Google Inc (GOOGL)’s Intention Behind Launching Android One

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Google Inc (NASDAQ:GOOGL)’s Android is by far the most used mobile OS in the world. Research and surveys done by many different firms has shown that when it comes to smartphones, the ones based on Android outnumber all the other mobile OS combined.  Which makes one wonder what was Google’s intention behind launching an OS that brings down cost of a smartphone to as low as $100, because something like this is usually done by niche players to increase their market share. Well, we might never know Google Inc (NASDAQ:GOOGL)’s actual intention, but the post announcing launch of Android one on Android’s official blog surely explains the reasoning behind this product.

First of all, unlike other players, Google Inc (NASDAQ:GOOGL) launched Android as an open source mobile OS, which proves that it never had the intention of making money directly through the OS. As the post highlights, with Android One, Google Inc (NASDAQ:GOOGL) is trying to make the smartphone affordable for the ‘next 5 billion’ i.e. the people who currently can’t afford a smartphone. Right now the Android One based phones have been launched only in India, but they will soon be available in other countries across the World.

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One remarkable thing about the phones based on Android One are that they don’t  lack in functionalities or features, even though they come at less than half the price of an average ‘budget smartphone’. Google Inc (NASDAQ:GOOGL) has ensured through its partners that the Android One phones contain nearly all the features we associate with a smartphone, from front- and rear-facing cameras to downloadable mobile apps.

It is well known that Google gets most of its revenues from advertising and it generates so much in advertising revenues only because a vast majority of people across the world use its ecosystem, which constitutes of range of services like search, email, cloud storage and others. By launching Android One, Google Inc (NASDAQ:GOOGL) makes smartphones available to people who mostly don’t have access to internet. When they get their smartphone and use it to access internet, they will be doing so within Google’s ecosystem. Advertising is a business where everything depends on how many people you can reach, by launching Android One, Google Inc (NASDAQ:GOOGL) will surely increase its reach by leaps and bounds.

As of June 30, 2014, Ken Fisher‘s Fisher Asset Management owns over 700,000 shares in Google Inc (NASDAQ:GOOGL).

Disclosure: None

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