HTC One, Android Zero

Photo of HTC One (HTV

There was a word missing from HTC’s unveiling of its impressive new HTC One phone. HTC executives talked about the BlinkFeed streaming home screen, the redone Sense user interface, the BoomSound audio system, and the Zoe photo-plus-video app. But there was no mention of the phone’s Android software. Even on the One’s web page, you have to drill down to specs to learn that it runs Android.

This downplaying says a lot about the branding efforts of both HTC and Google. HTC, having come through a very rough patch that saw its market share and profits tumble, is anxious to relaunch itself as a premium smartphone provider. Talking about Android cannot do this; mentioning Android just makes it look like a provider of commodity hardware running commodity software.

So instead, HTC is promoting the One brand as well as the subbrand it has chosen for the proprietary apps and services that it hopes will distinguish itself from the Android pack. HTC isn’t alone. Samsung has established Galaxy as its premium brand and is spending heavily in both development and marketing to establish a unique hardware identity. About the only one promoting Android these days other than Google is Verizon, with its Droid franchise. (Probably not coincidentally, Verizon is the only one of the four major U.S. carriers not offering the HTC One.)

Of course the One does run Android (version 4.1.2, to be precise) and HTC, which doesn’t offer much in software beyond the apps it has developed for the One, needs the Android app ecosystem and the Google Play store to make the phone valuable to users. But HTC’s handling of the announcement makes it clear how much the brand value of Android has eroded even as its market share has grown. For Google, which seems to be struggling to find a way to make money off Android, that cannot be a good thing.


Published by

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.

54 thoughts on “HTC One, Android Zero”

  1. Sure is good looking hardware. But as Dudley Moore’s character found in the movie “10” a 10 on the outside does not equal a 10 on the inside. And as Apple has proven time and time again, it takes both to be a truly satisfying user experience.

  2. “Brand value has eroded”? Not really. More like running Android is not a differentiator. Its almost becoming a given, if its not an iPhone its probably an Android phone. I doubt Google feels bad about the Android omnipresence.

      1. You’re right, but it’s not clear that the conclusion the article draws — that this brand value erosion is bad for Google — is warranted.

        If everyone simply assumes that a non-Apple phone will run Android (and will therefore be disappointed if it doesn’t ship with Google Play, Google Maps, etc.), then this puts Google in the same position Microsoft had in the DOS days. Nobody really cared about DOS at all unless it wasn’t there.

        That’s not a bad position to be in, really.

          1. Then later MS very often got paid for almost every PC regardless if it had Windows installed, that was the power of branding the OS. Google has no such advantage with Android.


          2. Right, Windows ended up being radically more profitable than DOS. But Microsoft had the opportunity to release Windows *because* it owned DOS.

          3. Google owns the app store and several of the most important apps, and these key parts are not open source. There are plenty of ways for Google to monetize its position in Android, only some of which it’s currently using.

  3. Google is struggling to make money from Android?

    No matter what UI or OS these devices use, they are going to be using Google Search. That is where Google makes their money. From the browser. And apparently mobile users love Chrome both on Android and iOS.

      1. Applies to Safari and Opera. But Chrome? It is their own product. I do not think Google is paying a dime for having Google Search as default in Chrome or the stock Android browser. And I do not think Google is paying anyone a dime for Chrome on Apple iOS where it is doing exceptionally well.

        Android makers are free to set the default browser on their phones. But when a user downloads Chrome, it comes with Google as the default search engine. I also doubt Google pays a dime to Android phone makers if it comes with Google search as default. Considering they are using a Google approved build and they are not paying for the OS.

        So what has Google achieved with Chrome? It saves them money that would have been going to (now rival) browser companies (Opera, Apple, Mozilla).

        1. We’re talking about Android, not Chrome, which is different from and predates Android. It is an uncontroversial statement to say Google has not made money from Android.

          Chrome costs money to develop and market. It may be that Safari and Chrome search users cost Google the same amount of money.

          1. Wow. Sounds like such a shortsighted point of view. Here goes nothing.

            Android: Google acquired it for around 50 million dollars. They have probably spent several times more on it since then. What has it gained Google? World’s most popular mobile platform. Prevented Apple from dominating the smartphone market. Provided a solid alternative platform to anyone who wants to create a functional portable computing device. But since, Google does not brag about how much they made from Android (just what they did with YouTube for years), I guess we can safely assume that Android is a financial disaster for them and they need to start worrying about how to recover from this mess. Indeed.

            Chrome: Google did not acquire it. Create it in-house. When it was good enough for a public release, they released it. What has it gained Google? World’s most popular web browser (StatCounter claims so, others have different opinion). What has it does for us? Pushed Mozilla to do better with Firefox. Pushed Microsoft to do even better with Internet Explorer (IE10 is fantastic). Help push the development of web technologies. We are now at a stage where Chrome on its own operate as an operating system. Now, has Google made money from Chrome? Not directly. So I guess we can assume it has been a financial disaster too and they should consider finding a way from recovering from this mess indeed.

            I am now concerned what has Project Glass and Driver-less cars achieved for Google. The company continues to make terrible financial decisions. They should have focused on monetizing the few products they had. Just like Microsoft. Why take risk like they did with YouTube… We all know how terrible that investment turned out to be. And yes! Motorola. 12.5 billion dollars! Wow. Google sounds worse than AOL. If you are an investor in Google, you should consider dumping all your stock and invest in Apple!

          2. Android is the world’s most popular smartphone platform. That is true. But is Android anything more than that? If we look at real world use, the answer is no.

          3. That’s not true. I mean yes it’s a smartphone platform obviously, but there are plenty of tasks that can be performed on Android devices just as easily as on a PC from CRM management to scheduling and web conferencing. There are a ton of things that separate Android from the original smart phone format.

          4. Yes, of course many computing tasks can be done on Android, but the real question is if Android users as a whole are using their devices as computing devices, and the data says that category of use is fairly light, the usage on all fronts is much lower than iOS. From a computing platform perspective a billion Android users looks very different from a billion iOS users. It doesn’t matter what Android is technically capable of doing, it only matters what the users are actually doing. Some are using their Android devices for complex computing tasks, that is true, but most are not.

          5. So how would it have been bad for Google if Apple had dominated smartphones?

            Please remember, that when Google bought Android. the big player in smartphones was Microsoft and Microsoft had Bing (and MSN search and whatever the precursors were called).

            Google was afraid that Microsoft might dominate smartphones and use Bing as the default search, thereby dominating mobile search.

            To counter that, Google created their own smartphone OS by buying Android.

            But what happened?

            Suddenly Apple appeared, destroyed Microsoft in mobile and Google made lots of money from people searching on iOS (and still is making lots of money on iOS, more than on Android).

            But when Android was released and Steve Jobs got totally pissed, Apple started to sever the ties to Google.

            YouTube-integration? Gone!

            Maps? Now from Apple!

            Apple doesn’t like being dependent on services (or hardware, see Samsung) from a main competitor and i wouldn’t be surprised if there are people in Cupertino thinking about search – and not only fact search like Siri (which also was a big “Haha!” targeted at Mountain View) but search in general.

            So instead of working together with Apple and being THE provider of search on iOS, they killed the partnership by releasing a competing product, that has a big marketshare but unfortunately, a lack of people actually using the product for search.

            Oh yeah, and they had to pay 12 billion for Motorola, only to make sure that they don’t get their asses sued off.

          6. Chrome does not predate Android by a long shot. At least not in development terms. If we’re talking release dates, I hardly think 21 days qualifies……

          7. On a dev note of course, Android was founded in 2003, but as far as public release dates go, both Android and Chrome were released in September of 2008.

    1. Yes, Google is struggling to make money from Android. They are at least $20 billion in the hole on Android, while at the same time, they have made a ton of money from both iOS and Web platforms.

      By the way, Google makes money from advertising, not search.

        1. $20 billion is a bit high but probably only a little if you include the sunk cost of Motorola. Google spent $12 billion to buy it and has accumulated at least a couple billion more in losses.

  4. HTC’s quality / price / marketing is not as good as Samsung. HTC should concentrate on little cheaper handsets with good features and good marketing.

    Further, HTC should tweak Android to offer better user experience. The stock Android is not good, like it does not have power button for screen-lock, restart, shutdown, etc.

    Android is One followed by two zeros (100).

  5. Google products still bundle with the phone that is all Google wanted when it bought and developed Android, Get back under your rock. You also miss that the large spec screen displayed at the HTC unvieling said ANDROID 4.1.2

    1. Wow you are rude.

      It is a matter of public record (Google it) that what Google wanted from Android was to make money advertising to Android-based phone users. However, they have not made money doing that. They make money advertising to iOS and Web users, but Android has not yet paid off its very significant development costs, which includes paying $13 billion for Motorola who has not made a profit since iPhone shipped, same as Sony and LG and Nokia.

  6. Because of Android and number of Asian OEMs, we, the general public, are able to use smartphones. Otherwise, we cannot afford smartphones (iPhone). Apple is not releasing low-cost, low-specs smartphones.Because of Android, we are able to get smartphones in India for less than Rs. 4000/- (USD 80). We all must thank Google for this.

    1. Apple will release a low-cost phone, just as they released low-cost iPods ($49 and up) and low-cost PC’s ($329 and up.) Apple is the newest major phone maker, they simply do not have a full lineup of phones yet. Samsung has been making phones for 4x longer and sells in 2x the markets.

      Apple also has been selling iPod touch for as little as $189 since 2007. If you buy one plus a $100 basic phone, that is a $300 smartphone with no viruses, regular software updates, and real PC class native C/C++ apps.

  7. “Google seems to be struggling”; what a BS!

    Android is among the biggest ever successes for Google.
    Google loves and enjoys developing Android and more than 100% committed for its future.
    Android most probably will be running on 80% of all smartphones in next couple of years.
    Google don’t need HTC/Samsung anymore because there are 100 other manufactures out there building Android phones.

    And one more thing this HTC One is nothing more than a paper weight in case it don’t come with Android….

    1. Having large market share does not equal making money. You changed the subject from profitability to market share and installed base.

      Google spent $13 billion on just Motorola alone, who didn’t even rate a mention in your post. Motorola does not make money. How are Google going to make that back.

      Check it out: Apple WebKit runs on even more phones than Android, but like Android, WebKit is given away to manufacturers and does not make money. It doesn’t make money for Apple if WebKit goes from 98% of phones to 100%.

      Google brings in money from advertisements on Android, but it does not yet offset the money Google invested in Android. Basic business.

        1. Yes, but for how long? Even Google has limits. Android is not profitable, as a business for Google it has yet to break even. Worse yet, Android is so commoditized and ‘behind the scenes’ now that Samsung or HTC, etc, could easily swap in a different OS and their customers wouldn’t even notice. That’s not good for Google.

          1. Other than search (with its advertising), does anything else Google does make money?

            Google is a one trick pony, desperately trying to come up with another trick.

  8. I still haven’t seen any comments or commentary on how beautiful this phone looks. Design is obviously a result of their settlement with Apple but it’s still gorgeous…

  9. A bad thing? Google itself has been distancing itself from Android as a marketing term for over a year now. You see any mention of Android in their ads for the Nexus 7? Nexus is their brand, not Android. Also, why did they decide to not have their big prescence at MWC this year (where last year they had all sorts of crazy Android-powered devices)? Because Android is mature enough that they feel they can simply support their partners making Galaxies, Ones, Droids, Xperias, etc. Obviously it’s no different than Windows…no PC OEM promotes that they have Windows, they promote their brand. Google doesn’t give a shit if people say Android or not – hell, they even renamed the Android Market to Google Play!

    1. “no PC OEM promotes that they have Windows, they promote their brand.”

      Hmm, that’s not what I see when I visit OEM websites and electronics stores. I am pretty sure it is a requirement before they can even offer a PC with Windows.


      P.S., of course they promote their own brand as well. But “Windows” is all over the product, including Windows Phones.

  10. It really isn’t about the brand losing value or anything like that. It’s just most people are smart enough to know most new phones run Android so we don’t need it stuffed down our throats every time a new device launches that, yes, it runs Android. All these companies have their own ‘brands’ though, hell even Google does as they are mainly responsible for the Nexus brand.

    1. But this all raises the question of just what Google is getting out of Android. The cost of Android, including the purchase price and accumulated losses of Motorola, is somewhere north of $15 billion. They could have bought a lot of search placement for that.

  11. The future of a more tainted android experience is coming, this article hits it spot on. I would argue that this is almost worse for the consumer than it is for google. Love the HTC one but am afraid of how capable it will be for me to design my own custom UI when I finally get bored of blink feed.

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