Rumors of the Google Phone's transformative powers are greatly exaggerated, I think. It's not that Google isn't capable of making an awesome piece of hardware. They might be. But Google is a paid advertising company -- ads account for 90 percent of its revenue -- and a free software company. Why does it need to build its own phone again?
Slate's Farhad Manjoo, who has a habit of hitting these things square on the head, makes some sense:
Reading this I thought about Microsoft. Microsoft is a software company too. A decade ago, Microsoft Windows dominated computer operating systems much like Google search dominates the search ad industry. But then something happened. Apple started catching up. The reason has something to do with Microsoft's inferior software (Vista was a certain bomb) but I think it also had to do with the inferior PC hardware that ran Windows. Apple computers just ran better, and Microsoft was partly doomed by the failure of actual PC computer hardware to keep up. Do you see where I'm going with this?
Maybe Google is building its own phone to avoid becoming the next Microsoft, doomed by the inferior hardware on which your software company depends. Google has always said that the next Google is probably something that hasn't been invented yet. What if it's a company that brilliantly merges online calling service for smart phones with mobile advertising that helps subsidize the cost of that online service, making it incredibly affordable for callers and incredibly lucrative for the company? What if they partner with a phone that's so evidently superior -- an iPhone with service, perhaps -- that they capture the up-market, and then the medium-market, just like Apple computers? I'm guessing it's that fear that animates Google to take hardware matters into their own hands.
