At the moment you buy an Android phone, like a Samsung Galaxy S5, Google doesn’t make a penny. The Android operating system is free to other companies. Google just wants you to use Gmail, and its search engine and look at ads.
“They get paid by those brand advertisers," says Brian Blau, research director in consumer technologies at Gartner. "That’s really how they make money from Android.”
Giving it away got Android on lots and lots of devices—it now dominates the smartphone market. But lately some of those phone manufacturers haven’t been playing along with Google’s plan.
“Samsung has a lot of apps that would compete directly with some of the apps from Google itself,” Blau says.
Companies like HTC and Samsung give Android extreme makeovers: their own look, feel, even services that take a bite out of Google revenue. Amazon’s Android-based devices, like the Kindle Fire, cut Google out completely.
This, obviously, is bad for Google.
“Without being able to monetize it, it makes it slightly pointless,” says Nick Spencer, senior practice director at ABI Research. He says Google has lost control of Android. Fourth quarter last year, he says, 50 million Android devices shipped that have no benefit to Google.
This is why reports say Google is working on a program called Android Silver: new phones that meet its standards for design and interface, and services. They would get priority for new features and, Google hopes, put an end to all the fragmentation.
Spencer says this could force many manufacturers to toe the Google line.
“Certainly, the weaker brands, through competitive pressure, will have to adopt Android Silver,” he says.
One day, though, this could drive powerful manufacturers like Samsung to adopt their own operating systems that they can control.