2015 is certainly playing out to be a year of mobile disruption, most recently with rumors of Google Mobile Virtual Network Operator (MVNO) deals with Sprint and T-Mobile,–two rather disruptive mobile operators themselves. Google has yet to announce anything, but as a follower of Google’s “invisible hands,” I’ve been pondering just what Google might be up to by crossing wireless industry stovepipes yet again (i.e. – Motorola acquisition and disposition).
I seriously doubt Google plans on taking over the mobile services market as articles in the business press would have us believe. Rather, they are most likely aiming to accelerate mobile evolution; and there are certainly a few things that could use fixing in the mobile ecosystem.
Let’s review Google’s core philosophy, the “Ten things Google knows to be true” (linkhttps://www.google.com/intl/en/about/company/philosophy/). Please pay particular attention to the items that are highlighted and commented on to explore why Google could announce a MVNO.
Google’s Public Philosophy:
1. Focus on the user and all else will follow.
People love slab-based smartphones and all they can do, but more people love Apple iPhones than Google Android-based phones. During 4Q-2014, 69% of Tangoe’s North America customers ordered iPhones, 10% ordered Android, continuing an enterprise share shift we’ve been seeing over the past two years. And Apple has its enterprise IBM alliance positioned to further bolster enterprise share with vertical industry apps.
Google needs to do more to win back share for Android, so why not focus on mobile user pet-peeves?
Perhaps fixing lousy voice calling quality with seamless Voice over LTE and Voice over WiFi calling? Converging clunky TDM-based mobile voice to VoIP could lessen the bill of materials and cost of slab smartphones, and Google has the VoIP chops with its Google Voice service and massive cloud infrastructure to do it. Google Hangouts supports IM and video chat over IP, so they could take on Microsoft’s Skype, but for widespread mobile adoption, faster, more abundant and less expensive mobile data is needed.
Fear of mobile data cap overages is a problem that could be addressed with a public WiFi first device, such as Republic Wireless’ Motorola Android phones with their “Smart Coverage =WiFi+Cell plans” or elements of Comcast’s new “Freewheel” public WiFi service + device.
A BYOD trend driver, employees could stop carrying around both a work and personal device, replacing it with a “dual-persona” smartphone with dual SIM cards with separate personal and work containers or virtualized instances, which would be a superior solution to current BYOD arrangements.
All these functional improvements are on mobile industry long term roadmaps, but a Google MVNO could help accelerate innovation. However Google needs to act now if Android isn’t going to follow in the footsteps of other failed mobile OSs. In a Form vs. Function contest, Apple is winning in form.
2. It’s best to do one thing really, really well.
That would be free search and paid advertising for Google, and being able being to search anywhere for anything is where mobile comes into play. Google recently sold its Motorola handset division to Lenovo (and shut down its Mountain View California public WiFi network, but is still inching forward with Google Fiber). It is unlikely Google would become a long term player as a mobile operator, but exiting from Android in the Mobile OS space would open a large door for Apple to enter search and advertising. Thus Google should remain committed to the Android OS.
3. Fast is better than slow.
And WiFi is faster than LTE. But WiFi has a small propagation range compared to mobile, which also does cell handoffs making for practically unlimited range. But the two wireless technologies can better complement each other for a faster mobile user experience. Public WiFi capabilities are improving thanks to collaborative efforts between the WiFi Alliance, the Wireless Broadband Alliance, and Cable TV provider public WiFi roll-outs. Perhaps Google’s rumored MVNO is waiting to add a public WiFi consortium of cable operators before it is ready to announce?
4. Democracy on the web works.
But perhaps not for unmanaged WiFi networks, as Google learned in Mountain View, but we won’t focus on this faux pas.
5. You don’t need to be at your desk to need an answer.
Anywhere access is what compels Google to play in mobility. It is what drove Google to develop Android and why it must cut across mobile industry verticals, at least as an agent of change to advance and protect its core ad business.
6. You can make money without doing evil.
Google gets high marks for its efforts to bring the world online and be freely searchable. Unlike the NSA, Google has thus far been able to keep our ad-oriented rich private profile data secure. Google also seems to advocate for competitive markets so is unlikely to be out to eliminate major mobile carriers, who are its partners, by launching an MVNO, but rather to learn from the inside out and use its talents to accelerate mobile innovation. Rather proprietary Apple and Microsoft are more appropriate competitive advisories for Google.
7. There’s always more information out there.
Google has a voracious appetite for collecting data, and mobile oriented data could be Google’s next frontier. From billing records to calling patterns correlated to locations, Google could provide even more targeted advertising, the golden goose of the ad industry. And if it can monetize that data, it certainly will.
8. The need for information crosses all borders.
And so does mobile.
9. You can be serious without a suit.
Instilling Silicon Valley culture just might re-instill long term thinking into the wireless coverage myopic and quarterly dividend driven mobile services industry.
10. Great just isn’t good enough.
Android is great, but Apple iPhone with iOS is better, at least according to market share trends. In the three-way mobile contest between Apple, Google and Microsoft, Apple is gaining a commanding lead over Google with its consumer design priorities. But Google’s acceleration of mobile innovation could drive lower handset and data costs, making Apple’s lofty mobile device profits unsustainable. Alas, stove-piped Microsoft is a distant 3rd, with its mobile intentions subject to ambiguous interpretation.
In summary, if Google does announce a MVNO as expected, my top picks on what it could accelerate:
- Public WiFi + Cellular for improved aggregate data speeds at lower cost (and more mobile ad clicks).
- HD voice over IP, SMS over IP and mobile video chat over data-only mobile service (lower cost drives more usage and ad clicks).
- Reference designs for dual-persona phones with two SIM cards and numbers to separate business and personal use. (despite fewer smartphones sold)
- Less expensive Android slab phones with a bill of materials more similar to tablets.
- Massive scaling of Google Voice’s VoIP infrastructure on Google’s cloud via SDN & NFV to drive down mobile core costs.
- Improved consumer mobile advertising capabilities.
- A competitive response from Apple.
But don’t expect to see all this in a Google MVNO announcement!
*John Mazur does not own shares of companies mentioned in this blog.