Google's Android strategy failing in China

Google's Android strategy failing in China

Shiv Putcha/Ovum  |   October 16, 2012
OvumBesides Facebook, Google is the best example of a global internet powerhouse that has essentially been blocked from entering the Chinese market in a fair and meaningful way.
 
This dissonant trend is particularly noticeable in the case of Google due to the enormous success of its Android operating system in China. With Google unable to drive the adoption of its popular services in China, Chinese Internet and over-the-top players have gained considerably at its expense.
 
Chinese device vendors are using Android for their own purposes, and are increasingly at odds with Google’s preferred vision of Android’s developmental direction. As a result, Android is fragmenting beyond Google’s control, and Google’s Android strategy is rapidly coming undone in China with no immediate prospects for correction.
 
Barring an unlikely accommodation with the Chinese government, we believe that Google’s only short-term option is to try and limit Android’s Chinese variations within China’s borders.
 
iOS, Android are increasingly prevalent in China
 
In Ovum’s recent report, Smartphones in Emerging Markets: Shifting Landscape, we identified China as the biggest global driver of smartphone adoption. We believe that there will be approximately 250 million smartphone shipments in China in 2017, which will account for 17% of global shipments. Smartphone growth is already strong in China, and both iOS and Android devices are selling in large numbers.
 
The fact that China’s largest mobile operator, China Mobile, doesn’t have an iPhone offering hasn’t stopped the device from being extremely popular in China. The iPhone is not available for China Mobile subscribers as it is not compatible with China Mobile’s TD-SCDMA network. However, the new iPhone 5 is expected to be available to China Mobile subscribers.
 

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