Optical/IP Networks

Google Says Android's on a Tear

The Android operating system, while a consumer favorite, is not a key revenue driver yet for Google (Nasdaq: GOOG), but the search giant is counting on the OS to drive growth well into the future.

Speaking on the company's second-quarter earnings call Thursday, Google CEO Larry Page divided the company into three buckets:
  • Search and ads -- Google's key revenue drivers.
  • Android, YouTube Inc. and Chrome -- businesses with high consumer interest that Google is investing in for the long term.
  • Local, commerce and social -- new businesses Google is excited about.

"We don’t do things we don’t think will generate big returns over time," Page said on the call. (See Google Reports Q2 Gain.)

There is some overlap among the categories, as Page noted that the new social networking site, Google+, is quickly becoming a consumer favorite as well. Over 10 million people have joined the site in its first two weeks, he said, and these beta users have shared 1 billion items in just one day. (See Google + Mobile = Winning Combo.)

But the real momentum remains in mobility. Google is activating 550,000 Android devices per day, Page said, adding that that's a huge number even by Google standards. The Android App Market, which just got a refresh to improve usability, is also doing well, with 6 billion apps downloaded to date. (See Discoverability Trumps Search on Android and Google Goes Upwardly Mobile.)

Google Senior Vice President and CFO Patrick Pichette added that Google sees mobile being like search was in 2002: All the formats are new, and there's room for improvement. It's a mistake to say that whatever we have today is a good proxy for the future, he said. That's why Google is so excited about mobile.

Page dodged a question about Google's patent portfolio in light of its lawsuits with Oracle Corp. (Nasdaq: ORCL) that could threaten its mobile business. Instead, he noted that "Android is really on a tear." [Ed. note: Thanks, Larry. Big help there.]

Some more numbers to back him up, in addition to 550,000 daily activations: 130 Android devices available from 39 OEM partners, 231 carriers partners in 123 countries and more than 78 Open Handset Alliance members. (See OS Watch: Oracle Seeks Billions in Google Lawsuit.)

"We’re only at 1 percent of where we need to be," Page said. "Google’s just getting started, and that's why I’m here."

— Sarah Reedy, Senior Reporter, Light Reading Mobile

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