Is Google Making Money By Giving Android Away Free?


Not long ago we ran an article not long ago detailing how Google makes money with all of their offerings, and how those goods and services are translated to the Android platform, and how the Android platform adds value to their overall portfolio.

Recently we got to see just how well Google is doing — and how Android factors in to their bottom line.

During Q3 2010 Google posted solid results, beating Wall Street estimates, with reported revenues of $7.29 billion (23% higher than the $5.94 billion they reported in the same quarter last year).

During their third quarter earnings conference call Jonathan Rosenberg, Google’s senior vice president of product management said “The people who are accessing our products and services through their mobile phones are adding $1 billion to our revenue streams. Clearly, this is the future of search on the Internet.”

Android is a large part of their mobile strategy. Google’s CEO, Eric Schmidt reported that Android has grown “well past anything that (he) had ever hoped for.” He also noted that Android customers use mobile search twice as much as other smartphone customers.

Is Android meeting expectations? Android’s goal is “for Google to make money on search and value-added services on top of the operating system.” Although Schmidt didn’t give any long-term profit target for Android, he said it will be “very lucrative.”

Just how lucrative? In September, Gartner Research reported that Android will make up 17.7% of the smartphone market this year (just higher than BlackBerry’s 17.5%). By 2014 Android may hold 29.6% of the market — which would puts it in position to overtake Symbian, which currently holds 30.2% of the smartphone market.

And how do Google’s shareholders feel? Google is up almost 11% today.

Source: Fierce Wireless

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About The Author
Joe Levi
Joe graduated from Weber State University with two degrees in Information Systems and Technologies. He has carried mobile devices with him for more than a decade, including Apple's Newton, Microsoft's Handheld and Palm Sized PCs, and is Pocketnow's "Android Guy". By day you'll find Joe coding web pages, tweaking for SEO, and leveraging social media to spread the word. By night you'll probably find him writing technology and "prepping" articles, as well as shooting video. Read more about Joe Levi here.