Amidst the news yesterday that Google had finally received the necessary regulatory approval to close its acquisition deal with Motorola Mobility and the subsequent storm cloud of layoffs looming on the horizon, was the relatively innocuous story of how Google finally managed to convince Chinese antitrust officials to sign off on the deal.
As I mentioned briefly yesterday, before giving Google and Motorola its collective blessing, China had the search engine giant agree to a number of key stipulations, the most prominent being that Android remain free and open source for at least five (5) years. In order to uphold its end of the bargain, Google will have to submit biannual reports to China’s Commerce Department, with the assumption it will face stiff reprisal should it fail to comply.
But why is a free and open source Android important to China? While trying not to overstate things, it truly seems like Android is China’s kind of mobile operating system; a widely accessible and infinitely modifiable platform that seems to embody everything China hypothetically stands for.
Over the past several years I’ve often given Google a hard time for its Android strategy, a quantity over quality approach that is diametrically opposed to Apple’s single device method. My complaint has always been that Google floods the market with a myriad of devices running a modifiable platform, relinquishing any sort of quality control over the platform that ultimately results in a market filled hundreds of Android devices competing against each other, with few actually competing against Apple et al.
With that said, however, I can’t help but admit that Google has found its own successful marketing strategy, and nowhere else in the world is the success of Android more evident than in China. Following the latest Q4 results, Android accounted for 74 percent of all mobile devices beyond the Great Wall, meaning that China and its telecommunications sector have a vested interest in seeing Android, well, stay exactly the same.
It is exactly that concern, it seems, which spooked Chinese antitrust regulators in regards to the proposed deal between Google and Motorola, as questions were raised about the ramifications of Google entering the mobile market and the “the vertical integration of software and hardware” that would result from the joining of the two companies.
In order to preserve the mobile status quo, China offered its approval of the deal contingent on Google agreeing to several provisos. Not only will the search engine giant continue to keep Android free and open source (and really, why would it want to stop?), but it has also agreed to uphold the existing fair, reasonable and non-discriminatory (FRAND) rules governing Motorola Mobility (something that Motorola has already struggled with in Europe),.
Truth be told, the free and open source nature of Android may still eventually be its undoing—I still happen to think so—but I simply can’t argue that Google’s strategy both here and abroad its paying handsome dividends, earning Android the top spot among global operating systems. In fact, one might even wonder why China would have to put such stipulations in place to begin with, unless of course Chinese regulators knew something else about Google’s long term Android vision…but that’s for another time.