Google's $19B Black Box Is Worrying Investors | Hacker News Reader

Google's $19B Black Box Is Worrying Investors

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217 pointsrbanffy135 comments

It's rather sad that Google needs to pay Android makers a fee for installing it's apps, given how Google gives away source code that makes Android exist in the first place.

On the contrary, Apple's ecosystem is completely closed, app cut fairly high and non-negotiable at 30% and app store rejections arbitrary at best and blatantly anti competitive at worst. In the name of user centricity, their platform places arbitrary restrictions on code execution and access.

Who'd you think the EU would investigate for monopolistic practices?

>app cut fairly high

Same as Google's, so it seems standard.

>non-negotiable at 30%

Reduces for certain types of apps, given specific conditions, but yes for 99.99% it's non-negotiable. Still, it's their platform.

>arbitrary at best

I'd wager most rejections follow very clear rules. There are some head scratchers, but those aren't the norm, so "at best" is wrong.

>Who'd you think the EU would investigate for monopolistic practices?

Gotta have a monopoly in order to be investigated for it.

> Gotta have a monopoly in order to be investigated for it.

That implies that anyone investigated for being a monopoly already is one so why investigate at all if you already know the outcome?

There's nothing wrong/illegal with having a monopoly, what is illegal is having a monopoly and having anti-competitive practices.

Hence, you can only be investigated for anti-competitive practices when you have a monopoly because without a monopoly the free market provides sufficient remedies for such practices.

Apple sells Apple phones with Apple iOS.

Notgoogle sells Notgoogle phones with Google Android. Futzing with what another company does with it's product can get you anticompetitive interest.

If you want to talk about Apple being anticompetetive talk about how you can't buy/rent movies on Google Play, Amazon, etc. apps on iOS. Even so, Apple has a much better legal stance for curating it's own market than Google (Alphabet?) has for manipulating other companies' products.

>you can't buy/rent movies on Google Play, Amazon, etc. apps on iOS

Isn't that a choice Google and Amazon make because they don't want to pay Apple's fees for sales going through their marketplace? If that's the case, it doesn't seem anticompetitive, since everyone is charged the same fees no matter what. Google and Amazon just don't want to pay it.

Same thing as the Kindle Store, you can't buy Kindle books through the Amazon app but you can buy them through the browser. Because if you buy them through the app, Apple takes a cut, but they don't through the browser. So Amazon made the choice to not sell books through their app, even though many other merchants sell digital goods through their apps and pay Apple the fee.

> If that's the case, it doesn't seem anticompetitive, since everyone is charged the same fees no matter what. Google and Amazon just don't want to pay it.

Apple doesn't pay them. Anyone who wants to sell media on iOS has to compete with iTunes while subject to a 30% price handicap. If that's not anticompetitive I don't know what is.

I look at in in the context of physical goods. Grocery stores processs their private label meats. The grocery store also sells name brand meats but those brands have to pay for shelf space. The meat is exactly the same, just processed by two different entities - one who owns the store and one that doesn’t.

The situation you describe is a little different because people aren't locked in to a supermarket. If you don't want to pay the premium, you can go to a deli, another supermarket or have it delivered by Amazon. If you don't want to pay Apple a premium, you don't have a choice. You either do it or ditch iOS and lose all your purchases on the platform.

Maybe the situation is more analogous to joining Costco or Sam's Club where you pay a membership fee, i.e. buying the phone. Your point about losing all your purchases is a good one. I guess you could say you still own your purchases after you ditch iOS, you just can't use them with other platforms - but since all the food you buy gets consumed, it's a unique scenario.

The problem is that Sam's Club and CostCo still have alternatives, even with their membership fees.

Imagine that you paid $1000 for a 1 year CostCo (iOS) membership which gives you access to CostCo but only on the condition that you live in CostCo Village, where you can only buy Certified Approved™ products from CostCo (which have a 30% markup) and if you choose to leave, you'll lose everything you bought while you were there. Home, furniture, electronics, everything. CostCo Village is a nice place to live and the products sure are nice but imagine 50% of the population living like this. From a consumer perspective it's shitty because you have no choice and from a vendor perspective it's shitty because you either play ball or lose out on half the population.

Sure there are Sam's Club (Android) Villages where you can still buy from other chains or independent grocers but it's just stupid that you have to make this choice.

Here’s one, you buy a Mac and use it for 5 years with all your Mac software you bought and then you decide to switch to a pc. None of the software can be used on the pc, and you have to buy it all again for the new machine. Consumer hates it, developer loves it. The intangibility of software makes for a bad comparison to using/buying physical goods. Switching does suck for consumers, but I think you’re very wrong about it being shitty for developers. They have a new opportunity to sell their product! Also, there’s a reason why vendors pay a huge premium for Costco shelf space - it’s worth it. To have instant access to Costco members for vendors is a big deal, otherwise they wouldn’t be there.

Another thought...we live in a capitalist society (assuming you live in the US). With the customer base that Costco has, you can’t realistically expect them to give away the most valuable thing they have to vendors, can you? Sure if you run a single convenience store you can’t charge for shelf space, but if you run 1000 of them you probably can. So if you’re Microsoft for example, you need to beg developers to build apps for your mobile OS because the value proposition i.e. paying users just aren’t there. Flip that story on its head and you have Apple.

Also, I don’t quite understand what you mean in your last point....

Anti competitive or not, it’s terrible for consumers.

Well it's terrible for consumers that Intel charges money for their processors too, but such is capitalism.

But, it’s really not that terrible. Intel has plenty of competition; if you just need “a computer” you can get a rpi for $25.

Realistically there’s no way to buy digital video without also fucking yourself into a walled garden that restricts your use of your own licensed content. There is no real competition there for the experience people want—video they can play on whatever they want to, whenever.

If a $25 Raspberry Pi is in the same league as a full Intel computer, surely a DVD is in the same league as renting a movie on iTunes.

It is for many cases of computation! I can do my bill paying, writing, and much of my coding work from a raspberry pi; for those things, it’s a suitable replacement. These days you can get an entire phone that outputs to your tv that is hackable, cheap, and has access to relatively quality proprietary software.

And yea, a DVD is in the dame league, but it’s a format that deteriorates with age. Not exactly an investment format like vinyl. At least you can back up MP3s and play them with any software you like.

The reason Apple's actions aren't terribly anticompetitive is because the Android ecosystem is the competitor. Plus, while Apple is no doubt a major player in the phone business, they don't have anywhere near a majority market share.

The thing is if you sell a device running your software, there's no law that says you have to build in features and support for anyone else to install their own software. Feature phones are also computers, but there's no mandatory regulation compelling vendors to allow installation of third party software. Going a step further, if you sold a device with a proprietary only app store, so it can only run software you provided access to, like a feature phone where some features could be downloaded, again what's wrong with that? You used to be able to buy children's computers with limited educational software you could download, probably still can. Would you compel the vendor to open up that 'app store'? Chances are such a regulation would kill products like that stone dead. Same with consoles. Any regulation you make for the App Store should really count against consoles too, wrecking their whole business model.

It's like a slippery slope. If you enforce rules that say Apple must allow side-loading of software, doesn't that mean any computer should provide that facility? What if that opens up real security risks, is it really regulator's jobs to open up vulnerabilities like that? It's a massive, horrible can of worms. At the end of the day, if you want an open platform like that you can build or buy one. There's really no benefit to the market to mandate that all platforms must be like that though. If open really is better, then it should win on it's own terms not through regulatory fiat.

Android market share in Europe is around 75%. When you have a monopoly market share, you get treated differently, as Microsoft found.

Otherwise, Google wasn't found guilty of anything to do with software or apps. It was found guilty of abusing its monopoly market power by promoting its own shopping comparison service at the expense of rivals.

I think we all expect Google to deliver honest and fair search results. When it delivers results that favor its own properties, users are being cheated.

> It's rather sad that Google needs to pay Android makers a fee for installing it's apps, given how Google gives away source code that makes Android exist in the first place.

This is a very innocent view of Google's business practices in this area. Google has a tight hold over most device makers through anti-fragmentation agreements and other contracts if they want GMS and want early access to the non-public AOSP tree, which is a practical necessity to ship cutting-edge Android devices. Aside from hard legal power, Google also projects soft power through their control of the ecosystem and device makers wanting to maintain good relations. As a result, Android-derived innovation in the ecosystem is highly constrained even if AOSP is open source licensed since device makers and manufacturers cannot ship devices with Android-derived operating systems in device categories enumerated by the AFAs unless the devices pass CTS (which prevents most kinds of serious divergence from Android).

You're free to run your own app store, like Amazon fire devices, and not subscribe to GMS. Why shouldn't Google get something in return for enabling phone makers with an OS and app store? They're a for profit company after all

Sure, and the AFA has a pro-developer and pro-consumer side by reducing fragmentation. But I think it's important to understand that the open source aspect of Android is a small part of the story in practice for device makers. The narrative that Google is just "giving it away for free" is naive at best for the very reason you state: they're a profit-driven megacorp.

I'm not naive, but everyone takes the OS source code and platform for granted, and asks, "what else can I get"?

It's obvious that Android has enabled and continues to enable an ecosystem of hardware companies to thrive. These companies have tried repeatedly to build their own software, but with NO commercial success. Imagine a world with an Apple like Android, Google owning the software, closed sourced, walled, yada yada ... That's still a possibility if the ludicrous EU actions on Android don't stop. Google makes about 1/10th the revenue and 1/100th the profit off Android as Apple makes off the iOS product lines.

Android's ecosystem gets a LOT more out of Google than Google gets out of Android

EDIT: Samsung, LG, Huawei, ... they're even relevant in phones because of Google. I doubt it's the other way around. Samsung is SO scared of Google cutting it off that it tries repeatedly with alternate OS-es --> everything from Tizen to windows phones. Nothing sticks

> That's still a possibility if the ludicrous EU actions on Android don't stop. Google makes about 1/10th the revenue and 1/100th the profit off Android as Apple makes off the iOS product lines.

Google doesn't need to make money off hardware or software, it's an ad company. Yeah sure they'll just go and remove themselves from mobile ads market because laughable penalties EU apply on them.

FYI - the ad industry's future is uncertain, given the advent of ad-blockers & privacy laws. Selling phones with a proven OS, on the other hand, is a straightforward model.

If the EU's fines are laughable, I think the status quo will persist. But if Google is beholden to Apple & phone makers who use the very OS it provides & builds, cutting others off and owning the hardware isn't far fetched. Why do you think HTC was acquired?

Can you name another OS that has had as many forks as Android?

Unix ;-)

The Chinese Android forks probably outnumber all of the Unix forks. Additionally, every version of Android, built an OEM, is a fork of Android.

Wouldn’t it be better to just sell a product in exchange for money, instead of all this backdoor stuff? Like the good old days of Symbian.

> On the contrary, Apple's ecosystem is completely closed

Their App Store is a monopoly, but I have friends who use iPhones and use Google's Inbox, Google's search app, Chrome browser, Google Maps and Waze etc and don't use the built-in defaults. I guess they like the hardware. So maybe I'm not interpreting "completely closed" correctly.

> ... In the name of user centricity, their platform places arbitrary restrictions on code execution and access.

As a software but non-iOS developer I like these restrictions. Yes they can be annoying (you can't use your iPhone as certain kinds of portable network scanner because they restrict access to the MAC) but they also stop shitty and malign developers from screwing me in certain ways (jerks were using the MAC as an illicit user tracking device).

I see it like various sorts of regulation: everyone us better off if the paint factory can't simply dump its waste into the river, even the paint company.

I'm one of those people who gladly use an iPhone with mostly Google apps (namely Chrome, Gmail and Maps). My little experience with Android has always been negative.

The only real annoyance with iOS is you can't set Chrome nor Maps as default applications.

I'm in the same boat. My dream device would be iPhone HW with Android software. I like Android's flexibility, the replaceable home screen instead of the list of apps, the Intents system that lets you replace an app handler with another (Chrome & Maps for example), the much better notification system...

I have an iPhone now (because work), and it took a few months to stop grumbling, but I definitely appreciated the overall better hardware compared to my friend's Android phones, most significantly the excellent (and immediately available!) camera.

On Android 6 at least, double tapping the home button brings up the camera immediately.

I'm thinking more of the hardware lag, especially the horror stories of the Nexus 6 and to a lesser extent Nexus 5X.

Is this FUD? I have a Nexus and it's still working wonderfully.

One of the issues is that running Android software on an iPhone inherently breaks a lot of the things that you love about iPhone. The reason is because of Apple’s verticals integration. Running Android would negate this and likely result in a not-so-great experience compared to native iOS.

Samsung hardware has blown Apple out of the water for the last 3-4 years. I want Samsung screens and form factors with iOS. iOS is what makes iPhones great!

Android is a giant tracking/ad/malware machine. It’s far too permissive to applications you install on it. My most recent negative experience were pop up ads that the Peel Remote started showing on my home screen. Peel remote is one of the force installed applications that Samsung’s touchwiz installs. It’s like Windows 95 with OEM bloatware, but worse.

> Samsung hardware has blown Apple out of the water for the last 3-4 years

No one familiar with the impressive lead in mobile CPU design Apple has carved the past few years would ever make this claim. It's far more than just iOS making Apple's iOS devices great today.

You're wish for a better display is definitely valid though, and arguably gets granted at the end of this month.

Aren't the A chips Apple make really good?

And are the cameras really inferior?

>My dream device would be iPhone HW with Android software

It's called the Pixel 2.

Nah, sorry to break it for you, but the Qualcomm chip is nowhere close to A11.

Yeah, sorry to break this to you, but that A11 isn't fairing too well against Android phones.

https://www.youtube.com/watch?v=8kpD3XCp49o

https://www.youtube.com/watch?v=2G669OgskM0

Let's see how that A11 is on battery efficiency:

https://www.youtube.com/watch?v=IbSjUq_kvSM

How does that battery life test show anything about the A11’s efficiency?

- The displays will be drawing a huge majority of the power—diminishing the effect of the processors.

- The batteries have massively different capacities.

The A11 is on a smaller die size and yet the battery usage has actually regressed from that of an A10 [1]. Additionally, the displays do draw a lot of power, but so does video processing and games and the A11 doesn't seem to offer that much of an advantage, if any from a battery perspective, than the A10.

[1]https://www.youtube.com/watch?v=e-691mHL1to

I'm not going to watch any more 10min hobbyist benchmark videos.

My pencil has lower power consumption than all of them. It also processes zero instructions per second.

The ability to ramp up your speed at the cost of higher power consumption is a feature, not a bug. You finish the workload faster and therefore the total energy consumed will be lower.

It's funny that no serious person from Qualcomm who works on Snapdragon will with straight face support your point of view about the processor comparison. In fact, they would shit their pants looking at A9 in 2017, let alone A11. I know cause I have talked to a couple. :)

The SD 835 and A11 are sort of out of sequence in release cycles as the SD 835 is over 7-8 months old. A better comparison would be between the A11 and SD 845.

As for Qualcomm, they're really not an innovator in the SoC space as they just take whatever ARM gives them and add their modifications. The ARM A75 cores in the new Q1 2018 SoC's will exceed the multicore of the A11 and be about 25% slower in single core I predict.

> compared to my friend's Android phones

One universal fallacy I've noted since the beginning of Android and iOS is seeing people compare $30 Android phones with iPhones, which target only the premium part of the market. I've used primarily the Galaxy S line but my friends have had Nexuses etc, and the hardware quality (screen, camera, compute speed,build quality) has been about as good (with variance in both directions) as contemporary iPhones for many years now (helped along by the fact that the galaxy S6 aped iPhone's design pretty aggressively).

Don't worry, your default browser is safari and will always be safari. The chrome browser isn't really chrome, just a reskinned safari. Apple doesn't permit any real browsers except safari.

Or inbox/gmail. All mailto links are hardwired to the shitty built-in imap client.

    > The only real annoyance with
    > iOS is you can't set Chrome nor
    > Maps as default applications.

Or indeed Gmail. Apple Fanboi that I am, I'd love to see them hit with an anti-competition suit in the UK that forced them to publish APIs to allow other apps to replace the core suite.

> Chrome browser

It's really Safari, but with Google services. Apple forbids other HTML rendering engines.

Isn't it only other JavaScript interpreters/JITs specifically it forbids?

I mostly agree with you except

> Their App Store is a monopoly

That word gets thrown around too liberally. Does anyone expect the Apple App Store to be able to serve apps to the Android, Windows, or Linux ecosystems? Arguing that "Apple's App Store is a monopoly" is like arguing that "JCPenny is a monopoly of all goods sold at JCPenny stores". If you want to sell goods in a store, you must abide by the stipulations of a contract with that company.

You have it backwards. Their App Store has a monopoly on distribution of apps for iPhones. I can't publish my app somewhere else, which means I have to get Apple's permission for anything I want to publish (to non jail-broken phones).

”...I like these restrictions.”

Yup. I will only do tech supp (for friends, family) for macOS, iOS. Bought both gf and mom Apple gear. My life is now much easier.

We all love Google's products but your comment is needlessly emotional.

Google is not charity, it's always good to remember that.

Google is not giving away the source code of Android for philanthropic reasons, it's just part of the business model, i.e. the process of money making to pay the employees and the shareholders.

Oh and Apple is definitely not putting arbitrary restrictions to anything, all the restrictions have a reason - that you might or might not agree to but definitely not random. In case you want to bypass Apple and run a code on your iPhone, you can do it by compiling it and installing it personally.

I think EU will investigate the companies that have large enough marketshare that they can abuse their position.

I agree with some of your critique, but I also think you are giving Apple a little too much credit. Yes you can compile and install your own software, but AFAIK, you have to pay a yearly fee for the privilege of doing so. This isn't nearly as open as Android phones, where it is a simple matter of checking a box.

I definitely agree with you that Google isn't giving away the code for philanthropic reasons, though. I can't really feel bad for them for having to incentivize handset makers to do things that make Google even more money.

> AFAIK, you have to pay a yearly fee for the privilege of doing so.

That hasn't been the case for a number of years. As long as you have a Mac, you can download Xcode for free, compile an app, and sync it over to your iOS device.

Super simple to do as an end user, for sure.

Your average end user who requires things to be simple is never going to install their own apps outside the approved, simple channels.

There are multiple thriving app stores in the global android market

I’ll take one App Store over many anyday if it severely lessons the chance of getting malware.

Would you also take one news source over many if it lessens the chance of seeing "fake news"?

Would you take one false equivalency over another if it lessens the chance of an "ironic reply"?

Choosing your app store and choosing your news source aren't equivalent, but they're both desirable (for related reasons).

> Would you also take one news source over many if it lessens the chance of seeing "fake news"?

Yes. This is why, every morning, I first get my news from trusted sources.

Who picks those sources - you or your phone's operating system vendor?

You are not replying to my meaning or intention. The context of the discussion was clear. You’ve taken it in a wholly different direction.

Needing a Mac is an extra expense in itself. I fail to see much difference.

Sure. A company doesn't choose to spend hundreds of thousands or millions of dollars per year to port their development tools to a third-party platform.

I'm sure if they believed they would get more & higher quality developers to build apps by doing so, they already would have.

Makes since, especially since Windows historically hasn't done the same for Visual Studio / C# (I know they're supposedly trying now or planning to but I confess I haven't followed along closely enough to determine if it's cancelled, delayed, or the scope was actually smaller than full dot net + c# support).

> Yes you can compile and install your own software, but AFAIK, you have to pay a yearly fee for the privilege of doing so.

While this was true in the past, this hasn't been the case for a while if you want to build and run on your own personal device. There are some minor caveats, but if you want to compile and run an app locally on your device you don't need to pay Apple the $99 any more.

The idea that the version of Android that most people actually use is "open" is arguably a myth - when you look at what the "closed" parts of Android now include, it's a large amount of the feature set that actually matters to most ordinary consumers, and is often the "stick" Google uses to get OEM partners to follow the overarching vision for the platform.

This is only true if you're fine with reinstalling the side-loaded app every week. This is a pretty major caveat imo. If you want the app to stay on your device past a week you need to buy the paid Apple Developer subscription.

I keep reading this but my experience is different: I have built and installed two applications on my iPhone more than a month ago and they still run just fine. I didn't have to re-install them every week.

My paid developer subscription expired two years ago. I suffer from all restrictions of the free tier (can't publish to App Store, can't use StoreKit, SiriKit, etc) except for the need to re-install the app every week.

¯\_(ツ)_/¯

Could other people confirm/deny the claims in this comment thread?

> There are some minor caveats

One of the "minor caveats" is that the app only runs on your own device for max 1 week, after which it will have to be reinstalled via Xcode.

Which basically makes this useless even if all you wanted to do was run your own code on your own device. I have tried this for small apps I made for myself, but after re-installing 2-3 times, the annoyance was too high for me to continue.

In contrast, and while I am way more experienced and comfortable with the Apple SDKs/dev environment, deploying a small app that I built for my wife was ridiculously easy, and continues to run fine without me touching it for more than a year now.

>Yes you can compile and install your own software, but AFAIK, you have to pay a yearly fee for the privilege of doing so

Yes. And you have to own one of their overpriced computers too.

Not necessarily. There are third-party tools (such as Cydia Impactor) that are cross-platform.

You don’t need to pay a fee but you do need a Mac.

Oh for goodness sake, go and get yourself a GNU Stallmanphone or whatever along with the other five or six owners and leave the rest of the world alone. What the heck did Apple ever do to you?

Hilariously enough, your comment only makes sense if you assume that everyone else is as pathetically and irrationally emotionally invested in their consumer choices as you clearly are. It's entirely possible to complain about one of the downsides of apple's approach without thinking being an extremist on the position of consumer control of their computing devices.

For example, I use Ubuntu instead of eg Windows; someone as simple-minded as you could make the exact same complaint: "why don't you go compile Linux from scratch and leave the normal people alone".

But this would be missing the part of the picture where eg I chose Ubuntu over Debian because the small extra hassle of Debian's extra commitment to free software means not being able to do things out of the box like use certain codecs.

People are capable of choosing different points on the spectrum of convenience vs controlled solutions, and those of us who aren't incredibly immature are able to discuss their pros and cons without turning everything into a holy war.

> What the heck did Apple ever do to you?

Jeez, this part is just embarrassing.

> your comment only makes sense if you assume that everyone else is as pathetically and irrationally emotionally invested in their consumer choices as you clearly are...this part is just embarrassing

Your comment is stronger without this.

Look, I agree with you to some degree, and I'm sorry that you got downvoted for simply calling for being nicer.

But if my comment was simply "here's why you're technically not correct, easy mistake to make", it wouldn't quite be communicating the same thing. Namely, what a low opinion I have of turning every discussion into a fight, and how damaging I think it is to discourse of any kind (and without even including the actual rebuttal! The comment was 100% insults). I appreciate the feedback, but I'm not sure I agree that my comment would be stronger. If anything, it would be legitimizing ss part of the conversation a comment with no substance except broad, irrelevant insults.

Hmm, I just find it frustrating when posts imply that one company or other, Apple, Google, etc is somehow cheating just simply by being better at something than everyone else. And yes I know there are some sharp and anticompetitive practices out there, but just being good isn’t anticompetitive.

If Apple computers were overpriced, they wouldn’t sell. Why is it strange that you’d need and Apple device running Apple software to develop software for other Apple devices? Isn’t that sort of expected? Should Apple be required by law or even moral imperative to port all their development tools, libraries and services to other operating systems? Why? Yet it’s somehow a terrible injustice that you can’t write iOS apps on Windows it Linux it Solaris or VMS or whatever.

It’s just funny how someone can look at the millions of happy Apple users and successful app developers and lose their shit over it. Move on with your life. Other people being happy and enjoying and thriving on something shouldn’t take away any of your fun.

Sorry you're getting downvoted to oblivion.

These types of comments belong on reddit, not HN.

Really tired of this argument. Do you really expect to do software development with little to no investment in software and hardware? Even if you are just developing for Android you need to buy a PC and an Android device. If you want to test Android software on a PC be prepared to spend money to get a machine powerful enough to run Android emulators at a tolerable speed.

This a bit of a ridiculous response. If I'm developing for Android I can use a PC of my choice using Windows, Mac or Linux. Android emulators run acceptably fast with KVM even on low end PCs.

I have no interest in Mac hardware, it is stupidly overpriced for what it offers and what I need it to; and what I need it for it's bad at: Running Linux well.

But guess what? I can still actually _run_ that android development environment on any damn machine I want to.

Why would you be 'really tired of this argument'? It is a verifiable _fact_ that Apple requires you to own one of _their_ PCs in order to develop IOS apps. I can't use a Lenovo. I can't use a Dell. I can't use an iBuyPower gaming laptop that blows the specs of their shiny Macbook Pro out of the water. You see the problem? You have no actual _choice_ with your development machine when developing IOS apps.

There is no 'argument'. That is just how it is. And it keeps vast quantities of people that _might_ develop quality IOS apps out of their ecosystem.

>Google is not giving away the source code of Android for philanthropic reasons, it's just part of the business model, i.e. the process of money making to pay the employees and the shareholders.

They're also "giving away" a smaller and smaller fraction of Android with each release. This article is four years old, but quite relevant: https://arstechnica.com/gadgets/2013/10/googles-iron-grip-on... A non-exclusive list of Android apps that are no longer open source: Camera, Gallery, Keyboard, Music.

In order to include any Google apps or use the Android trademark, you are required to include almost all Google apps and make no other apps default. Further, Google makes it substantially easier to license their apps if you join the Open Handset Alliance (OHA), which contractually prohibits you from building non-Google approved devices.

I am very happy with Apple's restrictions. It's the only large IT company which cares about my privacy, and I don't want to have any apps which do whatever they want on my devices.

Likely Google because Apple doesn't enjoy significant market share in the EU

iOS market share in the UK is generally over 40% and has approached 50%.

http://uk.kantar.com/tech/mobile/2017/april-great-britain-sm...

Paying a fee makes economic sense. Open sourcing Android is an (rather successful) attempt to expand market share at the initial stage, considering that Android phone makers such as Samsung and LG already have established brand before the Android hit.

The fee Google's paying is for these established phone makers to distribute Google apps to a large market. The deal Google made with these companies is probably not as simple as "I open source Android <--> You distribute my apps for free" although these two things seem like a trade-off from a developer perspective. It seems, to distinguish itself from Apple's ecosystem, Android advocates for fair competition and its "openness". Google will get unfair advantage to all the other Android app developers if they get to distribute their app for free across Android devices.

The truth is, unless they are all Richard Stallman, all these companies open source stuff as a business strategy rather than from a pure good will.

IMO they should investigate both. I do know that bundling hardware and software together allows apple to do whatever they want, but it still horrifies me that on a general purpose device, there is a gatekeeper raising arbitrary rules on what apps I can install (or sell for the other side of the equation).

While Apple's practices have been worrying me for some time, they are in no way mutually exclusive with Google's ones.

The Android source code isn't Google's to "give away". It is written and maintained by a huge ecosystem of hardware and software vendors and independent developers.

What does Apple have to do with Google's antitrust trouble? Google was fined for abusing its monopolistic position in the search-engine market. Apple does not have a monopolistic position in any market.

Google isn't giving out Android source code out of the goodness of their hearts. It's a business decision. They also have decreased the amount of code that is open source if you measure things in a certain way (everyone has their bias). Since more and more Google services and apps are central to Android normally, those aren't open source. I think even certain standard apps aren't open source anymore.

We can appreciate open source software while still being aware of why it is happening. We shouldn't just be blindly grateful. That can end up biting us.

I can't help but have a bit of schadenfreude here. Part of what happened was that Google used to send a fair amount of organic traffic to smaller sites. And many of those smaller sites had Adsense ads.

Google's changes in search shifted much of the traffic that went to smaller sites to larger, more established sites. Ones where the cost per impression/click are higher for Google.

So, part of it is self inflicted. They did, of course, get benefits out of that in the form of less low quality sites in their ad inventory. But some babies went out with that bathwater.

> Google's changes in search shifted much of the traffic that went to smaller sites to larger, more established sites. Ones where the cost per impression/click are higher for Google.

Do you have a reference that Google detuned their search for profit purposes? I'm happy to believe that Google did do evil, but I would like some evidence. This kind of change sounds short sighted.

>Do you have a reference that Google detuned their search for profit purposes?

That's not what I said at all...I was saying their costs were higher as a result. They detuned it to reduce the number of low quality sites appearing in Google search results. I am speculating on one particular side effect that had. I have no proof, because only Google would have the data needed to prove that.

> That's not what I said at all...I was saying their costs were higher as a result.

Ah, thanks. Sorry I misunderstood what you'd written.

> They detuned it to reduce the number of low quality sites appearing in Google search results.

Interestingly Google Search results have degraded heavily over the years, and for many topics almost entirely consist of bullshit SEO sites and arbitrary-keyword-generation sites (http://foo-shit.com/freude-des-schadens = automatically generated page about "freude-des-schadens").

Agreed. My anecdotal experience is that the number of low quality sites has increased dramatically.

I put this down partly to the "freshness" algorithm. You get shown the most appalling crap on the grounds that it appeared within the past few hours.

If you're a share cropper in the news blogosphere, it's stupid to spend an hour checking facts or making phone calls because then you'll be 50th to post. Post any old crap and you reap the financial rewards of "freshness".

I exaggerate only slightly....

During the FTC investigation it came out that Google started with a goal and then kept changing the questions for raters until they got the data they wanted. Apparently they needed the rater data to approve the search algorithm.

There is a sweet spot where results don't suck and are better than Bing so users don't leave and ad clicks increase. Personally, I am 100% sure Google has found it.

I agree with this. Another tactic they've optimized is pushing the organics down for many searches such that only ads and Google content remain above the fold.

I think they may be at the point where the obvious dramatic optimizations are all played out. It also doesn't help that the high margin desktop traffic (versus lower margin mobile) is waning.

Eventually, that slows the trend where their ad revenue growth has been outpacing general internet growth.

The trouble is that investors are still expecting the same trajectory. Reverting to revenue growth solely driven by traffic growth will be a bitter pill.

Google announced many years ago (might have been like 8 or something) that it will start to emphasize more on "brands" in the search engine. That focus on bigger sites has only steadily increased.

$19bn. We all knew about Google paying Apple to stay on the iPhone. That's $3bn.[1] There's the old deal with Mozilla to be the default search engine in Firefox, but that's over. But there must be a lot of other deals to add up to $19 billion.

That Google has to pay to be on the front of Android handsets is surprising. Isn't that enforced by the bundling agreement Google requires to use the Google-proprietary parts of Android? That's how Microsoft forces their stuff onto PCs; they don't pay PC vendors.

The non-Google Android phone business is pretty dead outside China.

[1] https://www.cnbc.com/2017/08/14/google-paying-apple-3-billio...

I wonder how much Google pays PC manufacturers to have Chrome as the default browser. A few years ago I purchased a Lenovo laptop that had Chrome pre-installed as the default. The desktop shortcut label was simply "Internet Browser".

Back in 2012 when they were still pushing chrome market share it was $.50-$5 depending on product and manufacturer

Google easily makes the money back over time. A PC is used for many years over which Google shows those consumers tens of thousands of ads, easily worth more than the unit cost of a default browser deal.

Microsoft gives OEMs a $10 discount if they use the "Windows with Bing" edition: https://www.windowscentral.com/windows-81-bing-costs-10-oems...

I think Android has some revenue sharing agreements with handset manufacturers that are more generous, but Android manufacturers theoretically have more options than Windows OEMs.

I wonder how worse it'll play out if Google pulled the plug and stopped paying these fees. These companies would be left with nothing but inferior alternatives (Bing, Yahoo, maybe DDG?). Mozilla tried this by cutting out Google for its default search engine and I don't think it made any meaningful difference.

I think, in a certain sense, Google is a risk-averse company. It simply won't gamble with its user base, no matter how high the costs are. Considering the cash arsenal the company has, I don't think it's a bad use of capital for Google.

>>Google is a risk-averse company. It simply won't gamble with its user base, no matter how high the costs are. Considering the cash arsenal the company has, I don't think it's a bad use of capital for Google.

If ain't broken...plus who knows, MS or Apple might just jump in and the they do have the cash. Would you want to be the Google exec that started the downfall?

Frankly even a nice chunk of Android development is a sort of traffic acquisition (Search bar for one.)

>Mozilla tried this by cutting out Google for its default search engine

Did Mozilla really cut out Google or did Google not want to renew the deal after it expired?

Word on the street is that Meyer was desperate enough for market share that they actually outbid Google for the Firefox deal. I think Mozilla is supposed to publicly release financial data every three years, and the last time was 2014, so we might know for certain soon.

Bing isn't that inferior these days. Arguably their video search is better than Google's.

Their main search results are plenty good enough for most normal use cases.

I found some statistics a while ago that seemed to indicate a big chunk of Firefox users who got Yahoo as the default, kept Yahoo as the default.

My own anecdote: when Yahoo became the default for Firefox, the drop in quality was noticeable, but not enough for me to abandon it immediately. I gave it time to see whether the difference in quality was only because of the extensive profile that Google has on me. After a while I stopped realizing that the search results weren't Google (it helps that Yahoo revamped their results page to imitate Google, which was probably a very wise decision); it turns out, that for most of my searches, Google-level quality doesn't matter (e.g. "apple turnover recipe"). I switched from Yahoo to Bing once the Verizon buyout began. Nowadays I only search Google when I need to find an obscure and specific page that isn't already in my browser history (since Firefox's history search via the URL bar is damn good).

Why is it a "black box"? Is it because Google doesn't break down the number or elaborate on the details of each contract?

Also, an increase in share price (Yandex) doesn't necessarily correlate to a change in actual usage.

Perhaps that it just isn't broken down into basic buckets like "Adsense" vs "Doubleclick" vs "All Other".

It's material enough on earnings to need reporting but the precise numbers are of competitive value.

Probably if more than 2/3 of it were paid to one company the CFO might consider that material and then we'd learn.

Google may have expected the Android ecosystem to resemble the DOS/Windows ecosystem of the past ie many diverse companies competing for market share.

It hasn't turned out that way. A few major players have come to dominate the cell phone market and the also rans have mostly exited the market.

The major's market share now gives them the clout to demand higher fees from Google. And all of this has led Google to now compete seriously with it's Pixel line of phones against Samsung and Apple. Now the big boys will battle it out.

This is not true at all. A huge number of OEMs have come out of China and (to a much lesser extent) the US over the last few years and taken substantial market share. Huawei, Xiaomi, etc.

Ok, but is this the demographic advertisers are trying to reach?

Less than ten percent market share - whoopee, who cares?

Xiaomi sold half as many smartphones in 2Q17 as Apple. Huawei sold about as much as Apple. Apart from Samsung, the Android brands that are well known in western markets -- HTC, Motorola. Google, LG, Sony -- aren't relevant globally.

https://www.idc.com/getdoc.jsp?containerId=prUS42935817

Everyone is paying more to acquire users these days. I haven't read the book that coins them as 'attention merchants,' but it seems like an accurate description, and their product is getting to be scarce and expensive.

I've got things to do, and when I waste time I'd like it to be wasted in a way that relaxes or recharges me or the people I care about.

Not that there isn't such a thing as good advertising, but the trick seems to be targeting. If you can't target people who actually want what you're offering to them, it's a waste of everyone's time and people will start tuning you out. Worse, you really have to hit them when they want what you're selling.

Like, when I go to Digikey and see an ad for some company's 48V/166F supercapacitor bank, or a new line of 16-bit ADC chips? Yeah, that sort of thing is a reasonable bet. When I go to a news story and see an ad for a VR headset? Not...quite.

A big problem is that once being a bulk attention merchant isn't appealing, they'll double-down on finding ways to creepily invade your privacy, profile you, and resell that profile to companies you'd rather didn't have your information.

We need a browser that is more private than what we have today. Something to hide the IP and separate online identities on various sites, and monitor the data being sent out not to contain your personal information, even if it was sent by your own mistake (like, referencing your secret reddit account on your public name email).

Privacy has similarities to hygiene. We have learned, through a lot of suffering, the importance of hygiene in daily life, we need to learn a new kind of hygiene now, but people can't do that unaided.

I'd go a step further and state unequivocably that privacy is hygiene.

Hygiene is about preserving the health of a system, and violating principles of privacy endanger the health of social intercourse.

This is part of a large set of dynamics associated with technology in that there are systemic side-effects of any number of technologies which affect overall systemic health. The emergence of and/or management of these is itself a major mode of technological mechanisms.

http://www.etymonline.com/word/hygiene

Given Google's stock price floating close to all time high, this worrying might be a pretty narrowly impacting activity.

Perhaps if the box had been blue or green, it would not have been as worrying. A black box conjures up images of darkness etc.

But probably when this was brought up during the project at Google it was dismissed as "bikeshedding". Or in this case, perhaps, "boxshedding".

> if the box had been blue or green, it would not have been as worrying

Did you read the article? The “black box” isn’t a physical object. It’s figurative [1].

[1] https://en.m.wikipedia.org/wiki/Black_box_(disambiguation)

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