Android is a perfect example of a business entangled with three issues: legal trouble /disputes, market share and profits. It all phases out over time. Right now the market share is leading the way, which normally would bring profit along the way. However, legal trouble lurks in the wing. The good news is that in the US one can expect justice in the legal debate so no need to bribe one’s way out to keep dirty profit.
In just three years, Android has become the king of mobile operating systems. But it’s only now starting to make money for Google, says Larry Page, Google’s chief executive.
“We are in the early stages of monetization for a number of our new products, and Android is one of those,” said Mr. Page, in response to an analyst’s questions about making money with Android. He said that Android had a strong advertising business and that its app store had served 11 billion downloads — many of which are free — to smartphone customers.
Android is free, open-source software that any manufacturer can use. Part of the reason it is not a bigger revenue generator is that many of the 250 million Android devices that Mr. Page said had been activated are not phones or tablets, where people see ads sold by Google, but rather gadgets like low-cost GPS navigators.
Google will generate over $3 billion in mobile ad revenue this year. But that’s still not much compared to the amount of money Apple makes from selling iPhone hardware.
Paradoxically, it might benefit Google for Android to produce less revenue, because of the continuing patent litigation over it.