The Wall Street Journal is reporting that Google is entertaining discussions with a variety of wireless carriers as it plans its gPhone launch in the next few weeks. Verizon appears to be heavily involved, but not exclusively. Google is talking with Sprint and T-mobile as well. Google is looking for a carrier partner(s) to help launch devices that will feature a mobile Google platform, or “operating system.”
The gPhone platform will include many Google derived applications including maps, calendar and messaging software. Most importantly, the gPhone will have a highly developed mobile advertising engine based on AdSense. Google sees the mobile phone as its next engine for growth. Verizon has multiple motivations for partnering with Google. Such a partnership could drive more data usage on mobile phones, which is the biggest driver of ARPU and profitability. Secondarily, a Google partnership will generate significant buzz – perhaps rivaling the iPhone buzz created by AT&T and Apple. Verizon may even be able to leverage a Google partnership to surpass AT&T and take the lead as the largest wireless provider in the U.S. Despite the enormous hype surrounding the iPhone launch, Verizon pretty much held its own, at least according to 3rd quarter numbers. Verizon added 1.6 million retail post paid subscribers to AT&T’s 1.2 million in the 3rd quarter 2007. A potential Google partnership could help push those net adds even higher and may help Verizon close the gap (or even surpass) with AT&T, which currently has a 65.7 million total subscriber lead to Verizon’s 63.7 million. Most analysts believe that a gPhone will be relatively inexpensive, especially when compared to an iPhone. It’s certainly not an “apples to apples” comparison, but Google may have enough cachet to make the gPhone wildly popular. If Verizon and Google find common agreement ground, we may see a tight race for the number one wireless provider crown.
