Google CEO, Sundar Pichai, has published a post on the official Google Blog defending the company after it was fined a record-breaking £3.8 billion. The post, titled “Android has created more choice, not less” gives you a clear indication of his mindset following the EU decision.
Straight off the mark, the Google CEO highlights the popularity of Android, noting that the operating system has “expanded the choice of phones available around the world.”
A valid point, but perhaps not enough to exempt them from a fine. What does raise eyebrows is the suggestion that this decision may affect the current Android business model, with consumers ultimately bearing the brunt of this decision.
Google CEO Responds
Pichai argues that the European Commission’s decision completely ignores the fact that Android is in direct competition with iOS phones – noting that 89% of the Commission’s own market survey acknowledged this. Additionally, he implies that the decision could be potentially damaging to millions of customers, as well as network operators and phone makers.
He said: “It also misses just how much choice Android provides to thousands of phone makers and mobile network operators who build and sell Android devices; to millions of app developers around the world who have built their businesses with Android; and billions of consumers who can now afford and use cutting-edge Android smartphones.”
Goodbye Open Source Android?
If Google is forced to unbundle its apps, Pichai hints, then this could radically alter the firms current business model and upset a delicate software ecosystem.
“If phone makers and mobile network operators couldn’t include our apps on their wide range of devices, it would upset the balance of the Android ecosystem.”, he said, adding that “so far, the Android business model has meant that we haven’t had to charge phone makers for our technology or depend on a tightly controlled distribution model.”
Pichai also commented that following the decision, the company was “concerned that today’s decision will upset the careful balance that we have struck with Android, and that it sends a troubling signal in favour of proprietary systems over open platforms.”
Essentially, Pichai suggests that the current free Android business model has relied on the process of app bundling, and by preventing the firm from doing this it may be forced to implement stricter, costlier processes. This could damage the entire ecosystem; from Google, to network operators, right the way along to software developers.
Spitting the Dummy Out?
Are we really seeing the disintegration of Android as we know it, or is this a reactionary statement aimed at garnering sympathy? Maybe a bit of both…
This blog post by Pichai is likely a dig at the European Commission and a slight warning to consumers and industry itself; be prepared to pay…maybe. As it stands, if phone makers are able to bundle their own browsers instead of Chrome (in turn sending traffic toward rivals) then this could damage Google’s mobile ad revenue.
When one considers that more than 50% of the company’s net digital ad revenue comes from mobiles, well it becomes clear how critical this is to Google. This ‘business model change’ that Pichai speaks of may indicate they are considering licensing Android to phone makers. This outcome, however, relies heavily on consumers actively avoiding Chrome or Google search on Android devices once services are unbundled.
Google dominates in search and browsers, and its popularity is near unrivalled globally. For it to suggest that this unbundling will cause such a cataclysm appears reactionary.