Google Inc (GOOG) Android operating system has limits to usage

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Google Inc (NASDAQ:GOOG) has revealed some of the rules associated with using the Android operating system by OEMs. The restrictions that Google has on device makers is that Google apps must be featured and Google must be set as the default search. European antitrust authorities are reviewing the conditions to determine if Google is abusing the Android position.

Companies that have a dominant market share are required to promote competition in Europe. There are no requirements for this kind of thing in the U.S. so it would be difficult to show that Android’s stance is violating antitrust rules. Android is the leading operating system for mobile devices as it runs on 79% of smartphones and 62% of tablets that are shipped worldwide in 2013, according to Strategy Analytics. 

Google offers Android free to handset companies as a rival to the Apple iPhone. Since Google is the default search, more people are directed to Google.com. Google sells ads on Google.com. To get access to key apps on the Google Play Store, Android device companies like Samsung has to sign a “Mobile Application Distribution Agreement” with Google. The full terms of the agreements have not been disclosed. However, the documents were admitted as exhibits during a 2012 patent and copyright case between Google and Oracle.

Around a dozen Google applications must be preinstalled on the devices and Google Search / Google Play Store should appear “immediately adjacent” to the home screen. Other Google apps should not appear more than one screen swipe away as well.

Personally I don’t think that this is a big deal because other companies impose all sorts of limits about software that is used on their ecosystem. Twitter has rules for their APIs and Apple requires certain design elements from app developers for the App Store. Microsoft imposed flatter designs for the Windows Phone Store from apps submitted on their platform. Google is actually saving manufacturers a lot of money by offering their mobile operating system for free.

[Source: WSJ]

This article was written by Amit Chowdhry. You can follow me at @amitchowdhry or on Google+ at
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