MS+Android=Rediculous? A thought experiment...

[a5cent]

Lately, there has been a lot of news revolving around MS' involvement with Android, causing many of us to shake our heads in disbelief. Not long ago, many of us were calling the Nokia Normandy fake, which is turning out to be real. Now we have reports saying that MS may attempt to bring Android apps over to WP, which sounds even more outrageous. In isolation, and individually, I find these steps quite ridiculous, but if pieced together to a larger and cohesive strategy, then I'm not so sure. What follows will sound crazy (possibly not just at first), but bear with me...

Preface:

I've spent a good three hours looking at AOSP. Much of it is factually dead. By that I mean nobody is expecting Google to update those bits again. Messaging is one example, where the newer and more powerful implementations have been moved out of AOSP and into the closed-source parts of Android (GSM). Google is expected to continue this trend, aggressively improving GSM and encouraging developers to prefer them over their AOSP equivalents. Why? Because Google's primary goal is to decrease the number of apps that are compatible with AOSP and increase the number of apps that run only on fully certified Android (AOSP+GSM). This is a fully justifiable protectionist play to keep their most important asset (the apps in the Android ecosystem) fully under their control. Anyone can open an app store for AOSP based apps (like Amazon has), but Google has legally ensured that they are the only company that can offer AOSP+GSM based apps.

I must assume that the companies who currently rely on AOSP aren't entirely pleased by this, because the parts of Android they rely on are really just Google's red headed stepchildren. Far worse is that the number of apps that run on their products is steadily decreasing, relative to the number of apps that run only on AOSP+GSM. For example, compared to Google Play, the Amazon app store is already rather outdated. That is of course just another benefit to Google, as they hope to eventually convert every AOSP company to an AOSP+GSM company.

Chapter 1... Embrace:

MS forks AOSP Android and hands it over to a newly created FHA (Free Handset Alliance), of which Microsoft, Amazon, and most (if not all) of the Chinese handset manufacturers are founding members. The FHA would continually lobby Samsung to also join in with Tizen. In 2016, when Nokia can legally jump back into the Smartphone business, it would join the FHA as well.

While MS' fork of AOSP must remain compatible with the branch maintained by Google, everything else is developed through a community effort, in which any and all can participate and contribute to, including individual developers and none FHA members. The core management, leadership and development teams operate from Finland (ex Nokia).

The only restriction for FHA handsets is that they may not include any of Google's services (think of the marketing tagline... "Spyware free Android"). Instead, FHA handsets would ship with the full complement of MS' services. MS offers these services to FHA members at no cost. MS does this not only as a means of promoting their own services over their competitors, but primarily as a means of replicating all the features Google moves out of AOSP and into GSM. The idea is that FHA handsets run not only AOSP apps, but AOSP+GSM apps as well, with zero modifications. Recompile the AOSP+GSM app in Visual Studio... publish to the FHA app store... finished.

This must all combine into a single ecosystem. The Nokia Normandy will run FHA apps. Amazon Kindle Fire will run FHA apps (meaning all FHA devices also get 1st class access to Amazon's content library).Windows and WP will also run FHA apps, but only the subset which is deemed compatible with WinPRT's security model. Apps that violate any of WP's security principles or otherwise require features deemed unsafe wouldn't be distributed through the Windows Store.

Why would any company join the FHA? Firstly, members would gain access to services typically only available to members licensing the full Google experience (AOSP+GSM), at no extra cost. Second, In contrast to Google, MS doesn't dictate what OEMs may and may not include on their devices. If Samsung wants to replace any one of MS services with their own, they are free to do so. Third, the FHM reduces OEM risk, as they are no longer at the mercy of a single OS supplier, giving them more leverage against both Google and MS. Finally, and most importantly, MS doesn't ask for IP licensing fees from FHA members. MS asks that only of those in the OHA.

Chapter 2... Extend

For companies using AOSP, I think FHA Android would be a no-brainer. For companies using AOSP+GSM, choosing FHA over AOSP+GSM would at least be a very interesting proposition.

Although some might view this as MS giving up on WP, it would actually be more about assimilating Android and its hardware base, essentially making it impossible for Google to control either. If enough OEMs decide that consumers see little difference between FHA and AOSP+GSM handsets, while improving profits, I could imagine quite a large wave of FHA devices replacing the AOSP+GSM devices currently on store shelves. If that ever translates into a majority of the Android market, then I suspect it's game over for AOSP+GSM.

Anyway, assuming FHA devices can at some point achieve market dominance, that is when MS can start playing the same game Google is playing with GSM today. MS can start incorporating new features available only on FHA devices and encourage developers to make use of them, deliberately fracturing the Android ecosystem. Over time, FHA Android would start looking ever more like WP. The differences between AOSP+GSM Android and FHM Android would continually grow, while the differences to WP would shrink.

Chapter 3... Exterminate

At some point, FHA Android can be slowly relegated to the low end, while offering WP as the natural path forward.

Why would MS want to get rid of FHA Android after proving itself so successful? For the same reasons Google is trying to deemphasize and get rid of AOSP now... a protectionist play...

Epilogue

This sounds a little too much like a Hollywood movie, but I don't see how Google could effectively counter such a move by MS.

It also comes with a lot of IF's, I know. I'm not saying this can work... I'm just thinking out loud and putting it out there for everyone's consideration. Obviously there are a lot of possible variations on this plan, and I'm definitely not saying this is best. It's crazy... but how crazy is it?

TL;DR;
How Obi Wan Gates and Satya Skywalker may plot to overthrow The Empire and free the galaxy from Android dominance.

 

[maclancer]

This is like Apple embracing Windows OS.... I don't think it will happen. I will need to see it to believe in.

 

[a5cent]

Re: MS+Android=Rediculous? A though experiment...

This is like Apple embracing Windows OS.... I don't think it will happen. I will need to see it to believe in.

Not even close... it would be akin to embracing Android the way count Dracula embraced Miss Mina Murray.

 

[tekhna]

Re: MS+Android=Rediculous? A though experiment...

Doesn't make sense. Microsoft makes a killing from each and every single Android phone sold. That's what people forget about. Microsoft is making bank from Android sales.

 

[tgp]

Re: MS+Android=Rediculous? A though experiment...

Doesn't make sense. Microsoft makes a killing from each and every single Android phone sold. That's what people forget about. Microsoft is making bank from Android sales.

I think it's only the Android phones that have SD cards due to patent(s) on FAT, but yes, the royalties from that somewhat compensate for the losses from WP.

 

[tekhna]

Re: MS+Android=Rediculous? A though experiment...

I think it's only the Android phones that have SD cards due to patent(s) on FAT, but yes, the royalties from that somewhat compensate for the losses from WP.

I don't know if it's about SD cards or not, but the 2 billion a year in Android royalties is disguising the fact that the XBox is just burning cash.
Microsoft is making $2bn a year on Android licensing - five times more than Windows Phone | ZDNet

 

[radmanvr]

Re: MS+Android=Rediculous? A though experiment...

Interesting read I guess. You should write a movie.

 

[a5cent]

Re: MS+Android=Rediculous? A though experiment...

Doesn't make sense. Microsoft makes a killing from each and every single Android phone sold. That's what people forget about.

No. I certainly haven't forgotten that. If MS' efforts in this market were only about money, then they would have dumped WP long ago, not to mention they would never have released the Xbox One. That is what truly wouldn't make sense.

MS' involvement in the mobile space is currently much more about influence and power than it is about making money. That is the only thing Google, Apple and Microsoft are all willing to spend billions on without expecting an immediate pay out in return. The money comes automatically after you've secured your position.

Finally, the money MS earns from Android is peanuts compared to what Apple and Google earn. Just their app stores alone earn both companies more than MS earns off of Android. If Microsoft can choose between profits from Android licensing and profits generated by owning a larger part of the smartphone market, for example through their own FHA app store, they would choose the later in a heartbeat (most importantly because the app store can generate continual revenue from every Android device out there, whereas MS receives an Android licensing fee but once per device sold).

 

[dkediger]

Re: MS+Android=Rediculous? A though experiment...

I really think a community effort is the only way a counter to Google Android (AOSP/GSM) could be successful. A lot of egos to set aside. I really would like to see an Amazon/Microsoft collaboration though - just this would be immensely awesome.

 

[snowmutt]

That was a combination of an interesting read and a best case scenario all rolled up into 1 neat post.

I have to admit I have learned a ton more about Android then I ever thought I would or surely have ever needed. What I like about your post is it covers the single most important aspect to MS: Getting their products out into users hands. Using MS services is the drive of this company, sort of like advertising dollars is Google's single minded company goal. By attaching MS services to this, you show you do understand Microsoft. They are the ultimate "1 step backwards, 2 steps ahead" type company. One of the few left.

 

[a5cent]

That was a combination of an interesting read and a best case scenario all rolled up into 1 neat post.

Glad you enjoyed it. I wish more did ;-)

I suspect few are interested in hearing justifications for intertwining Android and WP. Most hate the idea, and I completely understand why. Parts of me feel similarly.

One of my goals was to show how "embracing" Android could be interpreted in different ways. If MS does nothing more than what BB did, then I would view it as a step towards WP's eventual demise. Combined with other measures however, it represents the tech industry's equivalent of a war cry, rather than waving the white flag.

 

[tgp]

Glad you enjoyed it. I wish more did ;-)

I enjoyed it! I learned a lot from your post.

Microsoft does well in enterprise and services. Why not completely drop WP as we know it, and go all in with services on the current mobile market leaders? Isn't WP the means to an end for Microsoft? WP is there, at least partially, to get Microsoft's services out there. However, so far it's been a lot of energy & money with little result. At this point WP doesn't offer any real advantages over the others, personal preferences aside. I would think that if Microsoft would put 100% of their mobile focus on optimizing their services on iOS & Android, they could provide the best services on mobile without question. In fact, some Microsoft services already work better on iOS & Android than on WP.

 

[a5cent]

I enjoyed it! I learned a lot from your postWP.

Happy to hear!

Microsoft does well in enterprise and services. Why not completely drop WP as we know it, and go all in with services on the current mobile market leaders? Isn't WP the means to an end for Microsoft? WP is there, at least partially, to get Microsoft's services out there.

Actually, I see this exactly the other way around (I hope this doesn't cost me all credibility with Snowmutt)

I actually tend to think that most of MS' services are also just a means to an end, at least currently. Most of their services can't contribute to MS' bottom line. They are of no help in paying the salaries for MS' employees. Many of those services are probably not expected to ever earn a dime, meaning they significantly lower MS' cost effectiveness. AFAIK, Office 365 is the only consumer accessible service that is profitable.

Certainly some services have potential, like Maps, Bing, and particularly Skype. But how large that potential is... I don't know. For Bing and Maps, the train may already have left the station.

Anyway, I don't think it's stated in MS' mission statement, that they want all their services running on all of their competitors operating systems and devices. While we love MS for being the only large software company to provide their services on every platform, it's not out of the goodness of their hearts that they do so. It's shear necessity. You can't buy Skype for a couple billion dollars, and then let it become irrelevant by offering it to only 4% of the mobile market (WP users). Competitors won't miss an opportunity to grab market share, if you provide an opening like that.

Basically, I don't see what MS has to gain, simply by being the provider of some of the most popular services on iOS and Android. Where exactly is the profit potential in that? To me, that sounds like a good way of going bankrupt. The only way to earn real money in the IT business is by owning the platform. That is what MS' involvement in the mobile market is about.

Google charges their OEMs a licensing fee for their apps, which as OHA members, they are legally forced to buy (Android is not free). Google takes a 30% cut of every app sale, netting them billions in profit for very little effort. Google uses their platform to distribute adds, netting them more money, all the while having every Android device act as a little data gathering machine, increasing the value their advertising channels even further. Only by owning the platform, can Google get this all to work together. Setting up such a system is completely impossible otherwise.

Want to integrate your services directly into the OS? You need to own the platform. Want to create an ecosysetm where the whole is greater then the sum of its parts? You need to own the platform. On the other hand, if you don't control the platform, you're basically at the mercy of your competitors. You must rely on them to play fair, and when push comes to shove, they rarely do. Google or Apple are both free to reject MS' apps. Nobody can force them to push an app to their stores that they disapprove of. While MS could certainly take such a case to court, it's easy to tangle that up for three or four years, by which time it doesn't really matter what the court decides.

IMHO it's not about the services. While they certainly are of strategic importance, they all serve a higher cause, which is supporting the platform. At least that is my take...

 

[ronty]

This is a seriously fantastic concept & should be adopted by Microsoft.

 

[a5cent]

I almost forgot... for all of those who don't like this idea because they don't want Android apps anywhere near their WP and Windows devices, that aspect could be completely omitted without changing the overall affect.

If MS' efforts with WP don't start paying off soon, I think MS should consider something along these lines either way, with or without Android app compatibility.

 

[rodan01]

I agree with the OP. But the plan is not crazy, obviously in MS are thinking about this possibility and "Normandy" is a first step in that direction.

OHA members aren't allowed to sell phones with an incompatible version of Android (FHA), so they have to chose one, this makes things harder but not impossible.
Of course Microsoft has to improve their services outside the US and be really generous sharing the revenue with the OEMs. At the end this would be a battle of the profitability of the services and how much each company can share with OEMs.

In this moment Google is much more profitable with services because they have the scale, in the other hand Microsoft can share all the profits with OEMs because consumer services are just a minor business for them. If the adoption of the Windows platform or FHA increase, the MS services become more profitable and Microsoft can share more with OEMs. Google would react sharing their own revenue to keep the OEMs on the OHA, but for Google services are the only stream of resources. So as the adoption of MS services increase Google dies.