Google in Talks with Verizon, Sprint on Phone Software

Google is in advanced talks with Verizon Wireless to put its applications on Verizon phones, according to sources close to the negotiations. The Wall Street Journal reports that Google is also talking to Sprint Nextel. According to the Journal, Google should announce new software and services within two weeks, to be used by handset manufacturers to make "customized Google-powered phones." The Journal notes that such partnerships could allow handset companies to charge less for phones, since Google will likely charge below-standard licensing fees for its software and OS. Google would gain a wide audience for its platform, since Verizon and Sprint are the number 2 and number 3 carriers by subscriber in the U.S. The prospect of a Verizon-Google partnership is somewhat surprising in view of the companies' wrangling over FCC radio spectrum rules. Sprint, on the other hand, already has a working relationship with Google on software for the carrier's new high-speed WiMAX network. The research firm IDC forecasts that approximately 1 billion Web-enabled phones will be sold by 2011. "Many people in the next five to 10 years -- their first experience in the Internet will be through a mobile phone," Google CEO Eric Schmidt said in May. Google shares rose 2.3% to close at $694.77 Tuesday.

Sources: Wall Street Journal, Bloomberg, Reuters, Information Week
Commentary: Google to Announce Wireless Plans in Two Weeks...Maybe • Can Google Convince Wireless Carriers That It Is A Partner And Not A Foe? • Verizon Sues The FCC As Wireless Auction Showdown Looms • FCC Spectrum Rules Favor New Entrants Over Incumbents -- Source
Stocks to watch: GOOG, VZ, VOD, S, AAPL, T. ETFs: FPX, FDN, TTH, IXP, VOX
Earnings call transcript: Google Q3 2007, Verizon Q3 2007, Vodafone Group FY 2006, Sprint Nextel Q2 2007

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