Google in Talks with Verizon, Sprint on Phone Software

Includes: GOOG, S, VOD, VZ
by: Judith Levy

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.

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