Google's Android: The Benefits of Synergy

| About: Alphabet Inc. (GOOG)

In recent years, well meaning people, politicians and environmentalist, have pushed antagonistic policies. Policies that result in 1 + 1 = 1.5. On the other hand, Google (NASDAQ:GOOG) is making a big 1 + 1 = 3 push. Google appreciates the benefits of synergy.

The Google Android development kit has been downloaded in record numbers. The kit is free and the software will be distributed free. This means the new Android based phones, coming to market in a few weeks, will sell for less than Apple (NASDAQ:AAPL) iPhones which are sold with built-in software license fees. Google has also made its Google Apps software open and free. This software includes all sorts of free services including email, instant messaging, photo albums, and office productivity programs such as spread sheets, word processing and presentation programs.

The free package is certainly a lot more than free web pages and email with 6 gigabytes of free storage, but 6 gigabytes of free web space and off site, backed up, storage is nothing to sneeze at. Enterprises, everything from schools, to businesses, to churches, should consider getting rid of in-house servers and using the free hosting provided by Google. The savings are substantial. The Google deal this week that will connect Google Talk with the Yahoo (NASDAQ:YHOO) Instant Messaging program will dramatically expand the usefulness of yet another free service.

On another front, it appears that the market is going to move toward free wireless Internet connections and free basic service but metered cost for heavy users. It is becoming clear that those who constantly consume huge quantities of bandwidth in activities such as transmitting videos, should pay a higher price than someone who surfs the net a little and sends a few emails. Google is an advocate of totally free basic connections.

The Mobility Factor

The big leap forward is the mobility of a slew of free services. The cell phone company practice of finding the way to sneak in an extra charge has always been frustrating. Companies that charge extra for text messaging is a prime example. Text messages cost less than phone calls to deliver but consumers are often stuck with an add on rate, or with per message charges. Mobile WiFi devices can access the Internet and be used for unlimited phone calls, unlimited browsing and unlimited instant messages, for un-metered service and very low fees for metered service.

Produce a letter or spread sheet or presentation on Google and share it with whom ever you want. Edit the document from any computer, allow others to edit or have an online jam session about what the document should say. Who needs a desk top computer or a server? Put the whole enterprise online and do your work with a laptop on the beach.

Our politicians are in antagonistic mode. They are looking for ways to take money away from the most efficient and most productive ventures in order to subsidize their pet but unproductive ventures. Politicians are often willing to shrink the economic pie if they or their friends can be given a larger piece. The Google program is designed to grow the pie greatly but to get a very small piece of this very large pie.

Disclosure: None