Google's Android One Launch Could Spark A Smartphone War

Google IO2014 AH 32

Google is getting ready to launch Android One in India. The company is holding an event on Sept 15 that will probably usher in Android One to the developing world. Android One phones are going to be cheap, between $115-165. We won’t see them in the US. That’s not Google’s goal with the program. Android One is going to take care of the hardware side of the “next billion users” initiative that started on the software side with Android KitKat. India and other developing countries are not saturated with smartphone users. Few consumers have smartphones, and when they do, they carry something from BlackBerry, Nokia, or a local OEM. Google is moving in with Android One to take that market share for Android.

Android One could usher in a smartphone war, one that won’t turn out well for Samsung and other big OEMs that are not prepared to kick out cheap smartphones with very, very thin margins. Samsung is already losing market share in India, China, and other developing nations. Xiaomi is a good example of a manufacturer that sells devices ultra-cheap. In fact, Xiaomi just sold out of the Redmi 1S in India in less than 5 seconds. They did that by pricing the device so low that consumers in India couldn’t pass up the deal. Neil Mawston is an analyst at Strategy Analytics, a UK-based analytics company. He puts it this way, “A major threat for Samsung is that Android One will accelerate the race to the bottom on smartphone pricing. Android One now makes Google a foe, not just a friend, for Samsung.”

The companies that have signed on for Android One hardware include Karbonn Mobiles, Spice Group, and Micromax Infomatics. New Android One smartphones should be rolling out this month. Competition is coming from other platforms too, like Mozilla’s Firefox phone. A price war would mean trouble for companies like Samsung. For Samsung, brand and marketing are everything. They’ll need to shift quickly if they want to take advantage of Android One and what Google is doing in India and other countries.