Bloomberg is out with one hell of a long article looking at Google, Android, Microsoft, Yahoo and about any other related subject you can think of around this topic. I provide you below the opening two and last closing paragraphs to give you an idea for the flavor of the story - you should really set aside some time though to digest it. It captures very well the challenges Google faces getting Android to be viable.
On a chilly February morning, Andy Rubin hustles past equation-filled whiteboards in a two-story building on Google Inc.’s Silicon Valley campus.
Rubin, a computer scientist who builds robots for fun, has spent three years in this top-secret sanctum of the Googleplex. He’s putting the final touches on one of the most ambitious and potentially humbling projects the Internet juggernaut has ever undertaken: an operating system for cellular phones that’s designed to give Google the same grip on the mobile Web that it commands in online searches on personal computers…
For all the ambition and ingenuity that Rubin and the rest of the company possess, this hard-charging giant may find that the mobile Internet is one arena where Google may become synonymous with overreaching.


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