Google's strategy for winning the smartphone wars: don't fight the smartphone wars

Why beat Apple if you can make money from them?

I missed this story when it went up, last week, but Business Insider's Nicholas Carlson has an interesting alternative take to the mainstream belief about how Google views Android. It's single sourced – attributed to "one ex-Googler" – but explains a few inconsistencies about the company's actions. The big starting point is the explanation for why Andy Rubin, Android's creator and leader, left the project unexpectedly at the end of March. Carlson writes:

Rubin told a room full of Google executives that Google-owned phone-maker Motorola was a hedge against Samsung growing too powerful.
Rubin's comments indicated a view of Android as something to preserve and protect.
Our source believes that Larry Page isn't nearly so worried about Android itself. This source says that Page views it as a means to an end.
He says Page views Google as "a cloud services company," built on cornerstone products like Search, Maps, Mail, and YouTube.

In other words, Andy Rubin was determined to make Android the best, and most successful, phone platform in the world. But while that's obviously the aim of Apple and Samsung, there's no direct reason why Google needs to "win" the phone wars. It makes more money from iOS than Android.

The obvious counterpoint to that is that Google spent $12.5bn buying Motorola in 2011. Why would it do that if it had no interest in taking on the hardware market? It appears the answer was lying in plain sight: when the purchase was agreed, Google claimed that it was Motorola's patent portfolio which it was after, and Carlson's source backs that up.

Even though Google obtained a world-class phone manufacturer lumped in with its patent purchase, it didn't ramp up its hardware business; the Nexus 4 was made by LG, and the company's tablets were made by Asus and Samsung. So what has it been doing? Carlson says it's been trying to boost the whole smartphone business:

Page wants Motorola to focus on better, longer-lasting batteries and faster chips, with the goal of pushing the entire phone-making industry forward.
Why?
So that Google's cloud-based services run better and can do more things on all kinds of mobile devices.

The theory is backed up by Page's choice to replace Rubin: Sundar Pichai, whose previous biggest success was securing widespread adoption of the Google Toolbar at PC manufacturers. If Pichai can make Google's web services as successful on mobile platforms as they are traditional ones, then it may not need an overwhelming success of the Android platform in particular to come out successfully from the smartphone revolution.

In that analysis, Rubin's Android team's success was actually the result of a failure of principle-agent management. His aim – to build the most successful smartphone platform – was not the same as Page's, nor, apparently, Google's overall.

Time will tell which of the two had the right idea. It certainly seems to be a waste of Google's burgeoning ability as a hardware manufacturer to refocus entirely on web services. The biggest threat for Apple remains that Google is getting better at hardware faster than Apple is getting better at online services, and it seems un-Google-like to simply cede that advantage. But if Google is genuinely in a situation where it can "win" whichever phone platform holds the lead, then that seems like a situation worth fighting to stay in.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Letter from Donetsk: ice cream, bustling bars and missiles in eastern Ukraine

In Donetsk, which has been under the control of Russian backed rebels since April 2014, the propaganda has a hermetic, relentless feel to it.

Eighty-eight year-old Nadya Moroz stares through the taped-up window of her flat in Donetsk, blown in by persistent bombing. She wonders why she abandoned her peaceful village for a “better life” in Donetsk with her daughter, just months before war erupted in spring 2014.

Nadya is no stranger to upheaval. She was captured by the Nazis when she was 15 and sent to shovel coal in a mine in Alsace, in eastern France. When the region was liberated by the Americans, she narrowly missed a plane taking refugees to the US, and so returned empty-handed to Ukraine. She never thought that she would see fighting again.

Now she and her daughter Irina shuffle around their dilapidated flat in the front-line district of Tekstilshchik. Both physically impaired, they seldom venture out.

The highlight of the women’s day is the television series Posledniy Yanychar (“The Last Janissary”), about an Ottoman slave soldier and his dangerous love for a free Cossack girl.

They leave the dog-walking to Irina’s daughter, Galya, who comes back just in time. We turn on the TV a few minutes before two o’clock to watch a news report on Channel One, the Russian state broadcaster. It shows a montage of unnerving images: Nato tanks racing in formation across a plain, goose-stepping troops of Pravy Sektor (a right-wing Ukrainian militia) and several implicit warnings that a Western invasion is nigh. I wonder how my hosts can remain so impassive in the face of such blatant propaganda.

In Donetsk, which has been under the control of Russian-backed rebels since April 2014, the propaganda has a hermetic, relentless feel to it. If the TV doesn’t get you, the print media, radio and street hoardings will. Take a walk in the empty central district of the city and you have the creeping sense of being transported back to what it must have been like in the 1940s. Posters of Stalin, with his martial gaze and pomaded moustache, were taboo for decades even under the Soviets but now they grace the near-empty boulevards. Images of veterans of the 1941-45 war are ubiquitous, breast pockets ablaze with medals. Even the checkpoints bear the graffiti: “To Berlin!” It’s all inching closer to a theme-park re-enactment of the Soviet glory years, a weird meeting of propaganda and nostalgia.

So completely is the Donetsk People’s Republic (DPR) in thrall to Russia that even its parliament has passed over its new flag for the tricolour of the Russian Federation, which flutters atop the building. “At least now that the municipal departments have become ministries, everyone has been promoted,” says Galya, wryly. “We’ve got to have something to be pleased about.”

The war in the Donbas – the eastern region of Ukraine that includes Donetsk and Luhansk – can be traced to the street demonstrations of 2013-14. The former president Viktor Yanukovych, a close ally of Vladimir Putin, had refused to sign an agreement that would have heralded closer integration with the EU. In late 2013, protests against his corrupt rule began in Maidan Nezalezhnosti (“Independence Square”) in Kyiv, as well as other cities. In early 2014 Yanukovych’s security forces fired on the crowds in the capital, causing dozens of fatalities, before he fled.

Putin acted swiftly, annexing Crimea and engineering a series of “anti-Maidans” across the east and south of Ukraine, bussing in “volunteers” and thugs to help shore up resistance to the new authority in Kyiv. The Russian-backed rebels consolidated their power base in Donetsk and Luhansk, where they established two “independent” republics, the DPR and its co-statelet, the Luhansk People’s Republic (LPR). Kyiv moved to recover the lost territories, sparking a full-scale war that raged in late 2014 and early 2015.

Despite the so-called “peace” that arrived in autumn 2015 and the beguiling feeling that a certain normality has returned – the prams, the ice creams in the park, the bustling bars – missiles still fly and small-arms fire frequently breaks out. You can’t forget the conflict for long.

One reminder is the large number of dogs roaming the streets, set free when their owners left. Even those with homes have suffered. A Yorkshire terrier in the flat next door to mine started collecting food from its bowl when the war began and storing it in hiding places around the flat. Now, whenever the shelling starts, he goes to his caches and binge-eats in a sort of atavistic canine survival ritual.

Pet shops are another indicator of the state of a society. Master Zoo in the city centre has an overabundance of tropical fish tanks (too clunky to evacuate) and no dogs. In their absence, the kennels have been filled with life-size plastic hounds under a sign strictly forbidding photography, for reasons unknown. I had to share my rented room with a pet chinchilla called Shunya. These furry Andean rodents, fragile to transport but conveniently low-maintenance, had become increasingly fashionable before the war. The city must still be full of them.

The bombing generally began “after the weekends, before holidays, Ukraine’s national days and before major agreements”, Galya had said. A new round of peace talks was about to start, and I should have my emergency bag at the ready. I shuddered back up to the ninth floor of my pitch-dark Tekstilshchik tower block. Shunya was sitting quiet and unruffled in his cage, never betraying any signs of stress. Free from Russian television, we girded ourselves for the night ahead.

This article first appeared in the 05 February 2015 issue of the New Statesman, Putin's war