Print 33 comment(s) - last by Tony Swash.. on Aug 12 at 3:40 AM

Google stands accused of using its Android smart phone market giant to crush the competition.  (Source: AP Photo)
Is Google abusing its dominant position to proselytize its services?

The world's most popular smartphone operating system, Google Inc.'s (GOOG) Android OS, can't seem to catch a break these days.  If its not being attacked in court [1][2][3][4][5by rival smartphone maker Apple, Inc. (AAPL) whose looking to forcibly remove its products from market [1][2] with lawsuits, it's being probed by antitrust investigators.

The U.S. Federal Trade Commission on Wednesday issued long awaited subpoenas.  For those of you who aren't lawyers and haven't been dragged through a major court case, a "subpoena" is a government demand for testimony or evidence.  Failure to give the requested information can result in criminal and/or civil penalties.

The fact that the U.S. government has issued subpoenas shows that it's getting serious about its investigation of Google.  A Google spokeswoman seemed nonchalant, commenting, "We understand that with success comes scrutiny. We're happy to answer any questions they have about our business."

But for all the cheer, the move is a major concern for Google.

Several small smartphone service providers have claimed that Google applied pressure to its hardware partners to boot their products off their smartphones, in favor of Google's rival services.  In and of itself, that might not be illegal were, Google not by far the industry's most dominant player in sales.  Android is reportedly outselling the next closest company, Apple, 5-to-2 in recent figures.  Thus if Google is found guilty of the allegations, it could face stiff penalties for violating antitrust laws.

Other allegations against Google include reports that it stole data from other services, such as reviews site Yelp and used it to bolster its own offerings.  And Google also stands of artificially boosting its services above competitors' in the results from its search engine -- the most used search engine on the planet.

The issue of the subpoenas was first reported by The Wall Street Journal.  Even if Google can beat the antitrust rap in the U.S. it faces similar accusations in Europe, a place known for its strict antitrust laws [1][2].  

Google has set aside $500M USD in cash to cover possible antitrust penalties.  The question is whether that will be close to enough.

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RE: Where is Google going?
By FeralMisanthrope on 8/11/2011 11:46:51 AM , Rating: 2
Google is attempting to capitalize on the inevitable commoditization and democratization of mobile computing. Before Android, smartphones were a lot like the IBM mainframes of old--proprietary hardware/software combinations that allow companies like Apple and RIM to drive high margins through vertical integration and customer lock-in. In a way, Google is trying to do for mobile devices what Microsoft did for the PC. Unlike Microsoft, Google monetizes its consumer products and services indirectly. I think it's still too early to tell if Android will be strategically good for Google. Aside from crowding out some noteworthy competitors like MeeGo and WebOS, Android has been huge win for consumers, developers, device manufacturers, service providers, and mobile computing in general. I doubt that I would even own a smartphone if not for Android, and I'm not the only one.

P.S. I really like your comparison of Google to an autistic savant! Of all the psychological maladies that can be used to describe a corporation, Asperger syndrome is certainly not the worst.

RE: Where is Google going?
By vision33r on 8/11/2011 12:39:20 PM , Rating: 2
Android is a large win for Asia as they were severely behind in the software engineering area. Android gave them a free mobile OS to use to go head to head against RIM, Apple, and Microsoft.

It's only a huge win for the US Carriers selling data plans. Very few American or European businesses are capitalizing on Android as much as Asia.

RE: Where is Google going?
By Tony Swash on 8/11/2011 1:54:39 PM , Rating: 1
I see some interesting responses to my comment but none address my key question. The question was not is Android a good thing, is it good for handset makers, is it good for consumers. The question is: is Android good for Google? And if it is - how?

As far as I can see even if every smart phone on the planet was Android, iPhone and WP7 crushed, it still wouldn't generate extra revenue for Google. It wouldn't solve Google's strategic problems with the post PC world. Google actually makes more per capita per iOS user than per Android user but both rates of revenue are much lower than per desktop user. So if in five years the web is the mobile device web and not the desktop web then Android will do nothing about solving the revenue resulting problems that that will cause Google.

RE: Where is Google going?
By AmbroseAthan on 8/11/2011 4:18:06 PM , Rating: 2
This was some good commentary on Android's purpose and business sense:

And here is some of the money analysis:

RE: Where is Google going?
By sprockkets on 8/11/2011 7:55:51 PM , Rating: 2
Dude, you aren't asking a question - you are posting a bunch of rhetorical nonsense meant to be posed as a question but with the effect of FUD. I see through it, and so do others.

You aren't genuinely asking for an answer, but if you were, the one you need is


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