Don't let it get away!
Keep track of the stocks that matter to you.
Help yourself with the Fool's FREE and easy new watchlist service today.
Google (NASDAQ: GOOGL ) is widely expected to unveil the next version of its mobile system, Android 4.4, "KitKat," sometime in the very near future. The last major update to Android, Jelly Bean, brought a number of major improvements to Google's mobile operating system -- KitKat could be even more significant.
If the rumors prove true, Google could be about to make a number of major changes to Android, some of which will have a major effect on both Apple (NASDAQ: AAPL ) and Microsoft's (NASDAQ: MSFT ) competing efforts.
Going after the emerging markets
Most readers probably won't be affected by this, but if Google makes this change, it could impact literally billions of people: According to Amir Efrati, Google is planning to focus heavily on low-cost handsets, allowing the next version of Android to work just as well on high-end devices as it does on cheap ones. The report isn't surprising, similar rumors have been circulating for months.
While expensive Android handsets all come with the latest version of Google's operating system, cheaper devices (popular in emerging markets like India) still frequently ship with older versions of Android. Nevertheless, Google dominates these markets. For the most part, if you're in the market for a smartphone that costs less than $100 it's Android or bust.
But that's changing. Mozilla's Firefox OS -- running on phones like ZTE's $80 Open -- is aimed at emerging markets, and though Mozilla has said it isn't going to take on "Fortress Google," the growth of Firefox OS could limit Android adoption in these markets.
Likewise, Microsoft, in its quest to turn Windows Phone into a legitimate mobile platform, has said that it will spend the next year aggressively courting consumers in emerging markets. The Lumia 1320 is a new, low-cost phablet that should appeal to many buyers in Asia; other cheap phones running Microsoft's mobile operating system, including the Lumia 520, have started to gain traction in countries like India.
Wearables as the next big thing
In addition to reducing fragmentation in emerging markets, Efrati also reports that Google plans to focus on wearables, building support for such devices into Android itself. Most specifically, Efrati claims that KitKat will support three types of sensors: geomagnetic rotation vector, step detector and step counter.
Such sensors could prove integral to Google's smartwatch effort. The search giant has been rumored to have its own watch in the works for months, with some reports suggesting the watch could be unveiled alongside KitKat. If it is unveiled then, it probably won't go on sale for months -- according to The Wall Street Journal, Google is only now preparing for mass production.
Apple, too reportedly, has a watch in the works. The new iPhone 5s includes an M7 co-processor, designed to monitor fitness activity, and Apple's management has promised new devices in 2014. Cantor Fitzgerald analyst Brian White has said he believes Apple's iWatch will ship before the end of next year.
Is Google going to conqueror the living room?
Perhaps most interesting are reports that Google could use KitKat to take over the living room. ETNews reported last week that KitKat will feature improved connectivity between mobile devices and smart TVs. Google's previous attempt at the effort, Google TV, was widely regarded as a failure. Now, Google is reportedly prepping "Android TV" to replace it.
Efrati's leak is less interesting -- he reports only that the next version of Android will include standardized support for IR blasters. Android manufacturers, including Samsung and HTC, have offered custom solutions in the past -- Google will standardize it.
If Google does move into the living room, it will be ahead of efforts from Apple and Microsoft. Apple has reportedly had a dedicated TV set in the works for years, while Microsoft's upcoming Xbox One is as much of a smart TV as it is a device for playing video games.
Android is now at the core of Google
During Google's last earnings call, CEO Larry Page explained that he used to feel guilty about spending time on Android. Years ago, Android was merely a side project, a long-term bet -- but that's no longer the case.
Now Android stands at the center of Google's activities, keeping its services relevant in the mobile world. When Google unveils KitKat, the changes it's made will have an immense impact on its business, along with businesses of its rivals, Apple and Microsoft.
Editor's Note: This version has been modified to reflect the existence of other smartphones priced less than $100.
Are you an Apple shareholder?
Apple has a history of cranking out revolutionary products... and then creatively destroying them with something better. Read about the future of Apple in the free report, "Apple Will Destroy Its Greatest Product." Can Apple really disrupt its own iPhones and iPads? Find out by clicking here.