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    HomeInsightsGoogle chief doesn’t play dumb

    Google chief doesn’t play dumb

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    Eric Schmidt tells MWC delegates he doesn’t want to turn mobile operators into ‘dumb’ data pipes

    Eric Schmidt, Google CEO, used a Q&A in his Tuesday keynote presentation to try and reassure mobile operators that he was not out to turn their networks into commodity pipes, where Google and other third parties grab all the non-traffic revenue.  “We need advanced networks,” he said, “that deal with security, dynamic signaling, and load balancing.”

    Schmidt argued that the mobile industry had reached an important milestone where the computing power of mobile phones, attractive services and capable networks had converged. He also added that Google was driving network traffic, which actually benefits operators.

    Mobile operators generally view Google with suspicion, invariably arguing that the online search and advertising giant takes advantage of their network assets (on which they have invested heavily) with so-called ‘over-the-top’ services: operators bear the network costs but still don’t see any of Google’s revenue. The launch of Google Voice and Google Apps (Google’s online office software) is further evidence, they say, of Google taking advantage. In the case of Google Voice, a VoIP application, a case is often made that Google is “stealing” mobile operator voice revenue.

    Schmidt naturally believes, however, that the cloud (of which Google is an arch exponent) is where the next big opportunity is for mobile. “If you don’t use the power of the cloud you will fail,” he said.

    Again, the business models are still fuzzy surrounding mobile operators role in the cloud, and it remains to be seen how successful they could be in monetizing the advanced network features that Schmidt speaks of.

    The Google Chief also updated the MWC audience on Android, its mobile OS platform. Schmidt says Android now runs on 26 different devices, and handset manufacturers are selling more than 60,000 each day.