SAN FRANCISCO -
took its first stab at competing with
in the mobile space by unveiling the Android operating system on the new
Now the true test will be if users pick up the device in enough numbers to make a dent in Apple's growing popularity with the iPhone.
Handset maker HTC came up with the device that will support the Android operating system -- the first phone on the market to do so. But with
T-Mobile unit as the exclusive carrier for the G1, it could limit Android's reach in the U.S., making it tougher for Google to take on the iPhone.
T-Mobile is the fourth largest carrier in the U.S., behind
respectively. AT&T is the exclusive carrier for the iPhone.
First Look: TMobile's G1 Google Phone
var config = new Array(); config<BRACKET>"videoId"</BRACKET> = 1801288198; config<BRACKET>"playerTag"</BRACKET> = "TSCM Embedded Video Player"; config<BRACKET>"autoStart"</BRACKET> = false; config<BRACKET>"preloadBackColor"</BRACKET> = "#FFFFFF"; config<BRACKET>"useOverlayMenu"</BRACKET> = "false"; config<BRACKET>"width"</BRACKET> = 265; config<BRACKET>"height"</BRACKET> = 255; config<BRACKET>"playerId"</BRACKET> = 1243645856; createExperience(config, 8);
Jeffrey Lindsay, an analyst for Sanford Bernstein, says the G1 also faces other challenges since it does not have a fully integrated system like the iPhone, which uses an Apple operating system.
"Apple is the market leader in basic design," Lindsay says. "It's in charge of the hardware and software, making it a huge advantage, which Apple would be well to preserve."
Apple has sold more than 6.1 million iPhones in its first year.
In the long term, however, Lindsay sees things tilting in Google's favor because Android uses an open platform, which allows developers to come up with new applications with fewer constraints than the iPhone. It also gives handset makers the freedom to design their own devices.
Lindsay likens the current battle between Google and Apple in the mobile space to the one waged between the PC and the Mac in the computer space in the early 1980s, "and Google is counting on the case study playing out the same way," he says.
Google has prevented the battle from turning into something more like the one between Apple's iPod and other music players in the market -- where the iPod has prevailed -- by setting standards upfront that can be more easily adapted. Lindsay points out that many music players that competed with the iPod ran into the problem of being incompatible with the various services, like for example, the Real Rhapsody music subscription service.
"That's why Apple's lead in iPods hasn't been shaken," he says. "But Google started by defining the standards first."
Charles Golvin, an analyst for Forrester Research, says he expects more carriers and handset makers to start coming out with their own devices that support Android and he already sees a groundswell of support from companies like Samsung and
, which are part of the Open Handset Alliance led by Google to create more openness on the mobile Web. There are 34 mobile operators and handset makers in the alliance.
Lindsay says more competition will lead to more aggressive pricing, giving the iPhone a run for its money. Right now, the G1 is priced at $179, compared to the iPhone's base price of $199. But the iPhone comes with more memory.
Golvin does not see much migration from the iPhone to the G1 since most users are locked into their contracts with AT&T, and breaking those contracts would be costly. He also predicts that a lot of the consumers who will go out and buy the G1 will already be savvy with using Internet on their mobile devices, although T-Mobile has said the G1 is intended for a mass audience.
As far as Google making money off of Android, only time will tell. Lindsay points out that the company is already capitalizing on mobile ads right now on other devices. And it has even predicted that in three to five years, there will be more users on mobile devices than on computers.
"Google is saying that themselves, so they have to be on the mobile platform," Lindsay says.