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Sep
28

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Alphabet Inc. Google (GOOG) sent out invites today for the launch of “made by Google” hardware in San Francisco on October 4. Online speculation points to the release of a new Android smartphone. The company has neither denied nor confirmed the rumors. However, the madebygoogle.com site, which shows its search bar morphing into a phone, is enough proof that a new phone might be in the works.

The new phone will come in two editions – Pixel and PixelX – and feature 5-inch and 5.5-inch displays. They are rumored to be manufactured by HTC and will run Android Nougat, the latest version of Android. More importantly, Google will compete head on with Apple Inc.’s (AAPL) latest iPhone 7 by announcing an upgraded processor and camera. Both are new features touted by Apple at its launch event two weeks ago. (See also: Google’s New Phone Adds Upgraded Camera, Processor)

As I explained in an earlier post, Google’s hardware has never made a substantial difference to its bottom line. Instead, the phones serve to “showcase” the best of the Android experience. That experience is fragmented across multiple Original Equipment Manufacturers or OEMs, which have customized the company’s free mobile operating systems for their own ends. This is the reason why, despite the best-selling mobile operating system in the world, Google does not earn much revenue from it. (See also: The Business Of Google).

Source: SpecOut | Graphiq

However, Google is moving to assert its control over the Android experience. This is why Google’s rebranding of its phones is interesting. This past summer Google CEO Sundar Pichai said the company would be “more opinionated about the design of phones.” That statement can be construed in two ways. As this article points out, it could be Google’s attempt to “nudge” manufacturers in a certain direction that is consistent with its own vision of the Android experience.

Or, it could be the company’s efforts to stay in line with future technology trends, such as artificial intelligence and the Internet of Things. Mobile applications on the company’s Android ecosystem that highlight its capabilities with these trends will align with the company’s vision and, also, open doors to more revenues down the road from Android. For example, according to reports, Google is planning to re-enter the Chinese market with a local version of the Play store. That version will feature Android wear for smartwatches. China has already turned out to be a big market. It could also help Google’s bottom line.

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