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Will Verizon-Google deal finally bring end to iPhone craze?

Watch out Apple! The Verizon-Google deal promises to bring more Android devices to market and could mean an end to the iPhone craze.

Verizon Wireless and Google have partnered to leverage the carrier?s network and the Android open platform to deliver mobile applications, services and devices to customers. Both companies view this agreement as an opportunity to offer consumers an array of products. But industry members see a potential battle erupting.
 
?Both companies are committed to providing substantial resources over the next couple of years to bring the latest applications and devices to our customers on third generation and fourth generation networks,? said Lowell McAdams, president/CEO of Verizon Wireless, Basking Ridge, NJ.

Verizon Wireless claims it operates the nation?s most reliable and largest wireless voice and data network, serving 87.7 million customers.

In November 2007, Google collaborated with T-Mobile, HTC, Qualcomm, Motorola and other Open Handset Alliance members on the development of Android, an open and comprehensive platform for mobile devices.

Apple beware
Many in the mobile industry agree that when someone controls a platform, it stifles innovation. Google?s open Android platform has been said to level the playing field.

So now with this new partnership, Google is undoubtedly increasing Android?s marketshare.

?Verizon is the largest U.S. wireless provider and this partnership is a really big deal for us,? said Eric Schmidt, chairman/CEO of Google, Mountain View, CA. ?It is a major milestone for the Android platform.

?Android now powers over 9 devices in 26 countries with 32 carriers in 19 languages,? he said. ?This is our third U.S. carrier to commit to the Android platform.

?The open platform benefits the entire mobile ecosystem: carriers, handset makers and developers. This partnership brings more Android devices to market.?

With just one handset, should the Android?s arch-nemesis ? Apple ? fear the partnership and will it make Android a formidable force in the wireless industry? 

?First I just want to say that it is great news for mobile advertising and consumer engagement,? said Marcus Startzel, senior vice president of sales at Millennial Media, Baltimore, MD. ?Advertisers care about reaching and engaging their consumers and the Android platform is proving to be a rich environment for advertisers to use rich media and other compelling advertising experiences.

?I think Apple is probably planning for this in some ways,? he said. ?But Android devices are launching on every carrier in the U.S. except AT&T and the iPhone?s limitation is reach.

?If Android can create a phone that breaks through the clutter, then it will be significant.

Apple?s current exclusivity agreement with AT&T runs out in June 2010. If the agreement is renewed, then Android has a good chance of sweeping up the marketshare.

However, if Apple decides to start offering the iPhone through other carriers then a full-fledge war will break.

Additionally, there is a sleeping giant at the sidelines of all of this: Research in Motion.

BlackBerry phones have a significant percentage of the handset market and as the phones become more and more accepting of rich media and a new ?super? BlackBerry phone is launched, the industry will experience a serious battle.

RIM?s BlackBerry is now the third most popular mobile phone for browsing the Web in the United States, accounting for 14 percent of all mobile traffic. BlackBerry is also placed fifth in Britain and worldwide, above Apple?s iPhone, according to Bango.

Additionally, in a recent study by Handango, BlackBerry displaced Windows Mobile to become the dominant platform within the smartphone content catalog.

According to AdMob, Android currently accounts for about 5 percent of the U.S. smartphone market. The iPhone generates about 33 percent of smartphone traffic worldwide and 50 percent in the U.S.

A whopping 97 percent of BlackBerry requests came from their OS Version 4.2 or higher, per AdMob.
It is hard not to wonder what else BlackBerry has under its sleeve.

Verizon?s open strategy
Verizon began providing customers the option to use, on its nationwide wireless network, wireless devices, software and applications not offered by the company in the end of 2008.

In early 2008, the company published technical standards the development community needs to design products to interface with the Verizon Wireless network.

Any device that meets the minimum technical standard can be activated on the network. Any application the customer chooses is allowed on these devices, further demonstrating the carrier?s commitment to openness.

As a result of their partnership, the two industry leaders will create, market and distribute products and services, with Verizon Wireless also contributing the breadth of its nationwide distribution channels. 

Consumers will be able to buy products resulting from the collaboration in Verizon Wireless retail and online stores.

?One main thing from one of our studies was that Verizon didn't seem to offer great smartphones to its customers,? said Doug Helmreich, program director with CFI Group, Ann Arbor MI. ?We also found that customers seemed relatively satisfied with Android. So if Verizon offers Android phones, then its likely Verizon will see a good adoption rate from its customer base.

?Apple should be worried about anything that threatens its dominant position,? he said. ?I doubt that Android phones on Verizon will make a huge dent in the iPhone's share, at least at first, but we do believe that if Verizon can offer more customer-friendly phones (like Android, Pre, or iPhone), and if Verizon doesn't suffer any network problems as a result of those phones getting increased use, then that would be good news for Verizon and bad news for Verizon's competitors.

?And we certainly know Google doesn't enter markets for fun. They play to win.?

Verizon and Google plan to codevelop several Android-based devices that will be preloaded with applications from both parties as well as third-party developers. 

The family of Android phones on the Verizon Wireless network will come from leading handset manufacturers.

The agreement will come to fruition within the next few weeks as Verizon Wireless introduces Android-based handsets.

?Together we will codevelop a family of Android devices,? Verizon?s Mr. McAdams said. ?They will be loaded with apps from both our companies and third-party leading-edge companies around the world, creating a compelling mobile experience for customers."