Last Friday November 6th, the much-awaited Motorola Droid came out. Powered by the latest version of Google’s smartphone OS, Android 2.0, the new handset is exclusively distributed by Verizon. The carrier backs Motorola’s handset with an aggressive marketing campaign on its website and on TV ads.

For such a “gifted” (Motorola + Verizon + Google) product, the reviews came fast and… furious, that is very opinionated.
One gent rejoiced: Droid, was going to free him from the iPhone - at last! Small detail: as you’ll see by clicking on the link, writing on October 19th, a couple of weeks before the Droid came out, the “reviewer” helpfully admits he hadn’t used the product: “I haven’t seen the phone, but I’ve talked with someone who has worked directly with it”.
That’s why I prefer playing customer, buying the product, getting the everyday usage experience.
More “facts-based” reviews are available from MacWorld, quite positive, Endgadget, very detailed, Business Insider, with a crisp conclusion: If you don’t buy an iPhone, buy a Droid. The very geeky, well connected Gizmodo, comes to the same “if not iPhone then Droid” result. I’d be remiss if I didn’t link a summary of Walt Mossberg’s review, that’s how you know you’re an über-geek, when your reviews are reviewed. See also the Wall Street Journal’s gadgetmeister’s original oracular blessing.
A deeper discussion of OS platforms and voice applications is available here at TechCrunch. [Disclosure: one of the protagonists, British Telecom’s JP Rangaswami, bought Ribbit, an Internet phone company, imagine Skype with an API (Application Programming Interface). The venture firm where I currently work, Allegis Capital, was an investor in Ribbit.]
I’ll end the procession with a vigorous critique of Verizon’s punchy ad campaign by Andy Ihnatko, another respected, witty industry columnist.

With this in mind, unlike most opining individuals above, I went to a Verizon store and paid my own money to get a Droid. I did this on the very Droid-day, Friday November 6th, at the University Avenue Verizon store in Palo Alto, around 11:30 am. No line, I waited two minutes for a salesperson, a simple transaction as I already have a Verizon account. The activation turned out to be just a bit more problematic: ‘Too much traffic’ said the sales gent. I left the phone with him, went back to my office one block away. When I returned by lunchtime, everything was in order. Easy enough.

I’ve used the Droid for a week now and my own take doesn’t deviate much from what early reviews led me to expect.
As happens time and again, I hit the difference between a feature set, a check-list, and the user experience. For example, the keyboard and the camera.
The Droid’s camera sports more pixels, 5 million, vs. the iPhone’s 3.2 million. But, as reviewers pointed out, and as I can confirm, the Droid’s pictures are mediocre. As discussed here, megapixel numbers are often misleading. And it looks like the iPhone’s firmware also provides better selective focus and image processing.
As for the slide-out keyboard, I find it hard to use. Actually, it feels harder to use that the one on the original T-Mobile Gphone, the G1 I bought a year ago. The two phones are clearly related, similar keyboard arrangement, similar UI (User Interface); the Droid is more refined, thinner, it runs a newer, better Android release.
Important functions such as email synching with Gmail and Exchange do work well, so does the connection to an Exchange calendar. The turn-by-turn navigation application works as advertised. Actually, as I put the phone in my jacket, I kept hearing the turn instructions as I walked around town. The screen is nice and the on-screen keyboard works well; for me, better than the flat, hard to separate “real” keys. I like the on-screen keyboard because it allows on-handed operation: clicking through email, writing a short reply, flipping through blogs.
Software seems stable and battery life is good.
Like any other smartphone, media storage and playback fall short of the standard set by iPods and iPhones; no iTunes here.
All in all, a good product, one that will keep getting better with new applications and Android OS upgrades, one I would use absent other choices.
This said, when compared with other offerings, as I felt with the Palm Pre, if you want/need a keyboard, get a Blackberry. If you’re comfortable with a touch-screen keyboard, get an iPhone.
The Blackberry comes in a number of models, some can be had for $50 (with the usual two-year contract, at WalMart). RIM (the company making the Blackberry) has been at it for a decade now, their keyboards are, by far, the best in class. Blackberries are available with all carriers, their PIM (Personal Information Manager, mail, contacts, calendar) software is very well done. They’re #1 in the US for a reason.
As for the iPhone, it’s been praised enough: its meteoric climb in spite of the so-so (I’m being polite) AT&T network says something about its overall power and balance.

But, will the iPhone good times last? Even if today’s Droid isn’t an iPhone killer, won’t improved versions of the hardware, with future Android releases, combined with an entire smartphone industry eagerly adopting Google’s open source phone OS bring an end to the (perceived) iPhone dominance? That is the $100B question.

The answer comes in two parts.

First, there is ample evidence Apple puts profits before market share. As we saw two weeks ago, with less than 10% market share it makes twice as much money as HP and Dell who, combined, command 33% of the PC market.

This week, TechCrunch mentions a Strategic Analytics report showing Nokia commands 35% of the worldwide handset market while Apple’s share is a meager 2.5%. Respective profits aren’t in proportion: Nokia makes $1.1B, topped by Apple’s $1.6B.
Yes, Apple manages to squeeze fat profits from a thin market share. But, again, will this last?

For the second part of the answer, consider how Apple got where they are: by controlling all (or most) layers of the customer experience. Hardware, software, marketing, distribution, customer support. Contrast this with the formula at the top of this note: Motorola + Android + Verizon. As Android-based handsets do indeed proliferate, we’ll the see the kind of babelization we’ve observed in an other open source domain: Linux for the desktop. Google can’t tell handset makers what modifications they can and can’t make to the Android OS, it’s open source and handset makers will want to differentiate themselves. Also, each carrier will want to dictate what features they want and which ones they’ll block because they want to sell their particular content or services. Think of what happened with Windows Mobile and with Symbian licensees, no two handsets are alike, they run different versions of the OS and different applications.
We won’t have to wait: days after the Droid launch, Verizon just introduced another Android phone, the Eris, made by HTC. It runs a not quite compatible Android version, the earlier 1,5 release. Why?
(Between us, Motorola’s “own” Droid looks very much like a derivative of last year’s HTC G1, itself the son of Danger’s Sidekick. Danger, the company, is now owned by Microsoft, to what end we don’t know. Danger’s founder joined Google and runs the Android business unit. We’re all family.)

Lastly, Google’s business goals. Last week provided a clarifying glimpse: the company bought AdMob, a mobile advertising company, started in 2006 by Omar Hamoui, still a Wharton School student at the time. (Wharton is one of the top US business schools).
The price? $750M.
To belabor the obvious, Google is in the advertising business, its only money-making operation. The company saw the rise of mobile Internet applications, developed an OS (or two, we might hear more about Chrome OS this coming week) to be in the game and just paid top dollar for a mobile advertising company. While Google will continue to push its OS to prevent other players from controlling the market, its paramount business goal is to sell advertising (and, later, other services) on all platforms. In other words, Android babelization isn’t an issue as long as all these sets run a decent browser. —

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