The mobile world according to Google

Our story about Dell collaborating with Google to launch the first Gphone has certainly got the blogosphere humming. For the record, Google was rather more emphatic in repudiating the forthcoming Mobile World Congress (formerly 3GSM) telecoms conference at Barcelona as a launch platform for the project than in denying the existence of the project itself.

That, of course, does not necessarily mean it will come to pass. After all, there is plenty of mileage for both parties in simply stimulating the rumour mill with a placatory “no comment”. Which is exactly what Dell did.

Dell is in particular need of new glory. The recent and drastic consolidation of its worldwide marketing services budget into WPP Group is just one small instance of a troubled company rapidly rethinking its global strategy. PC manufacturing isn’t what it was, and what there is of it seems to be benefiting HP and Lenovo more obviously than it is benefiting Dell. Opening up a second line in higher-margin PDAs was an obvious way forward. Except that HP proved better at it and Dell has since discontinued the idea, favouring instead selling smart phones from the likes of Nokia.

But that sounds like a holding operation while Dell thinks up a better idea. And that better idea could well be an Android-based mobile phone that leapfrogs the competition at a price we can all afford. The fact that Dell has relatively little expertise in this sector has partly been offset by its import of senior Motorola executive Ron Garriques (MW, March 1) to run Dell’s new global consumer group.

That still leaves a few little matters outstanding, such as who or what is going to provide the finer detail on the handset architecture? And who or what is going to provide the carriage? Never mind, though: there’s strategic sense in the idea.

We have ways
As for Google, let’s face it, it’s been very clever if disingenuous about the whole Gphone project. There’s no doubt that a company with a £90bn market capitalisation could engineer such a handset and indeed market it. Rumour (the only available weather vane in this particular, foggy, world) had it that Google was working with HTC, a Taiwanese handset manufacturer, on the Gphone. A collaborative relationship with Dell seems no less plausible. But the point is, Google doesn’t need to produce anything, except co-operation.

Which is exactly what it got when it led everyone up the garden path, eventually unveiling (last November) not a Gphone, but a new open-source mobile phone software platform called Android. About 36 handset, software and network suppliers have already pledged to make the Gphone project a reality.

Such a proxy strategy makes a lot of sense. Google, essentially a software technology company heavily dependent upon advertising for its revenue, no more needs to manufacture a handset to monopolise the mobile market than it needs to manufacture a computer to dominate the internet. Indeed, such issues are probably best left to others more expert in the field – so long as you can control them. We only have to look at Coca-Cola and its strategic blunder into the European bottled water market to realise that correct insight, market size and power do not of themselves guarantee success. You need friends as well.

So Android offers Google a degree of protection from market failure. But, more importantly, it is also putting a squeeze on the telecoms industry – from vendors to carriers – to produce the kind of low-cost mobile “third window” opportunity, internet friendly (unlike the platforms of today), where Google could reasonably expect to become the driving force.

The advertising parallel
Google’s approach to Gphone seems highly reminiscent of its approach to mastering the world of display advertising. It has fostered a wide range of collaborative projects with those who are experts in the field without getting too close to any of them (whatever Publicis’ Maurice Levy may choose to believe to the contrary). Or, for that matter, actually declaring its hand. The effect is similar. Advertising groups are unsure whether to regard Google as friend or foe; but they dare not withhold their cooperation all the same – for fear that they may be left behind. There’s a lesson in here, somewhere, for the Vodafones and T-Mobiles of this world. They too are traditional networks with strong brands in a rapidly changing world.

Meantime, the Dell Gphone rumours will do no harm, no harm at all, in reminding the telecoms world to get on with it, or wither on the vine.

Stuart Smith

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here