Google Searches For Android Gains

MOUNTAIN VIEW, Calif. (TheStreet) -- Google's (GOOG) Android operating system may be viewed as a shot in the arm for smartphone makers such as HTC and Motorola (MOT), but the OS is also key to the Internet giant's long-term strategy.

The tech heavyweight has been frantically extending its reach beyond its traditional search business into areas such as video sharing, digital music and PC operating systems.

Against this backdrop, Android represents a gilt-edged opportunity for the company to extend its desktop search capabilities into new areas. If Google is planning an OS war with Microsoft (MSFT), then smartphones are the first significant battle.

With more than 10 devices and a number of service providers now in its camp, Android has done a good job dislodging the Windows Mobile operating system.

Apple (AAPL), Research In Motion (RIMM) and Nokia(NOK) pose a stiffer challenge for Google, although the search giant is certainly establishing itself as an OS player.

"We think the adoption of Android so far has been better than expected, with nearly 20 devices expected to be available by the end of the year," commented Youssef Squali, an analyst at Jefferies & Company, in a recent note.

With low-cost, scaled-down laptops, or netbooks, fast becoming the consumer technology du jour, the stage is set for Google. Although Android is unlikely to feature in mini-computers, the Internet firm has laid the foundations for its Chrome OS to mount an assault on Microsoft.

Microsoft, for its part, is attacking Google in its back yard through its Bing offering. The software giant has also clinched a search partnership with Yahoo! (YHOO) as part of its long-term plan to challenge Google.