If Google Does Build A Phone, What Network Will It Run On?
TechCrunch’s Michael Arrington has been one of the most vocal supporters of the Android operating system. He’s written endlessly about the virtues of the open network, which lets him bypass evil telecom companies, like AT&T (NYSE: T), by using Google (NSDQ: GOOG) Voice.
Now, he’s salivating over what’s next,, and if he has the rumors correct, Google is close to releasing its own branded phone that will be sold through retailers, and built by a major phone manufacturer, like HTC, Samsung or LG (SEO: 066570) (Google said no comment today, but in the past has said it has no such intention of building a phone.) Arrington believes the phone will be everything the iPhone is, plus everything that it isn’t: “There won’t be any negotiation or compromise over the phone’s design of features – Google is dictating every last piece of it. No splintering of the Android OS that makes some applications unusable. Like the iPhone for Apple (NSDQ: AAPL), this phone will be Google’s pure vision of what a phone should be.”
But the bigger—and, frankly, more important—unknown that Arrington doesn’t address very extensively is this: Which network would this perfect phone work on?
Most phones today are bundled and sold through a carrier. If Google sells the phone independently via retail outlets, then how would people get connectivity? Surely, not just through free Wi-Fi. And, in order to give users choice, the phone would have to have so many radios, it would be prohibitively expensive. Arrington suggests in a separate post that AT&T might be the partner, and it may just be a data-only device. In my mind, I think there’s another option: To release a device that can leverage the new 4G networks that will just be rolling out.
The option is far more appealing and feasible than partnering with a traditional carrier. Google is an investor in Clearwire (NSDQ: CLWR), which is building a nationwide 4G wireless broadband network. Google could embed a mobile WiMax chipset into the phone, which would connect to Clearwire’s network. When the user leaves the Clearwire territory, it could roam on to Sprint’s CDMA network, which is Clearwire’s majority owner. The reason why this could work is because unlike other carriers, Clearwire promises to be completely open and hands-off when it comes to the devices running on their network. Not to mention, Clearwire has retail outlets and partnerships with big-box retailers like Best Buy and Fry’s. In order to reach consumers, Google would need those distribution points.
This would be a huge boost to Clearwire since investors and analysts have questioned how Clearwire will fair in the marketplace. Last week, the Kirkland-based operator received commitments for up to $1.56 million in equity and up to $500 million more from a pending common stock and bond offering. That was critical to being able to afford its fast rollout. Clearwire affirmed that it’s on track to roll out 4G services to more than 30 million people this year in 25 markets, and as many as 120 million people by the end of 2010. Arrington believes the phone will be ready in the first quarter.
This is more far-fetched, but Clearwire’s other investors include Comcast (NSDQ: CMCSA), Time Warner (NYSE: TWX) and BrightHouse, which will be looking for devices to sell as part of a broadband/TV/phone bundle. Google’s device may fit the bill, which will result in lots of big brands backing and selling the device with big promotional dollars.
This holiday season was supposed to be the biggest in history in terms of the number of smartphones for sale. But hold on to your seats, the mobile space may be just get a whole lot more interesting.
Posted In: Mobile, Technologies / Formats, 3G, 4G, Broadband, WiMax, Companies, Apple, iPhone, AT&T, Clearwire, Comcast, Google, Android, Sprint Nextel, T-Mobile, Time Warner, Verizon
