Android Is Even Bigger Than You Think

I want whatever it is my Foolish colleague Hunter Pavela is eating nowadays. Here's what he wrote three weeks ago:

With Android 2.0 devices coming to market, Google will soon be partaking in that windfall. By limiting its killer product to AT&T, Apple (Nasdaq: AAPL  ) allowed an opening for the competition -- an opening that Google seems well-prepared to exploit. I'd say that's a threat.

I would, too, especially after having seen new numbers from Google's (Nasdaq: GOOG  ) recently acquired AdMob unit. Android had 20% of U.S. smartphone traffic during October, according its report.

But Android may be an even bigger threat to Research In Motion (Nasdaq: RIMM  ) and Palm (Nasdaq: PALM  ) . Here's a look at the month-over-month numbers:

Operating System

September 09

October 09

Difference (+/-)

iPhone OS

48%

55%

+7

Android

17%

20%

+3

RIM OS

14%

12%

-2

Palm webOS

10%

5%

-5

Windows Mobile

5%

4%

-1

Source: AdMob. Figures are for U.S. traffic share.

Impressive, eh? This is beginning to look like a two-horse race -- the iPhone's Coke to Android's Pepsi, at least here in the States. Nokia's (NYSE: NOK  ) Symbian is still a serious player worldwide. We should also concede that Motorola's (NYSE: MOT  ) high-profile rollout of the Droid smartphone has probably given Android a boost in the ratings.

Even so, Microsoft's (Nasdaq: MSFT  ) Windows Mobile continues to suffer fading influence here and abroad. The OS accounted for just 3% of smartphone requests worldwide during both September and October.

So Hunter had it right; Google's robot army is on the march. And while Apple may be the ultimate target, for now it's the lesser combatants that are sustaining all the collateral damage.

But that's my take. Now it's your turn to weigh in. How big a threat is Android to the iPhone and the rest of the smartphone industry? Please vote in the poll below. You can also sound off using the comments box at the bottom.

Apple is a Motley Fool Stock Advisor selection. Nokia and Microsoft are Motley Fool Inside Value picks. Motley Fool Options has recommended a diagonal call on Microsoft. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy wonders what it would be like to live in a van down by the river.


Read/Post Comments (20) | Recommend This Article (16)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 23, 2009, at 3:33 PM, accelerando wrote:

    The problem for google is that it doesn't really make money from android -- it make money from search. And its search business has zero future.

    Ai based web crawlers are no match for cagey website developers. Google search returns less and less useful info, more and more garbage and there is nothing they can do about it.

    Targeted apps for mobile phones will eliminate the need for search engines. Much, much quicker than most folks think.

    Imagine looking for a restaurant in a new town -- imagine the useless garbage google or yahoo or bing or any search engine will give you. Then imagine how quick and easy this search is from any of twenty apps from your mobile. End of story -- nighty, night google. <yikes, I just talked myself into selling my last remaining shares!!>

  • Report this Comment On November 23, 2009, at 4:06 PM, daveshouston wrote:

    Google gives away Android for free. They make their money from ad revenues when users run Google Apps. So they should benefit just as much when Google apps run on an iPhone as on a Droid or other Android phone.

    Android is mainly a threat to Windows Mobile because that's where Android is scoring. It's long-time Windows Mobile customers like Motorola and HTC who are switching to Android.

    Android is developing into a fragmented market for software applications. Each Android model has custom features so software apps won't just run on every Android model. For example, one Android phone has a physical keyboard and another a touchscreen keyboard. If the app was written to expect a physical keyboard it won't work on the other model. Apple doesn't have this problem.

    Android phones are being sold to unknowledgeable consumers by Verizon and T-Mobile sales people who are claiming it's "just like an iPhone." Most consumers don't realize that App availability should be their the most important consideration when choosing a smart phone. It's Apps that enable you to customize your phone and make it do whatever you want.

  • Report this Comment On November 23, 2009, at 5:02 PM, Gauss77 wrote:

    Daveshouston doesn't seem to be knowledgeable about android apps. I use various android platforms, with and without physical keyboards as part of my job. I've yet to run into an app that relied on something

    Google fairly thoughtfully designed the SDK to eliminate such problems. The only real issue is new features in new releases of the OS, which exists in every platform, even your precious iphone.

  • Report this Comment On November 23, 2009, at 5:17 PM, ReadEmAnWeep wrote:

    I don't think accelerando knows/understands google's business model.

  • Report this Comment On November 23, 2009, at 5:29 PM, BR14 wrote:

    "Android being a superior robust platform"

    Contrary to most ill informed commentators, RIM's OS is the most advanced and secure out there. And thats according to independent auditors. The UI is a different question, but we're talking robust.

    RIM also has carrier based infrastructure that allows data to be compressed securely to the handheld from within your enterprise and means carriers can generally handle 10 times the content of other smartphones for the same cost (but charged at the same rates to the consumer).

    Android doesn't even come close. Cool phones though and definitely catching up to iPhone in the consumer market and among Linux geeks (though have you seen Nokia's Maemo? V.Nice)

  • Report this Comment On November 23, 2009, at 7:52 PM, VegasMartin wrote:

    I'm a big believer in the Droid. But what the hell is going on with MOT? The stock has beaten down when I thought it was going to hold onto $9.

    http://www.ShootTheBears.com

  • Report this Comment On November 23, 2009, at 7:53 PM, VegasMartin wrote:

    I'm a big believer in the Droid. But what the hell is going on with MOT? The stock has been beaten down to $8.20. I thought it was going to hold onto $9.00. Only up 2 cents on a day the Dow rallies 130 points? Something isn't adding up.

    http://www.ShootTheBears.com

  • Report this Comment On November 23, 2009, at 8:54 PM, xmmj wrote:

    If you really want to compare Android with iPhone OS, I think you need to read thoroughlythe following article from Apple Insider (link below):

    "Inside Google's Android and Apple's iPhone OS as core platforms"

    While I have heard criticism of it being biased, no specific data was noted as being wrong. So until I hear specific arguments against it, I have to say that it lays out a very convincing explanation for why Android is seriously flawed. The most damning points (IMHO) are

    1- hardware fragmentation

    2- severe limitations of the RAM memory space available for apps

    3- lack of any quality control/security over the apps.

    4- Google's motivation behind Android is to stop MS from invading its advert revenue stream - and it has no real commitment to the platform.

    If the points in the article are true, then the very real flaws of Android will at some point become apparent, and the platform will flounder. If that should happen, then Apple will most likely pick up the pieces.

    http://www.appleinsider.com/articles/09/11/05/inside_googles...

  • Report this Comment On November 23, 2009, at 8:59 PM, xmmj wrote:

    If you really want to compare Android with iPhone OS, I think you need to read thoroughlythe following article from Apple Insider (link below):

    "Inside Google's Android and Apple's iPhone OS as core platforms"

    While I have heard criticism of it being biased, no specific data was noted as being wrong. So until I hear specific arguments against it, I have to say that it lays out a very convincing explanation for why Android is seriously flawed. The most damning points (IMHO) are

    1- hardware fragmentation

    2- severe limitations of the RAM memory space available for apps

    3- lack of any quality control/security over the apps.

    4- Google's motivation behind Android is to stop MS from invading its advert revenue stream - and it has no real commitment to the platform.

    If the points in the article are true, then the very real flaws of Android will at some point become apparent, and the platform will flounder. If that should happen, then Apple will most likely pick up the pieces.

    http://www.appleinsider.com/articles/09/11/05/inside_googles...

  • Report this Comment On November 23, 2009, at 9:03 PM, buynholdisdead wrote:

    I cant understand why anyone would write off Rimm.They are putting 300 million more into R and D from last year. Maybe I am missing something but they have no short term debt and I am thinking they are going to come out with something that is going to keep them in the hunt. One thing I have to say about Apple. At least they didnt make the Iphone propietary like they did the Mac and a co worker was showing the iphone to me and bragging about his gps. The only thing was the gps was run by Google Maps, lol.

  • Report this Comment On November 23, 2009, at 11:00 PM, buynholdisdead wrote:

    That makes sense "Info" but who is to say Rimm is going to keep the same os. Unix and Linux are open systems anyone can build their os using it. I think this maybe more interesting than anyone can say. I just cant believe Rimm would let their company fail over an os. I am betting on a turnaround. But willing to run for the hills if it doesnt happen.

  • Report this Comment On November 24, 2009, at 3:19 AM, buynholdisdead wrote:

    Dang where is the delete button.

  • Report this Comment On November 24, 2009, at 9:24 AM, jengelsma wrote:

    Droid is indeed helping the Android numbers. Check out this data from AdMob:

    http://www.androidcentral.com/admob-report-shows-android-gro...

  • Report this Comment On November 24, 2009, at 6:00 PM, timjones17 wrote:

    One of the reasons why Windows is on 90% of desktops is that it runs on many kinds of machines- from UMPC's and netbooks, to tricked out gaming monsters. Android runs on many kinds of mobile devices made by different manufacturers, and that will help it overtake Symbian as the most popular smartphone OS.

  • Report this Comment On November 26, 2009, at 4:16 AM, jakerome wrote:

    Really? You've accepted the AdMob report as gospel, despite all the disclaimers that Admob themselves put on the report? That's just awful. A good writer would conduct some independent research & analysis, and figure out that some platforms skew higher because it includes ads serving within applications. A really good writer would go further, and try to figure out why Palm usage spiked in September; maybe you'd learn that they had a bug in the code, who knows?

    But then again, this is the Motley Fool, and I don't expect to find good writers here.

  • Report this Comment On November 26, 2009, at 11:18 AM, TMFMileHigh wrote:

    Hello jakerome,

    Thanks for the comment.

    >>You've accepted the AdMob report as gospel, despite all the disclaimers that Admob themselves put on the report? That's just awful.

    Of course not, and ... really? Sorry, but this strikes me as a bogus complaint. If you have a beef with the AdMob report, then you have a beef with the entire history of AdMob's reporting since the methodology hasn't changed.

    Let's be clear on what AdMob is and what it measures. AdMob is the world's largest mobile ad market, and is now owned by Google. As such, it measures requests served by applications that exist on smartphones -- in other words, the traffic that matters most to marketers, advertisers, and software developers.

    Let's also remember that we're seeing these numbers as Android and iPhone OS continue to attract substantial interest from coders:

    http://www.fool.com/investing/high-growth/2009/11/25/how-and...

    Palm's numbers will undoubtedly improve as webOS's applications library grows.

    Foolish best wishes for a Happy Thanksgiving,

    Tim (TMFMileHigh and @milehighfool on Twitter)

  • Report this Comment On November 26, 2009, at 12:13 PM, jakerome wrote:

    I do have a beef with their entire history. Admob's metric measure only one thing-- how well are they selling ads. Look at the spike WebOS/Palm had in September. Do you think that was a real phenomenon? I doubt it-- I would bet that they had miscoded their in-application support for WebOS, and they were serving ads 24/7 to background apps, thus skewing the numbers. Now, I don't know that for sure, but it's the kind of question I would expect a reporter to ask when he says ad share fall 50% in one month for a mobile platform that is gaining share daily.

    Did you know that AdMob serves ads within application on the iPhone, Android and WebOS but not Blackberry, Symbian or WinMo? Guess what that means-- the numbers will be skewed to favor those platforms.

    AdMob puts out a press release about their business is doing, and too many financial sites report this as if it's some broad measure of usage. Why not check out statcounter's numbers, which measure browser visits equally on all platforms?

    http://gs.statcounter.com/#mobile_os-ww-weekly-200922-200948

    Lots of great data there. Since the point of the report isn't to promote their ad business, they don't put out slanted press releases each month, so you have to dig a little deeper for the data.

  • Report this Comment On November 26, 2009, at 12:13 PM, jakerome wrote:

    I do have a beef with their entire history. Admob's metric measure only one thing-- how well are they selling ads. Look at the spike WebOS/Palm had in September. Do you think that was a real phenomenon? I doubt it-- I would bet that they had miscoded their in-application support for WebOS, and they were serving ads 24/7 to background apps, thus skewing the numbers. Now, I don't know that for sure, but it's the kind of question I would expect a reporter to ask when he says ad share fall 50% in one month for a mobile platform that is gaining share daily.

    Did you know that AdMob serves ads within application on the iPhone, Android and WebOS but not Blackberry, Symbian or WinMo? Guess what that means-- the numbers will be skewed to favor those platforms.

    AdMob puts out a press release about their business is doing, and too many financial sites report this as if it's some broad measure of usage. Why not check out statcounter's numbers, which measure browser visits equally on all platforms?

    http://gs.statcounter.com/#mobile_os-ww-weekly-200922-200948

    Lots of great data there. Since the point of the report isn't to promote their ad business, they don't put out slanted press releases each month, so you have to dig a little deeper for the data.

  • Report this Comment On November 26, 2009, at 4:15 PM, jakerome wrote:

    Actually, StatsCounter seems to show that Symbian is still #1, with the iPhone a strong second and RIM leading the rest in 3rd.

    So there are doubts.

  • Report this Comment On November 26, 2009, at 4:25 PM, topsecret09 wrote:

    Mororola has re-Invented themseves before. Anybody underestimating this company and their droid, will miss out on a nice profit In the next couple of years. I green thumbed them at 5 bucks at 1 star, now at 2 stars? I hope the talking heads at the street.com keep dissing them. I will just keep buying It under 9 bucks. http://caps.fool.com/Blogs/ViewPost.aspx?bpid=278916&t=0...

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