2010-06-30 17:14

Stepping up its rivalry with Apple and Nokia, Google outlines plans to court developers and put its operating system on lower-priced phones in China and India

Google plans to push its Android mobile software in India and China, and is exploring ways for developers to make more money from applications, stepping up competition with Apple and Nokia.

To attract programmers to its Android operating system, Google may offer tools that help them sell subscriptions, virtual goods, and other items from within applications on mobile phones, Andy Rubin, vice-president of engineering at Google, says in an interview.

The company also aims to put its Android operating system on lower-priced phones made by Huawei Technologies and LG Electronics in parts of Asia and Europe, where it's taking on Nokia, the mobile market leader. "The down-market opportunity is about to happen," Rubin says. "It's actually quite a revolution."

Android is part of Google's strategy to get more of its software on mobile devices, creating new avenues to sell advertising-its main source of revenue. The total mobile-ad market will grow to $13.5 billion in 2013 from less than $1 billion last year, according to research firm Gartner (IT) in Stamford, Conn.

Google, based in the US, lags behind Apple in mobile apps, which are a growing platform for ads and help attract consumers to devices. Android users have about 65,000 apps available, less than a third of the more than 200,000 Apple programs.

Android's Growth Google is taking steps to accelerate Android's growth. Expanding in new markets such as Korea helped drive up the number of users who activated Android devices to 160,000 a day in June, from 100,000 in May, the company said. Sixty-nine percent of Android-based phones sold in the first quarter were in the US "We are definitely in the hockey stick," said Rubin, referring to Android's growth pattern. Gartner predicts that Android will leapfrog Apple's operating system, iOS, by 2012 to become the world's second-most-popular mobile operating system behind Nokia-supported Symbian.

Google also is increasing incentives for app developers. It's exploring ways for programmers to make more money from their software, such as by making it easier to accept payments within the apps or sell subscriptions, Rubin said. That provides a way for consumers to purchase new game levels, virtual weapons, and monthly subscriptions to digital magazines. Apple added similar features to the iPhone in 2009.

Android developers mainly make money from ads placed within their apps or from one-time fees. That makes it harder for them to earn as much as their Apple counterparts. Of the $4.4 billion that consumers will spend on app downloads this year, Apple's App Store will receive at least 77 percent of the revenue, according to Futuresource Consulting in Dunstable, England. Android Market will collect 9 percent. Natalie Harrison, a spokeswoman for the US-based Apple, didn't return a call seeking comment.