industry insider. Without any direct personal knowledge, he attributed it to Google’s naïveté:

As far as I can tell, I don’t think Google cared [about the risk of patent litigation].

1. They assumed we’re a big company and nobody’s going to sue us.

2. They assumed “nobody is going to sue a GPL distributor, because the FSF and free software advocates are going to be behind us.”

Can you get out of paying patent royalties just because you distribute GPL code?

He then drew an analogy to a mythical “Free Car Company.” Can the car company get out of royalties on engines or wiper blades just because it gives away cars?

He also noted that the lawsuit may be about more than just Java middleware. A decade ago, there were four major patent holders for operating systems: IBM, Microsoft, HP (probably from its acquisitions of Tandem and DEC) and Sun. James Gosling (of Java fame) notes that Sun armed itself with patents to defend against IBM.

Now Google is shipping one of the most popular operating systems ever invented, and being challenged by the firm that holds one of those four major patent portfolios.

In the world of high stakes cross-licensing, Google needs a friend among those Big Four. A year ago, it looked to be HP, but since they bought Palm they’ve turned a cold shoulder to Android.

Once upon a time, list price for a mobile phone OS royalty was $5/unit (for something like Symbian or Windows.) If Google shipped 10 million units in Q2, then (even with the Christmas rush) a whole year’s royalties would be less than $500m, perhaps (depending on the per unit price) under $100m.

Still, if Oracle can extract a billion or two from Sun’s patent portfolio — without having to reinvest in actually inventing anything — the $7b purchase price is going to look cheap.

When closed is better than open

The iPhone and Android are fighting for smartphone leadership with many similar strategies: touch screens, a good browser, an app store with thousands of apps.

Overall, however, Android is seen as more open. This is normally assumed to be a good thing, but two recent incidents suggest such openness has some disadvantages.

One of the long-remarked differences is that that Apple is selective (some say arbitrary) about which apps it allows in the Apps Store, whereas Google is pretty laissez-faire about what it allows in Android Market. But — as in many things involved complex technical or business systems — it’s not that simple.

Finally Google realized that some people were abusing its app store and decided to throw some out. AppBrain reported Monday that one app developer alone had 4,000 apps deleted from Android Market. On Wednesday, AndroidGuys reported that one of impacted developers vowed to be back, using multiple fake logon accounts. (H/T: Phandroid).

Why would one firm publish 4,000 apps? Reportedly the developer said:

We didn't want to have to do that. But the Android Market doesn't have many people who like to pay for apps. So how is a developer to live? Just off of ad revenue?

This is interesting on so many levels. Ad-supported free software works great for Google and is the norm on the Internet, but (if this claim can be believed) isn’t working so well for app developers.

As in desktop and server Linux, apparently Android users expect free beer. Excessive openness by Android — like free access to open SMTP relays — makes it possible for “spammers” to both gain access and work around limitations in a way that a physical market would not allow.

In telling the smartphone app story, we think about positive externalities: more apps brings more users brings more apps. We don’t think about negative externalities (like traffic jams or overcrowding): more users brings more abusive app vendors brings lower average app quality.

Finally, this problem raises the question of what the count of Google apps means if so many of them are bogus. If a real live human being is screening each app, then both the count and the quality are meaningful.

I figure Google will solve this eventually, probably with an algorithm. The algorithm will count the number of apps, the rate of app submission, the similarity of apps, perhaps their complexity. Just like the credit card companies, this will trigger an exception report that has to be monitored by a real live human being.

The one that seems more troubling — and harder to fix — is the openness to customization by manufacturers that preload craplets on the phone. Wired lists examples of Samsung (with a T-Mobile phone) and HTC (with the Sprint Evo). The HTC rep was blunt:

“It’s different from phone to phone and operator to operator,” says Keith Nowak, spokesman for HTC. “But in general, the apps are put there to meet the operator’s business and revenue needs.”

What’s particularly annoying to users is that this bloatware cannot be removed by users. To me, this is inconceivable: I can delete apps from my Mac and every Palm OS phone I’ve ever owned.

Alas, this is inherent in the Android business model. The iPhone put Apple in the driver’s seat with carriers, but it was a temporary aberration. The whole point of Android was to commoditize smartphone software, and with it reduce barriers to entry (and thus prices) for smartphones. Commodity phones are the dream of Vodafone and the rest of the world’s carriers, restoring (in their minds) them back to their rightful dominance in dictating to vendors and users alike.

Big bad Apple controls what apps are allowed in its app store. Big bad Apple tells operators what apps it will provide pre-installed. So the iPhone is less open, but (at least as long as Steve Jobs is there) that proprietary control is used to provide a better user experience.

Andy wants you to buy his openness

On Tuesday, the Merc had a (very brief) Q&A with Android founder, now Google Mobile executive Andy Rubin.

I recommend the entire interview, but let me quote the most relevant passage to this blog:

Q: Since you started this effort, industry and government regulators have moved toward making the market much more open. Given that, is Google's Android effort still necessary?

A: I think so. It's a progression. We're at a moment in time right now, but the definition of openness is going to change over time.

What does openness mean? Is a platform that is open to outside programmers open? Is a platform that has an open content store open? Is a platform that's open source open? All those definitions are still in flux, I think.

So I don't think it's time to give up. I think it's time to double down.

I certainly agree with most of this — openness is ambiguous, with lots of definitions. However — like others — I reject the idea that “open” is a bright line, black or white — rather than shades of gray.

One of the shades of gray, of course, is whether openness in (say) hardware is more important than openness in (say) search engine choice.

Still, Rubin seems to have an element of realism (and perhaps self-awareness) absent from other Google exec pronouncements. I’m not quite as skeptical as Steve Jobs is about “do no evil” — but clearly Google (like other companies) is spending most of its time doing what’s good for Google.

Thus far in mobile, Google has used openness in its mobile platform as a club to gain influence or advantage over the various industry incumbents. To the degree to which the openness is genuine and accurately portrayed, Google certainly deserves credit both for giving people what they want and pressuring the rest of the industry to be more open.

What good is an iPad?

Friday marked the international debut of the iPad. The Apple tablet went on sale in Canada, Japan, Australia and six major European countries.

Apple drew lines in Japan, UK and France, although it was not clear whether this was due to pent-up product demand or a carefully orchestrated launch event. Still, many expect 2010 iPad sales to exceed 10 million, and one analyst claims that iPad sales will pass the Mac in Q3 of this year.

Coincidentally, during the hours leading up to the launch, two of my friends who are iPad owners reported their contrasting views of the iPad value proposition: one who increasingly can’t do without it, and one who’s dumping it.

As best I can tell, their differing reactions relate to their differing use cases, and thus illustrate both the challenge and opportunity of the iPad and tablets more broadly. They also confirm my own ambivalence about the product category.

One friend — who I’ll call “the Beav” — sent me an email asking if I had a Skype account so he could test out how Skype works with the iPad. The last time I saw him, he showed up with his new iPad, talking about how he bought an iPad only to support a client but found it to be a handy, fun device.

Another friend — who I’ll call “Anthony” — posted to his Facebook page that his nearly-new iPad is for sale because he isn’t using it. One of his friends would have done the same thing but one of his kids has claimed it as an oversized iPad Touch toy.

Although I haven’t seen him in several years, it sounds like Anthony’s use case is a lot like mine. On weekdays, he spends most of his day in one of two places — work or home — and he already has a solution for both places (a laptop at home, a desktop at work). When he’s out and about, he either doesn’t want to reach the Internet or uses his iPhone.

On the other hand, the Beav spends much of his day traveling around between client sites, and (I imagine) has a lot of brief opportunities — 2 minutes here, 10 minutes there — to check email, look something up on the Internet, read news, watch a video etc. etc.

My own story is that I have one computer that I take everywhere for everything, as I have for the past decade. Right now it’s a two year old, slow, increasingly fragile MacBook Air. It’s a nice form factor, but otherwise a mediocre computer, but due to my employer’s budget problems I am not allowed a replacement for another two years — and so have to buy my own replacement (since no lightweight laptop can survive daily use for four years).

Even with the Air, I must say I am envious of Kindle and iPad owners who can flip out their devices at the drop of a hat — as with the guy next too me in steerage on my quick trip to Europe earlier this month. When that airline seat reclines in front of you, even the smallest laptop (and probably most netbooks) aren’t going to work unless your employer paid for those cushy business class seats.

However, I’m not going to type an email of more than two paragraphs on the iPad/iPhone virtual keyboard, nor am I going to use it to edit a memo, let alone a 10,000 research paper. The iPad has a wired keyboard dock option, presumably for a desk at home or work. You can also get it to work with a Bluetooth keyboard and even (unofficially) a mouse, but carrying those around eliminates most of its size advantages.

More seriously, is the world waiting for a 3rd screen to carry around — beyond the 13-15" laptop (or 10" netbook) and the 2-3" smartphone? That was Anthony’s problem, and would also be my problem unless I spend as much time on the road as The Beav does — or have a lot of electronic reading time standing on a train, sitting in an airplane seat or by the pool.

For some, the lack of Flash (or TV video) on the iPad is a deal breaker, particularly if Time Warner and NBC (Universal) continue to hold out on doing a conversion (unlike frenemy Google). For me, it’s having a big enough screen to write something but not the keyboard or application software. (I could see using Keynote on the iPad but not Apple’s defeatured word process or spreadsheet.)

Which means I end up on the iPad — and tablets more generally — where I started. Tablets will not create a new category, but will supplant (or merge with) one or more of the current substitutes: smartphones or netbooks.

Apple and Google and now HP are betting on the smartphone platforms taking over tablets. Since Microsoft has the 5th most popular smartphone platform, it presumably hopes that Windows Vista can be successfully ported to tablets.

Here I am less optimistic about the iPhone and webOS than I am about Android. (Full disclosure: I grossly underestimated how quickly the iPhone would gain market share and transform the market, missing out on a 150% stock three year price gain that spanned the most intense recession in 50 years.)

If tablets are going to catch on, it seems as though there is another shoe waiting to drop: the oft-requested OpenOffice on Android. (Yes, Androffice allows Google docs on Android, but rarely is my Internet connectivity fast enough to make the SAAS model even remotely satisfactory.)

On the one hand, OpenOffice (like Android) is the open source darling of its category. On the other hand, there is bad blood between Sun and Google after the latter bypassed Java (and Java licenses and royalties) to provide its own alternative Java VM.

Still, I don’t see tablets as a plausible mass market replacement for a netbook before there is a good office productivity suite to go with email, a web browser and various e-book readers. I’ll be curious to see whether Barnes & Noble extends its Nook into this segment, or leaves the category to Dell and other Adobe tablet licensees. Conversely, perhaps the best hope of tablets is to be über-ereaders, seeking to supplant dead tree media rather than computing or communication devices.

Update Saturday 11am: Yet another iPad-owning friend, Youngjin Yoo, has responded to this post with his own blog post, in which he endorses the book replacement niche for the iPad.

Microsoft hosts Android platform

Earlier this month, Microsoft Research in Silicon Valley hosted a seminar on Android. I tweeted live from the event:

Serious irony: here at Microsoft Research (Mountain View) waiting for talk on Android, using the Internet via GoogleWiFi (free in Mtn View).
6:53 PM Apr 13th via Tweetie

At Android event http://bit.ly/dym6ff local IEEE CompSoc vice chair installed Android on his AT&T Tilt phone (originally Windows Mobile).
6:58 PM Apr 13th via Tweetie

This is not to say that Microsoft and Google can’t find occasional common ground in their fight for Total World Domination. (For example, Microsoft said Wednesday it will license patents (under royalties) to its customer HTC to defend against allegations that HTC Android phones infringe iPhone patents.)

However, in this case the seminar — “Android: A 9,000 Overview” — was organized by the Santa Clara Valley chapter of the IEEE Computer Society. It had a unique two-part format: a business overview by Mike Demler and a technical tutorial by Marko Gargenta.

Android Platform: An Ecosystem View

Demler is a semiconductor engineer (with a MSEE from SMU) who I met when he was getting his MBA at San Jose State. He summarize his own talk on a blog post that includes his slides:

This presentation provides a quick overview of the participants in the rapidly expanding Android ecosystem; from software to semiconductor companies, wireless providers, handset manufacturers and app stores, to the numerous opportunities in consumer electronics beyond smartphones.

He was seriously limited for time, but Mike provided a very clear overview of the ecosystem, complete with information about recent trends (part of a his planned update to his $200 report on Android trends.)

To readers of this blog, some of his basic points were familiar: Android has won support by all four US carriers, the rate of new devices is increasing, and it’s going to have an impact beyond cellphones. Because (unlike the iPhone), all four carriers are carrying multiple Android devices, Mike is among those who are very optimistic about its future US/global market share.

Two tidbits were specifically interesting to me:

• Cellphone manufacturers and carriers are mobilizing their developer support organizations to back Android, through programs like MotoDev and third party tools like DeviceAnywhere.
• In products beyond mobile (to use Bill Weinberg’s phrase), Android licensees are pushing the platform in an area that’s not a priority for Google. Examples include not only the Nook (and an e-reader rival named Alex), and various notebook-type computers from HP and Acer, but also settop boxes on at least two continents.

Android Platform: Technical Overview

From both his talk and website, Marko Gargenta clearly spends a lot of his life helping programmers understand the Android platform. He posted his slides to his LinkedIn profile which points to SlideShare, but similar earlier talks (particularly “Android Internals”) can be found as PDFs via Google.

Marko’s tutorial looked fun to this former programmer, including the Eclipse tools that make it (relatively) easy to target multiple platforms: Android 1.1, 1.5, 1.6, 2.0, 2.1. It was also fun to see that Android adopt a 25+ year old Apple concept of resources, both to hold program data and also to support a non-procedural definition of user interfaces and other program structure.

Marko identified two aspects of the technical architecture that provided insight into Google’s business strategy.

First, Java fanatics were excited to hear that the programming APIs are in Java, but Sun was disappointed that Android doesn’t use its standard Swing or other J2ME (Java ME) libraries, but instead has its own unique user interface APIs. The equation Marko put on the board was:

Android Java = Java SE – AWT/Swing + Android API

and he got a few laughs for his Trumanesque newspaper headline.

On a related note, Google didn’t want to pay royalties (in its free OSS distribution) for Sun’s Java Virtual Machine, so Java code is translated from Java bytecode into .dex files to run on Google’s own Dalvik Virtual Machine.

Secondly, the message-based Android APIs allow a third-party application to handle any function that an Android-supplied one can: browser, email, calendar, mapping, etc. Like Windows (or the iPhone), the Google code cannot be deleted from an Android device, but unlike the iPhone (or other platforms) the third-party software can supplant the built-in application, fully integrated into the phone operations and the user experience.

Finally, from a technical standpoint, Google is allowing native development of C/C++ source code using its NDK. Unlike Java, this code is no longer processor independent (thus requiring bundling separate code for ARM-licensed and Intel processors), but it does allow high performance for things like image or audio processing algorithms.

The availability of such information — and the overflow crowd of programmers eagerly seeking it — shows one of the strengths of Silicon Valley. With nearly 40,000 Android apps available, we in the audience were not exactly the leading edge, but there is a huge pent-up interest in Android here that seems to be approaching that of the iPhone.

The interesting question is: how much longer can new entrants into either ecosystem make money? I think it will play out like the PC, Mac and other software platforms. In a year or two (if not today), the the only ISVs making money on either platform will be either the pioneers (who shipped one of the first 10,000 apps) or the big boys (EA, eBay, Amazon).

Slew of new Android phones

This week, LinuxDevices reported a flurry of new Android phones, including

• Motorola i1, the first Android phone for the Sprint Nextel (i.e. Nextel) iDEN network;
• Dell Aero, the AT&T variant of the Dell Mini 3i being offered in China;
• HTC Evo 4G, the first Android phone to support the Sprint/Clearwire WiMax network;
• Sprint announced it will offer the Nexus One, the first CDMA carrier to do so; and
• Kyocera Zio M6000, the first phone from Kyocera (which made the early 6035 Palm OS smartphone). The phone is rumored to be bound for the Cricket discount cellphone service.

The proliferation of Android phones is good for Google and good for carriers, but the fragmentation of the Android customer base will make it increasingly more difficult for handset makers to earn a return on their Android investments, unless (as HTC is doing) they engage in product proliferation.

Android forks: ho, hum

A friend sent me an article this week from InfoWorld entitled “Google Android's self-destruction derby begins.” The author seems to think it’s a big deal that the Android source code base is forking all over the place, although similar (and less apocalyptic) stories appeared last year in The Register and Business Week.

The reality is that forking is against the Free Software religion, and it’s also an inevitable outcome of any open source (or free software) license. People (or firms) make their own unique variants of the source code because they can: that was true 15 years ago with the BSD proliferation (BSDi, FreeBSD, NetBSD, OpenBSD), and it’s true with Linux today.

Forking is an organizational and economic issue, not a legal or technical one. The economic benefit of avoiding forks is to avoid re-inventing the wheel (on a daily basis for decades).

Forking long predates open source. In my first job out of college,I made it my mission to merge back all the source code forks in our proprietary code base (for our SIMSCRIPT II.5 compiler). The nominal goal was to facilitate maintenance and reduce incompatibilities, but the real reason was that merging changes across forks was tedious work, prone to errors,and that no one wanted to do.

However, the problem — then as now — is that maintaining a common code base requires surrendering control: if everyone is going to agree, then no one is going to get exactly what they want. Or — as in many open source projects — egalitarianism and meritocracy is ala Animal Farm: all contributors are created equal, but some are more equal than others. (What human endeavor is without politics? I can’t think of one.)

Android‘s cellphone licensees don’t want to surrender that control — and for that matter, neither does Google.

Thus (as InfoWorld notes) the Android handsets are shipping in a wide range of OS versions: 1.5, 1.6, 2.0 and 2.1. Part of this is that Android (like any new code base) is a rapidly moving target. The issue is compounded by the fact that Android handset makers all want to have their own custom user interfaces. (It seems as though Android is making the Symbian UI proliferation mistake all over again, which seems consistent with the high concentration of hubris in Mountain View).

In addition to the fragmentation of user experiences, the handset makers are having trouble updating their UIs to the latest Android OS — apparently due to (again not surprising) rapidly changing Android APIs. So in 2010 Sony Ericsson will be shipping an Xperia Mini based on Android 1.6, while the Nexus One (and its flashier half-sibling, the HTC Desire) will ship with Android 2.1

Of course, Google has also chosen to fork from the Linux kernel, because its own widespread code changes are both incompatible and (now) rejected by the Kernel team. If Google wanted to get along, it would have had to slowly and delicately negotiate with the Kernel honchos to come up with a consensus solution, but (not unrealistically) that it decide it would rather ship product in 2008 and 2009.

At some point, the Android APIs will stabilize (3.0? 4.0?) and the handset makers will be able to track the latest OS releases without major changes. They’ll still have their own GUIs — and for now Android will remain separate from the Linux code base — but things will be a little more efficient and a little less hectic.

When should I switch to Verizon?

For more than a year, I’ve been mulling over which mobile platform (and carrier) to choose, given that my original choice has reached the end of the line — and so I’m gonna have to pay switching costs anyway.

I’ve been with Sprint for more than a decade. Since 2001, I’ve had a series of Palm OS smartphones since buying a Kyocera QCP-6035. My next phone is not going to be a Palm, given that the company has doubled down on the Pre, which was too little and too late.

It’s also not likely to be Sprint. Sprint is like other carriers in requiring a monthly data plan subscription with smartphones; however, it’s unlike the others in requiring a data plan for all phones on the family plan, and only one person (me) in our household needs a data plan.

I’ve been tempted by the iPhone and in fact would have bought an iPod Touch last summer if they’d updated the product instead of peddling a warmed over 2008 model. My one problem with the iPhone has always been AT&T.

While contemplating this, I saw the recent issue of Consumer Reports which notes that AT&T has the worst service of the big four mobile operators, while Verizon Wireless has the best. This is particularly true in the three major California markets — San Francisco, LA and San Diego — where I make 99+% of my calls and probably 100% of my data usage. (Of course, this only reinforces the recent advertising war between the two carriers.)

Sprint is only slightly better than AT&T in nationwide satisfaction, but at least (as I’ve found) it roams to Verizon. T-Mobile is second only to Verizon, but roams to the problematic AT&T network; it also has a spotty 3G network and its devices are incompatible with AT&T’s 3G services in the 850 MHz band.

So barring a workaround to Sprint pricing, my next phone will be on the Verizon network. Of the major smartphones platforms, BlackBerry is too business oriented, Windows has no attraction whatsoever, and Symbian is absent from CDMA. Although BlackBerry is #1 in US market share, two other platforms have bigger app stores.

In other words, as for so many others, it’s down to iPhone vs. Android.

On Verizon, I could wait for the mythical Verizon iPhone (rumored for June), or the Nexus One (promised for “Spring”), or buy a Motorola Droid now.

This has me leaning towards Android. My former student Rahul points out that Android isn’t particularly good for Exchange or games, neither matter to me. (My daughter might disagree on one of these.) On the other hand, the fact that OS X 10.5 won’t sync with Google’s addressbook would be a problem — since I refuse to use 10.6 — but fortunately there’s an app (workaround) for that (which I’ve already tried out.)

With a dataplan, I want a real keyboard, so on paper the Droid looked interesting. Sunday I went to Costco to try the Droid again. However, as even Motorola‘s CEO admits, it has a terrible keyboard.

Also at Costco, the T-Mobile Motorola Cliq certainly has a better keyboard than the Droid. On Sprint, the Samsung Moment has the best keyboard of these three phones. Or I could wait for the promised Droid upgrade — at which point the CDMA iPhone may already be shipping.

So that’s my dilemma. I’d be curious to hear from owners of smartphones with a slide-out keyboard (except for those drinking Luke Wilson’s Kool-Aid.)

What’s really odd for me is that on Mac vs. Windows, I’ve been 110% Apple for 26 years, despite paying a premium price and having a limited selection of products. On iPhone vs. Android, the limited selection of Apple products is worse (effectively one model), and so it looks like I’ll choose the non-Apple solution, even though it’s clearly inferior on ease of use. Perhaps it‘s because a PC is a general-purpose device while a phone (for now) is just a phone (Sorry, David.)

On the other hand, it could go the other way. My MacBook Air is not going to make it to 4 years (our college-mandated replacement cycle.) When it it dies, if Apple continues to ignore the netbook, I may end up buying a Windoze machine that’s uglier, equally speedy but one-third the price. If nothing else, I could install Safari, Firefox, iTunes and (sigh) Eudora, and have all the same apps that I’m using today.

Google's half-full glass of openness

A number of experts have been remarking that the NexusOne brings Google into more direct competition with Apple and the iPhone, ending a once cozy and complementary relationship between the two firms.

Google’s mobile strategy continues to get closer to Apple’s. Both are peddling mobile platforms, seeking users, operators and third party software providers. While Google’s OS is open source — and available via multiple handset manufacturers — it still is a hybrid open/proprietary strategy that competes with Apple’s own hybrid strategy.

Some analysts understand this better than others. Dan Moren of Macworld portrayed it thusly:

By putting its name on the Nexus One, Google has given the Nexus One a sort of primacy on the Android front, unifying the disparate elements of the Android movement: now it’s Google going head to head with Apple, not a strange amalgam of Google, Motorola, and Verizon. It’s as if Google has promoted itself to head of the Rebel Alliance opposing Apple’s Galactic Empire.

Ooo, there's a value laden metaphor if there ever was one! (NB: In Star Wars III, Lucas is much more sympathetic to the Empire’s control problems than he was in 1977 with Star Wars IV.)

A much more accurate characterization came from John Gapper of the FT

Yet Apple is not as closed as Google portrays it, and nor is Google as open. Instead, like the proverbial half-empty glass, Google is best regarded as half-open and Apple as half-closed. That is significant because it shows how such companies need to compete in a networked industry.

Google is fighting for its own interests as hard as Apple does. That is, at one level, obvious since they are both public companies that try to maximise revenues. Yet its insistence on not doing “evil” and its dismissive view of Apple and Microsoft obscures this.

Gapper’s point is that even if Google’s OS is open, it plans to make money off these phones through its control of search. Gapper had earlier observed that mobile phone value capture had shifted from European telecom manufacturers towards US Internet companies (e.g. Google), as well as Apple.

I agree with Gapper’s overall point this week that mixed proprietary/open strategies are both normal and reasonable. I also share his aversion to exaggerated claims of openness.

However, in thinking about some of my earliest research on openness — ironically a 2003 paper about Apple’s early open source strategy — I think Gapper has only half the story.

Gapper focuses on how (to use my 2003 term) Google is “opening parts”. Its mobile phone OS is open source, but other parts of the value proposition (e.g. search, maps, mail, etc.) are proprietary. Google shares its code, but not is advertising revenues.

However, to use the 2003 terminology, I think it’s clear that Android is also “partly open.” Truly open sponsored open source communities do more than just provide source code, but also share in the governance and technical direction. Someday Android may be open, but it’s not there yet.

While Gapper talks about the openness glass being half full, I think an equally important point is that for many companies it changes over time, and differs between markets and products.

The two most proprietary companies in the PC industry, Apple and Microsoft, had various degrees of openness over time and across product lines. Among mainframe companies, IBM was once the captain of proprietary IT strategies, but in the past 20 years has moved to embrace open source and make lots of money off of services. Sun claimed to be open — and in relative terms it was — but still did everything it could to create switching costs and proprietary rents. (NB: Google CEO Eric Schmidt spent 14 years at Sun as a manager and eventually CTO.)

So I think that the only realistic way to view Google is as a self-interested, profit-maximizing, semi-proprietary company that embraces openness when it suits its purposes. Consumers should (and do) welcome that many of its ad-supported services are free, but continue to remember that Google wants to keep its repeat customers every bit as much as Apple, IBM and Microsoft do.