Google Phone Nearing Reality

It would appear that Sprint (S) and Verizon (VZ) are bidding for rights to the upcoming Gphone.

In the next two weeks, Google (GOOG) is expected to announce new software and services that handset makers could use to build customized Google-powered phones. In order to get its mobile devices in front of consumers by the middle of next year the company needs wireless operators to sign on relatively soon.

I have repeatedly said that Google would be more concerned with the reach of their product than the profit per piece and early indications are that may well come to bear. The Wall St. Journal reported Wednesday, “A Google technology partnership might let the carriers offer cheaper phones, because Google’s licensing fees for its software and operating system would likely be less than the industry standard. The phones also would be open to third-party application development, potentially spurring development of new features.”

There is some speculation that Google will “pick a carrier” like Apple (AAPL) did with its iPhone launch and AT&T (T). I doubt it. Google is about reach and openness and turning the operating system over to a sole provider accomplishes neither. Now, that does not mean that the initial announcement will be with one provider but it will not have the 5 year exclusive lockup the iPhone has. To do so would be counter to everything Google has stood for up until this point.

Sprint is the most likely first provider because they are already working with Google on software for devices that will run on its new high-speed WiMAX network. That and the fact that they are desperate for something to jump start consistently declining subscriber growth. They will be the most amenable to anything Google wants.

My guess is Google is attempting to make your cell phone a 100% customizable entity. Good. For too long cell phones have been held hostage by the makers of them and what they decide to let us do with them. Google will break this model.

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