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Google, AT&T: You're Scaring Me

by Leo Zheng

Thoughts on recent news from Google and AT&T.

Published: August 17, 2011

The opinions expressed here are my own and not representative of Junction Networks as a whole. :)

It’s been quite a week. Two days ago, as I’m sure you’ve already heard, Google made the surprise announcement that it had entered into an agreement to purchase Motorola Mobility for 12.5 billion dollars in cash.

As part of the purchase, Google gets over 17,000 patents, ammunition which will no doubt come in handy against attacks from Apple and Microsoft. This move, however, puts the other Android OEMs into an awkward position, despite what their eerily similar official responses say. You know, that thing they all said about welcoming Google’s ‘commitment’ to ‘defending’ Android. That’s not exactly the sentiment I got from Samsung vice chairman Choi Gee-sung.

“We don’t believe Google’s takeover of Motorola will be such a big issue since it was an event that was already predicted. Samsung could also make use of our own proprietary platform and Microsoft Windows mobile operating system… the mobile business is not solely about the OS.” [src]

Already predicted? By whom? Everyone I know was caught off guard by the deal, but maybe it didn’t come as such a surprise to the players across the pond. “In the long term, handset manufacturers will be need to be equipped with their own proprietary platforms as Google might become the next Apple Inc.,” said Hana Daetoo Securities analyst Chun Sung-hoon. It’s an interesting idea that Google would consider this approach even if the company’s official statement promises that they will run Motorola as a separate entity and that for the most part, everything will be business as usual.

In many ways, it makes sense. I’m sure a lot of people are taking this acquisition as Google admitting that disconnecting software and hardware development isn’t the ideal setup. Things get complicated when you have end users with devices from different OEMs, all running different (and sometimes outdated) versions of your OS.

What you end up with is an Android experience that isn’t well defined. When you buy an iPhone, you know pretty much exactly what you’re going to get without having to do too much digging. When you buy an Android device, who knows? There’s high end, low end, and everything in between. It’s also so much easier to market your product when you don’t have multiple OEMs to confuse the heck out of your less tech-savvy consumers. If you’re an iPhone user, you know you want the iPhone 5. Heck, people (myself included) are scrambling for every piece of news about the iPhone 5 they can get their hands on. I also have a Nexus S. Am I supposed to get excited about new Android models that get released between now and the next Nexus phone? I don’t know. Heck, many people don’t even know that the Nexus phones are Android’s flagship devices.

These reasons might very well be part of the reason why, despite Android’s impressive increase in market share over the years, iPhones are still sexier to many people. With Motorola completely under their control, Google can at least provide a well-defined blueprint for other OEMs to follow. This is where I see an opportunity to really streamline their product lines. But this move is still weird. What’s scary is that it’s so… not Google. What happened to the collect-all-my-data-and-shove-ads-down-my-throat Google that I grew up with? What happened to being software and cloud focused? Sure you were frightening, but at least I knew what you were doing and why you were doing it. Now you’re unpredictable and dangerous and I’m not sure how to feel about it.

And now let’s move on to AT&T.

A document that was accidentally posted on a public site revealed that the AT&T T-Mobile acquisition might be more about eliminating the competition than anything else; an idea, which I’m sure, isn’t new. But for opponents of the AT&T T-mobile merger, this was something to rally behind. According to Savetheinternet.com, AT&T’s main pro-merger argument is that only by purchasing T-Mobile would it be able to expand its 4G LTE wireless data network to 97 percent of the population. As it turns out, AT&T considered building out the network themselves but balked at the 3.8 billion dollar cost. So, of course, the next logical move is to spend over 10 times as much acquiring T-mobile. Check out the details on savetheinternet.com.

Seems a bit fishy to me.

Some analysts are even saying that if the deal does go through, and AT&T and Verizon do end up controlling the vast majority of the market, it could mean more industry regulations to ensure that prices don’t go up. And that’s all that terrified me this week in the world of mobile solutions and telecoms. Back to you… 

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