From a purely FOSS POV, Google never tried to build a community around Android. They develop it privately, and code-drop it when there is a release. Not even their partners (generally) get to see it before the public release. Without a public roadmap, the only kind of significant user contribution to the project is bugfixes (which are still welcome of course).
But notice that the problem is not "the rate of free updates", but rather the fact that Google is moving more and more development into the closed-source part of the operating system, while still trying to maintain the market line that the "operating system is free". But
which operating system is free? If you install AOSP on your phone (assuming you can and manage to go through the hurdles) you end up with a phone which is completely different from stock Android. That is my complaint: the difference between AOSP and the so-called "pure Android experience" (as on a Nexus) is widening more and more.
You say Android is available for free to "competitors". But as a matter of fact, AOSP (not Android) is available to competitors, and only those that are not part of the OHA. If you are a member of the OHA (so if you are an Android vendor of any significance), your contract says that you cannot fork Android; not only that, but you cannot even produce/manufacture a forked Android device as a supplier for an unrelated company outside the OHA (which is why Amazon has problems producing Kindle Fires, since all major manufacturers are also trying to sell consumer devices based on Android).
Moreover, if you fork AOSP, not only you don't have access to the Play Store, but many (most?) .apk won't even work on your device, since they rely on the proprietary Google APIs which are not part of AOSP. And this, again, is a widening ongoing process, so more and more (rather than less and less) existing .apk found on Play Store are incompatible with AOSP.
I think the way Google cleverly designed the whole "AOSP vs Android" licensing is way more than a standard freemium model; it's a model in which nobody pays, a part is open-source, and still it's close to impossible to create a forked consumer device that uses AOSP and benefits from the existing ecosystem.
The markets in which AOSP is really making a different (in my experience) is the B2B embedded device market, which is not in direct competition with Android devices, and where AOSP is quickly moving to become the de-facto Linux embedded distro. I work in that field, and I'm grateful to Google for AOSP, as it's really making the whole market progress faster than ever.