[joedoe55555]

Android has made Nokia nearly bankrupt already, Siemens/BenQ has stopped making mobile phones while Android existed. Windows CE/Mobile/whatever seems to have no chance on the market anymore, eventhough they seem technical superior! Palm completely failed with its WebOS.

In fact Blackberry is the last survivor of the old cellphone world. (EDIT: And Samsung of course, but they are just copying Apple stuff and get sued for it.)

The only ones having profit from Android are Google and HTC. Google because they created the system and run the App Store. HTC because they manufacture the reference devices and because they are cheaper than the rest.

Wake up mates, open source destroys the old business models.

[Sayter]

Google made only $550 million from Android between 2008 and 2011 according to figures from the Oracle trial (http://www.guardian.co.uk/technology/2012/mar/29/google-earn...), compared to $38 billion in total revenues for 2011. While half a billion over three years is not trivial, it is rather insignificant compared to $38 billion over one year for search advertising. Trefis analysis of Google's stock price estimates the value of non-Motorola Google Phone properties at 2.38% of their total stock value (http://www.trefis.com/company?hm=GOOG.trefis#/GOOG/n-1336?fr...). To use Warren Buffet terms (as per an analysis by Bill Gurley via Erick Schonfeld), Android is not Google's castle, it's their moat. (http://techcrunch.com/2011/03/25/search-googles-castle-moat). The point of Android (and to a lesser extent, Chrome OS) isn't to generate revenue itself but to protect search revenue (if, for example, iOS were to switch to Bing by default). Given that Apple CFO Peter Oppenheimer had stated in 2010, that iOS's App Store ran at about the breakeven point, and was therefore not a significant source of revenue for Apple, (http://appleinsider.com/articles/10/01/26/app_store_wildly_s...) it is not wholly unbelievable that Google Play would also be an insignificant source of revenue for Google (especially given the ratio of free apps to paid apps is higher on Google Play than on the App Store).

As for HTC: "HTC Corp. said Friday its unaudited second-quarter net profit fell 58% from a year earlier, as the Taiwanese smartphone maker struggles to compete with industry leaders Apple Inc. and Samsung Electronics Co. HTC said in a statement its unaudited net profit for the three months ended June 30 was $7.40 billion New Taiwan dollars ($247 million), down from NT$17.52 billion a year earlier. Its revenue dropped 27% to NT$91.0 billion from NT$124.40 billion." (http://online.wsj.com/article/SB1000142405270230414120457751...).

You are also incorrect about HTC manufacturing the reference devices. While they did make the Google Nexus One, the Google Nexus S was Samsung, the Google Galaxy Nexus was Samsung, the Motorola Xoom was technically the Honeycomb reference device (read as: Nexus), and the Google Nexus 7 is Asus. In other words, HTC has manufactured only one of the five Nexus devices (out of six if you count the Nexus Q). To assert that HTC is generating profit "because they manufacture the reference devices" is inaccurate given that the Nexus One was released in 2010 and no longer sold through first party sources such as Google Play (the devices available for purchase at the time of this writing are the Galaxy Nexus, the Nexus 7, and the Nexus Q).

There is, however, someone making a profit off of Android: Samsung. From the same article: "In stark contrast to HTC's weak earnings, Samsung said earlier Friday that it will likely post a record quarterly operating profit for the second quarter that ended June 30. The South Korean electronics giant, which is due to release audited results later this month, expects an operating profit of between 6.5 trillion won ($5.7 billion) and 6.9 trillion won for the quarter, compared with 3.75 trillion won a year earlier." (http://online.wsj.com/article/SB1000142405270230414120457751...)

TLDR: The assertion that Google and HTC are (significantly) profiting from Android is incorrect and instead should assert that Samsung is the only one making (significant) profits from Android.

[joedoe55555]

Interesting numbers...

However those numbers are not everything. What counts is whether customers buy products or not. There are plenty of examples of successful mass products that were sold too cheap. For instance Microsoft's X-Box, they sold it much under price. You might list that under marketing costs. Their strategy however paied off, now they are a big player in the game device market.

Of course Google spend lots of money into Android, we don't want to imagine what all this patent crap and marketing costs. Android is however the predominant mobile platform and HTC its biggest vendor. (With reference devices I mean the actual devices that were supposed to be used by developers.)

Samsung is without question in a nice position but they are replacable, they are a big brand and they have a lot to loose. HTC appeared out of nowhere and is now one of the biggest players in the smartphone market. Just ask yourself who the real profit makers are.

Samsung is doing short-term profit. You know why? Because people don't by Samsung devices, they buy Android devices. It's not Apple vs Samsung vs HTC, it's iOS vs Android.

Going back to the actual topic: who cares what processor is inside an Android? Only the CPU manufacturers. The customers and the assemblers just care about software support and performance.

[Sayter]

HTC is not Android's "biggest vendor." Samsung Telecommunications has more device sales, more revenues, and more profit than HTC.

Nexus devices are the reference devices that were supposed to be used by developers: at the Google I/O conference, each attendee received a Nexus 7, Nexus Q, and Galaxy Nexus (http://www.computerworld.com/s/article/9228585/Google_gives_...). If you have a different opinion of what Android "reference devices" are, then provide them for evaluations by the denizens of Hacker News (of which includes a number of Google employees).

It is not necessary to "ask yourself who the real profit makers are," because the revenue numbers for HTC and Samsung are available to the public. The numbers state that Samsung is alreaduy generating more profit than HTC by a significant margin. Samsung's numbers have been increasing. HTC's numbers have been decreasing. Here are some articles that perfectly summarize the point:

"[HTC] posted its third consecutive drop in profit after cutting its revenue forecast amid competition from Apple Inc. (AAPL) and Samsung Electronics Co." (http://www.businessweek.com/news/2012-07-06/htc-second-quart...)

"Soaring sales of smartphones lifted Samsung Electronics Co.'s profit to a company record in the first quarter and executives said that a new model hitting dealers next month will fuel its financial results during the second." (http://online.wsj.com/article/SB1000142405270230472330457736...)

[joedoe55555]

Yeah yeah yeah, I might have been wrong with some details and with the sales numbers in 2012. However my main point stays the same: the traditional cell phone manufactures are in big trouble because of Android.

Samsung may be exceptional, although I doubt their current success is long-term. HTC's success, eventhough it is in absolute numbers smaller than Samsung's, is way larger in relative numbers. Samsung was popular before Android, HTC was when Android was released just a "chinese noname brand".

To illustrate this even more: HTC was founded in 1997, Samsung was founded in 1938.

There a many examples of companies that are able to make lots of money with hypes, but most often after the hype is over, they stop earning that extra money. Even when the current smartphone hype is over, HTC earned something that Samsung already had: brand recognition.

[lwhi]

Your original point was that no one's making money from Android apart from Google and HTC.

You were wrong.

[sbarlster]

I thought that MS made a stack of cash from Android via patent extortion methods?

[joedoe55555]

You have any evidence for that?

[spiralpolitik]

$792 million in patent royalties from just two companies in a single quarter, Samsung and HTC.

http://blogs.computerworld.com/windows/20792/microsofts-haul...

Nokia also made a similar amount in patent licensing from Apple. I believe Nokia is also suing HTC so might start collecting patent licensing from them at some point.

[berntb]

Google something like: Microsoft makes more from Android than windows phone 7

(It has been a repeated news story the last year.)

[jcheng]

Qualcomm? ARM?