Will Android Handset Be T-Mobile’s Killer Device?


Will Google’s Android smartphone be T-Mobile’s “Phone” and help the struggling wireless carrier regain much-needed market share and subscriber traction?

No one can know that answer or answers to other questions about the open source device’s features, until Google’s first handset arrives at year’s end. But one industry analyst said the HTC handset has the potential to make it happen.

“This is great news for T-Mobile, which has been struggling to find its answer to the iPhone and the [Sprint] Instinct phone,” Jeff Kagan, telecom analyst, told InternetNews.com.

“We are expecting this new device to do many of the same things,” he said. “The big question is will this device be a leader or a follower?”

Obviously T-Mobile is banking on the device to be a “leader” and propel the fourth-place carrier into closer contention with powerhouses AT&T, Verizon Wireless and Sprint. The goal is gaining subscribers and selling more data services contracts — key elements to financial riches in what’s become one of the most competitive industries in play.

T-Mobile, which declined to provide details about its contract or the phone, reported that it’s “on track to bring an Android-based phone to market in Q4,” a spokesperson told InternetNews.com.

Google was also tight-lipped on the T-Mobile news.

“To prepare for Android’s public launch, we are testing the platform on a variety of devices. This process ensures we have an opportunity to receive feedback from users. We have nothing to announce at this time but look forward to sharing Android updates with you in the future,” a Google spokesperson told InternetNews.com

Android, under the auspices of the Open Handset Alliance, is an integrated software stack including operating system, middleware, user interface and applications. The group has stated it will be made available “under one of the most progressive, developer-friendly open source licenses, which gives mobile operators and device manufacturers significant freedom and flexibility to design products.”

Google first announced its mobile phone plans back in November 2007.

At a developer’s conference this May, Google (NASDAQ: GOOG), which acquired Android in 2005, provided a flashy demo that showed a startup screen full of colorful icons for launching programs and Web services with the touch of a finger. A finger flick of the status bar brought up pending actions such as an appointment or unread e-mail.

The phone will feature
several iPhone capabilities such as a touch screen.

Yet whether such flashy features will provide T-Mobile the market push it needs is a big question considering the head start leading carriers have.

For example AT&T (NYSE: T) added 1.3 million new subscribers in the second quarter, and Verizon Wireless added 1.5 million in the same time frame. T-Mobile added just 668,000 new subscribers.

In terms of device sales it’s going to take a monumental feat to beat Apple’s Apple’s (NASDAQ: AAPL) 3G iPhone and the financial windfall it’s brought AT&T which was the initial carrier to market the handset.

About 3 million 3G iPhones, the second handset, were sold within the first three days after its July debut.

Apple has shipped more than a million iPhone units in three consecutive quarters, according to analyst reports, and Piper Jaffray analyst Gene Munster has predicted it’s on track to sell about 4.5 million iPhones worldwide in the current fiscal quarter.

And those predictions don’t even take into account the newly-announced deal that will have Best Buy (NYSE: BBY) retail locations selling the iPhone.

The Federal Communications Commission is reviewing the device software and HTC’s hardware to ensure both meet network standards. A spokesman told InternetNews.com there is no current timeframe on when that review would be complete.

Kagan said if the Android device brings features that “sweep users off their feet” the carrier could make huge gains.

“Cell phones are doing more and getting smarter all the time. We are expecting quite a bit from this Android phone. That’s a lot to live up to,” said Kagan.

The question, he said, is will the Android device do more than users are used to today or will it just be another contender.

“How easy will it be to use? How cool will it look and operate?,” said the analyst. “Going forward, the growth in the cell phone industry is in all the features you can use, not how many phones a vendor can sell. In that world the Android phone should do well.”

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