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First Apple, now Google -- who's up next for the phone game?

According to a story published in the Wall Street Journal, Google continues its development of the GPhone, a new prototype mobile phone that could be available to consumers within a year.  The Journal cited "people familiar with the plans" who claimed Google is showing the prototype to mobile phone manufacturers and mobile carriers.  So far, T-Mobile and Verizon Wireless have been the only two carriers approached by Google.

The company already has invested "hundreds of millions of dollars" into the project, according to Journal sources.  Users will likely get a free subscription because Google plans to bundle advertisements with several of the phone's applications.

Even though Google services are already available on a number of phones, this report indicates a further expansion into the world of mobile phones.

"What's interesting about the ads in the mobile phone is that they are twice as profitable or more than the nonmobile phone ads because they're more personal," said Eric Schmidt, Google Chief Executive.

The report indicates Google's main goal behind the project is to snap up a big portion of the growing advertising market for mobile phones.  GPhone users will reportedly be able to use the Google search engine, e-mail, WiFi, Google Maps, along with GPS and camera abilities.

Google still refuses to turn over any solid information about the possibility of a Google mobile phone, but has said it is is working on products that can be used on mobile devices.

While the popular Apple iPhone relies heavily on initial sales from the $499 or $599 price tag, Google would collect revenue dollars through various advertising channels.

In an official statement published by Google, the company neither confirmed nor denied the reports of a GPhone.  The company admitted it is working with mobile phone carriers and phone manufacturers, but did not go into specifics.


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Interesting
By rockyct on 8/6/2007 1:08:59 AM , Rating: 2
The rumors still sound a little iffy, but very encouraging. I think the iphone is a nice device, but way overpriced. If anything, a "gphone" would make Apple lower the price and make it available on something other than ATT's inferior network.

Also, I wonder if they're are hoping to eventually tie a gphone in with the frequency bandwidth they want to buy.




RE: Interesting
By alifbaa on 8/6/2007 1:45:19 AM , Rating: 5
I'm sure that's precisely what they're trying to do.

Integration of telecommunications/video/internet/PDA into a single mobile device is clearly where we're heading. The possibilities of what these things will do for us in the future are endless, and every company with anything to do with any of these areas is getting into this hard core right now.

Out of all the companies involved, I think Google clearly has the most innovative and intriguing ideas for what these devices will do. They clearly have a far better understanding of the market and its future possibilities than Apple or any of the mobile phone companies do right now. It will be interesting to see what Palm and RIM come up with. We still haven't heard much from them yet.


RE: Interesting
By Ringold on 8/6/2007 3:54:15 AM , Rating: 4
What amazes me is the ability for Google to spool up from essentially nothing not all that many years ago and become a massive technology conglomerate, all while not losing its luster and not seemingly sacrificing anything at all. One would expect perhaps poor management -- management is superb. Poor execution, born of a system that faces decisions on a larger scale every week? Doesn't seem to be a problem. Nary a blemish! Google just continues to be "hot"; current products stay hot, it enters hot new markets, makes old markets hot again, and continues to attract the cream of the crop -- not just in IT, but in every field it enters. I'm not even a shareholder (at the moment), I'm just genuinely impressed.

It makes one wonder how long it'll last, but thus far the sun has yet to set on the Google empire.


RE: Interesting
By feraltoad on 8/6/2007 6:26:35 AM , Rating: 2
Add to the paradox that they seem to make money by giving things away. If there's a Googleocracy, I'll take it.


RE: Interesting
By spluurfg on 8/6/2007 7:46:50 AM , Rating: 3
What I find most ironic is that Bill Gates was one of the earliest who spoke about the concept of convergence and the information superhighways -- that one could have all information, entertainment, and communication accessible at any time, in any place. I'm not sure if any of you read his book The Road Ahead which was out years ago. Very ironic then that Microsoft's archrival seems to be making the most inroads on this vision.

Somehow vision is what I think Ballmer lacks...


RE: Interesting
By iFX on 8/6/2007 10:40:21 AM , Rating: 3
Yup. Billy told us about all of this years and years ago - no one at the time had the technology or the vison to see where his ideas were headed.

It's fun to see the technology catch up to Billy's ideas ten + years later.


RE: Interesting
By masher2 (blog) on 8/6/2007 9:46:44 AM , Rating: 5
> "Google just continues to be "hot"; current products stay hot, it enters hot new markets, makes old markets hot again, and continues to attract the cream of the crop "

Google has indeed entered many new markets, but its only making a profit in two areas: ad/keyword marketing, and by using its massive stock price to purchase existing companies.

Its wholly new ventures certainly have attracted a lot of buzz, but they're not generating much in the way of dollars.


RE: Interesting
By rdeegvainl on 8/6/2007 1:51:20 AM , Rating: 2
Apple will not lower it's prices in the face of a direct competitor.
Look at all their products. Apple is a company that ignores conventional business standards and still makes incredible money. They are an anomaly of the corporate world.


RE: Interesting
By Ringold on 8/6/2007 3:59:31 AM , Rating: 2
I dont know.. their computer business stays within the realm of sanity in pricing compared to the PC competition, but their iPods simply face no credible competition. Not to say there arent better products, but when the company fails to make it sell, well, there's no credible competition.

A gPhone, on the other hand, would be a direct challenger. What happens when two of the largest icons in the realm of Geekdom face off in the realm of the radio spectrum? The universe may collapse, for one. But if the gPhone is just as appealing as the iPhone, Apple would either respond or be left with nothing but it's tiny cohort of hard-core followers that never left them (nor bathed) through the 90s. I think Jobs is a man out to win my capitalist heart, so he'll respond for sure, either on pricing or making the iPhone somehow better.


RE: Interesting
By rdeegvainl on 8/6/2007 7:14:44 AM , Rating: 2
But the reason the Iphone is hot, is the mass following it got with the Ipod. Even if the Gphone is a great product it will still not affect Apple very much. Maybe after the Gphone takes a lead position for a couple years if it can do that, but by that time there will be another model of the iphone and the older ones would have dropped in price already. Look at the current Iphone, It doesn't use G3, has exclusivity to certain plans with ATT, doesn't allow user created apps. I would imagine that the Gphone would be all about the best and most open it can be. And there is where I think they are targeting different audiences. Iphone would go after the Elitist and ignorant(not an insult, just a statement as to people's priorities with technology, and lack of understanding) people who have to have the BIGGEST BEST THING, and a Gphone would be more reasonable priced and go after those who know what to look for and what they want.
My guess is that unless the Iphone does bad, irregardless of the Gphone, they will drop the price. and that Apple will not base their prices on the success of other platforms.
They've been doing their own thing and doing well, even if the competition is doing another thing and doing better.
But Gphone may still surprise us. Though i am kind of interested in openmoko.


RE: Interesting
By idconstruct on 8/8/2007 12:23:20 AM , Rating: 2
quote:
Iphone would go after the Elitist and ignorant(not an insult, just a statement as to people's priorities with technology, and lack of understanding) people who have to have the BIGGEST BEST THING, and a Gphone would be more reasonable priced and go after those who know what to look for and what they want.


You ripped those words right out of my mouth :P

well said


RE: Interesting
By MykC on 8/6/2007 7:56:43 AM , Rating: 2
That not true, Apple will lower the price of the their products in the face of competition. Just before the Zune launched they cut the prices on the hard drive based line of Ipods.


RE: Interesting
By iFX on 8/6/2007 10:43:39 AM , Rating: 2
The iPod saved apple - years and years of charging whatever the heck they wanted for their PCs nearly put them our of business - TWICE.

Without the iPod apple is nothing - the truth is people across the globe aren't chomping at the bit to buy apple PCs - and they never have. This isn't a judgement against their technology or quality - just one against their sanity. Apple makes a fine PC - people just don't seem to want them all that bad.


RE: Interesting
By Griswold on 8/6/2007 4:26:29 AM , Rating: 1
You assume just because google is google, the so called gphone will be so special, apple has to lower the price for their iphone? What about the real 800 pound gorillas in the cage? Nokia, Samsung, Motorolla? Are they already out of the equation for success?

A reminder: Nokia just reported a record quarter with net earnings of 2.3 billion euros (+148%) and 110 million (+29%) sold phones for the past quarter.

If you hope for lower prices, it will only happen if a giant like nokia offers a premium phone for a not so premium price - not google.


RE: Interesting
By jmunjr on 8/6/2007 5:23:33 AM , Rating: 2
I thought because Apple was Apple the iPhone would be so special, but guess what, a month after its release everyone realizes it isn't anywhere close to what the hype said it would be, and in many cases it is worse than what it replaced.


RE: Interesting
By masher2 (blog) on 8/6/2007 10:27:42 AM , Rating: 2
Actually, the latest marketing research data I've seen says that 77% of consumers who purchased an iPhone are in the "very satisfied" category, the highest of all phone manufacturers.

That compares to figures of 50% for Blackberry, 36% for Motorola, 34% for Palm, and 29% for SonyEricsson.

http://www.intomobile.com/2007/08/02/changewave-su...


RE: Interesting
By djcameron on 8/6/2007 11:26:04 AM , Rating: 3
But any nerd or iBot that stood in line to get an iPhone would never admit that it didn't live up to his expectations.


RE: Interesting
By theapparition on 8/6/2007 12:05:59 PM , Rating: 3
You can't be serious. Your referencing a study that's based on 1month of service, clearly by overzealous early adopters, and with a very, very small sample of adopters. Compare that to a signifigantly larger base of blackberry users, or motorola, etc. That's like seeing a book rating of 100% on Amazon where only 1 person has reviewed it, meaningless. Let's see in a year or two where that percentage lies. It may go down, or up. But hardly a proper study.

You've had some smart points before, but this isn't one of them.


RE: Interesting
By masher2 (blog) on 8/6/2007 12:35:00 PM , Rating: 2
> "That's like seeing a book rating of 100% on Amazon where only 1 person has reviewed it, meaningless."

A statistical sample of 1 is meaningless indeed. But this was a random sampling of 3,003 people, which is most definitely a sample set large enough to be statistically valid.

Your second point is that new owners of any handset are typically happier with this purchase than those who have owned for a longer period of time. That may be...but it's not relevant to the point I was addressing. The OP implied that iPhone owners were rapidly becoming disillusioned with their purchase. I pointed out-- with hard supporting data-- that nothing could be further from the truth.


RE: Interesting
By Oregonian2 on 8/6/2007 1:44:52 PM , Rating: 2
I dunno. 77% seems kind of low when taken in context with the hype. Seems like anything lower than 99% is a failure of some sort.


RE: Interesting
By theapparition on 8/6/2007 6:35:08 PM , Rating: 2
You can prove or unprove anything statistically with the right set of conditions, but that another issue.

There is absolutely a placebo effect, in that early adopters of expensive technology will often overestimate the value of the purchase to offset feelings of buyers remorse. In this case, they have to justify to themselves the purchase of this phone. There's the apple effect, which to apples' credit, has a base of the most loyal customers out there. Add that to the fact that owners have only had this for 1month, and it is not statistically valid. Perhaps, it would be more valid, if the same comparison was done 1month after the latest blackberry release (for example). Time and early adoption out of the equation, we'll see how the iPhone stacks up in the long run.

The article also states that 16% of people will switch to the iphone rather than renew current contracts. Are you prepared to agree that the iPhone will have 16% market share in 2 years? That's even blowing Apple and ATT's estimates out of the water.


RE: Interesting
By theapparition on 8/6/2007 6:46:40 PM , Rating: 2
Worth further note that not all of the 3,003 people surveyed had iPhones. Out of that 3,003 only SOME owned iPhones and reported 77% satisfaction. The others owned the phones from motorola, blackberry, samsung, etc. Now that statistically small sample is getting much smaller. The article didn't break down the exact numbers, so who knows, but it could be something like 7 out of 9 liked the phone, which 9 people is not statistically valid. Or it could be that almost all have the iPhone, but that would skew the unfavorable results of the other phones. Without proper numbers, I tend not to believe the conclusions.


RE: Interesting
By masher2 (blog) on 8/7/2007 1:06:03 AM , Rating: 2
> "The article also states that 16% of people will switch to the iphone rather than renew current contracts. Are you prepared to agree that the iPhone will have 16% market share in 2 years? "

You've made a few mistakes in coming to that conclusion. First of all, the 16% figure isn't of all consumers, but only those who are planning a new phone purchase. A large segment of the market keeps a phone for 3 or more years. Second of all, a person "considering" an iPhone is not one who will definitely purchase. Taken together, these two facts mean the survey does NOT imply a 16% market share for Apple in the near future.

You can deny the figures all you wish, but the simple fact remains that no mobile phone has ever scored such a high customer satisfaction rating, not since ChangeWave began taking statistics. The actual number of those "extremely satisfied" may be above or below the 77% figure cited, but its undeniable that most iPhone owners are very happy with their purchase.


RE: Interesting
By theapparition on 8/7/2007 9:09:18 AM , Rating: 2
quote:
You've made a few mistakes in coming to that conclusion.

Yes, after posting I re-read the article and see that it was 16% of changewave alliance members, which is not indicitive of the general market. So I retract that. Oh for an edit function.

However, without proper explanation of the numbers, we don't know how many iPhone users particiapated, which calls into question the statistical relevance of the study. Which you touted but failed to address.

I'm sure a very high percentage was happy 1month after their blackberry purchase, too. It's only after thousands of users and many years has that rating stabilized at 50%. I'm only asking, before believing any numbers, we let a proper analysis happen.

Personally, I could care less whether anyone is happy or displeased with their purchase. I Just know its not relevant to compare a new product verses established products with varying product lines. For example, comparing to Motorala, they have hundereds of phones, some have been outright lemons. You want to compare apples to apples (pun intended), that is Motorola's top end device vs Apple's top end device, after 1 month of service (initial quality) with the same carrier to accurately compare results. Anything else is just marketing fluff. Surely you can see that.


RE: Interesting
By GoatMonkey on 8/6/2007 8:06:19 AM , Rating: 2
quote:
eventually tie a gphone in with the frequency bandwidth they want to buy.


That's interesting. Maybe they will resell it to stores to send out targeted advertising based on location.

I actually hope they have a pay version with no advertising if it's a good phone otherwise.


RE: Interesting
By Chaser on 8/6/2007 10:15:52 AM , Rating: 2
As a person that travels considerably from coast to coast I have used phones on the Sprint, Nextel, Verizon and AT&T networks. I travel and reside for several weeks at a time in rural towns and also in with most major cities. What I have learned is that network superiority and/or inferiority has many factors involved in terms of reliablity such as location and the phone you are using. I have never found one company to stick out more than T-Mobile. T-mobile's 1900Mhz only network is consistently horrible except in urban areas. Leave the city area or go off the highway and its over.

Otherwise I've found both Verizon and AT&T to be very good just about everywhere. Sprint/Nextel a bit better than Tmobile but not not much.


RE: Interesting
By Oregonian2 on 8/6/2007 1:47:41 PM , Rating: 2
Verizon and AT&T are the two largest cellular companies so that result is perhaps not surprising. I think AT&T is the larger by a little but Verizon is growing faster so one might expect Verizon to pass AT&T before too long.


RE: Interesting
By S3anister on 8/14/2007 9:04:00 PM , Rating: 2
unfortunately this like most all other google products will remain in beta and never actually meet final production


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