The launch this week of the first mobile phone using Google's (Nasdaq: GOOG) Android open source platform will stimulate a community of applications developers and could be adopted in emerging markets including Latin America as a slightly cheaper version of the iPhone, Tuong Nguyen, principal research analyst for consultancy Gartner, told BNamericas.
The G1 handset manufactured by HTC for T-Mobile's US operations, which includes SunCom in the Dominican Republic is seen by analysts as the second major development in the mobile handset sector this year after the launch of the 3G iPhone.
The handset itself has received mixed reviews with some critics saying the handset is not as a sexy as the iPhone.
However, the fact that it is the first product to emerge from the Open Handset Alliance - a partnership of more than 30 equipment suppliers and operators, spearheaded by Google - means the launch is significant as it represents the direction the handset industry is going.
"In terms of the industry I think this speaks more about where the mobile phone market is going. You have another open platform for people to develop upon," Nguyen said.
And the G1 is just the first of many Android-based phones, according to Nguyen. Samsung and LG have talked about releasing similar phones in the first half of next year, meaning that prices will come down and make such handsets more accessible to markets such as Latin America.
OPEN SOURCE COMMUNITY
Another result, according to the analyst, is that the phone will create a community of applications developers, which could help to focus the appeal of the phone according to regional characteristics.
"You could look at it the same way you look at Linux on the PC. It doesn't end up dominating the market but it opens up the market to ideas and innovation... strange, wacky ideas that get people to make applications and raise consumer awareness," Nguyen said.
The governments of Brazil and Venezuela are both implementing state driven programs to have widespread adoption of Linux software at least in public bodies and have already achieved a certain critical mass of developers.
There is also competition from other mobile phone manufacturers producing phones over open source platforms, namely Nokia, with its Symbian platform.
Nokia has an approximately 40% market share of the global handset market, and Symbian platforms are expected to account for 60% of the open source mobile telephony platforms at the end of 2008 and hold steady for the foreseeable future, according to Gartner.
Linux-based platforms are expected to grow from the high single digits in 2007 to the low double digits in 2012, Nguyen said.
THE NEW iPHONE
While a specific impact of the handset on Latin America is still early to predict, there are certain elements that can be considered.
The iPhone created a big splash worldwide when it came out in July and is expected to generate more awareness of the functionalities of smartphones.
However, with the phones being sold in Latin America for an average of US$300 and tied to binding postpaid contracts, adoption is likely to be limited to the higher-end segments.
The G1 - which comes out in US stores on October 22 - will cost US$179 with a two-year contract, slightly cheaper than the US$199 price for the iPhone in the US.
According to Nguyen, the G1 could be perceived as a cheaper, though just as cool, version of the iPhone. Other vendors besides HTC will provide phones using the Google Android platform. With competition, prices will come down, meaning more consumers can afford phones with iPhone type touch and feel and applications.
"So you won't have to be the guy waiting in line for five hours. You'll see scale ramp up a lot faster. You won't have to be the guy without an iPhone as you can have the same features on the Google Android phone," Nguyen said.
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