5 Reasons Google Android Has Peaked

Android's blistering success sees a whole new set of challenges.
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NEW YORK (TheStreet) --Chill the champagne, raise the balloons to the rafters and prepare for the upcoming moment when Google (GOOG) - Get Report Android phones overtake Research In Motion's (RIMM) BlackBerry as No. 2 in smartphones worldwide.

The

astonishing rise of Androids

from 0.7 million phones a year ago to 10.6 million phones as of the end of June has proven to be one of the biggest strategic moves in tech since, well, since

Apple

(AAPL) - Get Report

decided to get into the phone business.

But that breakneck zero-to-60 dash was at a pace that Google has no chance of repeating ever again.

Riding the touchscreen trend launched by iPhone in 2007, Apple and Android phones were essentially the only two players in the game. Now that wide-open field is changing shape.

Here are five reasons why the Google Android heyday is ending.

No. 5: Hewlett-Packard's Palm OS

Palm

created one of the best touchscreen operating systems to rival Apple's iPhone.

Hewlett-Packard

(HPQ) - Get Report

pickup of Palm gives it a viable smartphone software to power its mobile device attack.

No. 4: Nokia

Down, but not yet out,

Nokia

(NOK) - Get Report

, the Finnish phone colossus which still ranks as the world's largest smartphone player, could

make a go of MeeGo

, its restart in smartphone software.

If Nokia puts together even the slightest success with MeeGo, it will come at Android's expense.

No. 3: Microsoft Windows Phone 7

The idea of a Windows phone sounds about as bad as a Microsoft Vista computer. But a vastly-improved Windows 7 redeemed Microsoft's PC operating system business. Now the company hopes the same restorative medicine can work in mobile phones.

You can look for a blitz of Windows Phone 7 devices arriving ahead of the holidays. And here's a hunch, with the

AT&T

(T) - Get Report

and Apple exclusive partnership coming to an end, Microsoft could play a big part in filling the iPhone void.

No. 2: RIM BlackBerry 6

The BlackBerry Torch touchscreen slider phone certainly didn't light a bonfire of sales as some may have hoped, but it may have done enough to keep BlackBerry users from lighting out to Androids or iPhones.

No. 1: Verizon iPhone

Android's greatest threat is that the iPhone moves to

Verizon

(VZ) - Get Report

.

AT&T and Apple had access to a large swath of the market, but the biggest portion, some 92 million people, are at Verizon. Apple needs that new market to boost sales.

Verizon has forged a friendly partnership with Google to push the Droid campaign.

HTC

and

Motorola

(MOT)

have supplied five Android-powered phones to Verizon and nearly all of them have been sellout successes.

But Android has been seen as the iPhone alternative. If Verizon has the iPhone, it won't need as strong an alternative.

--Written by Scott Moritz in New York.