Google Wallet is Google’s shot at introducing near field communications to the world. It’s currently available only in the Nexus S, only on Sprint, and only with a Mastercard. Even with Visa’s recent confirmation that it will support Wallet, Google is up against a big challenge in getting its NFC system widely adopted.

Oh, and did I mention that the very people it hopes to embrace Google Wallet are participating in a competing project?

ISIS – a mobile payment joint venture between AT&T, T-Mobile USA, and Verizon – announced today that all of the top Android phone makers will release phones that “implement Isis NFC and technology standards.” HTC, LG, Motorola Mobility, Samsung Mobile, and Sony Ericsson have joined the venture, pledging support as a way to encourage wide adoption of NFC.

Isis will do the very things that Google seeks to popularize with Wallet. The NFC-based technology will enable consumers to securely store their bank information on their phones and make payments by placing the back of the device near a register. It will also store customer reward cards and enable backwards compatibility through DeviceFidelity, so existing smartphone users will be able to use NFC without having to purchase new phones.

That’s obviously not good for Google. Wallet is on its own island now that all the major handset makers, including one Google is trying to purchase, and all the major carriers with the exception of Sprint have agreed upon a standard. And while Wallet has Mastercard now and Visa in the future, Isis already has those credit services, along with American Express and Discover, signed-on. It will be an uphill battle to get massive adoption with so many things stacked against it.

The bright side is that Google is, for now, ahead of the game. Isis is currently in testing in Austin, Texas, while Google and Mastercard have already completed their early testing phases and are rolling out in select markets now. There’s no confirmed date when ISIS will actually arrive in stores and phones held by consumers. Perhaps being first and being able to offer special deals will help Google further encourage adoption. It better move quickly if it hopes to make Android manufacturers see value in supporting its efforts as well. Here are some quotes from those companies in ISIS’s announcement.

“Today’s announcement signals the growing acceptance of NFC technology by some of the world’s leading device maker. At HTC, we see tremendous opportunities for consumers and merchants as we move beyond traditional payments to a future of NFC-enabled mobile commerce.”

- Kouji Kodera, chief product officer, HTC Corporation.

“NFC technology on LG devices will provide consumers with an all-in-one mobile experience that delivers convenience without comprising security or piece of mind. Creating the ideal mobile wallet, LG NFC enabled devices will help change the way consumers shop, pay and save.”

- Jeff Hwang, president, LG Mobile Phones

“NFC is the future of mobile payments and will ensure that transactions are done securely from mobile devices. Through working with Isis as well as the broader Android ecosystem, we look forward to providing consumers with NFC-enabled handsets that make mobile commerce a reality.”

- Christy Wyatt, corporate VP of software & services product management, Motorola Mobility.

“The key to widespread adoption of mobile commerce will be the broad availability of NFC-enabled handsets. Samsung Mobile will be working with Isis and the mobile carriers to ensure NFC-enabled handsets are widely available to consumers.”

- Dale Sohn, president, Samsung Telecommunications America (Samsung Mobile)

“NFC offers consumers the ability to broaden their communication experience beyond the phone, and common standards and best practices are key to a secure and convenient mobile commerce experience. Sony Ericsson is poised to be part of this movement and to drive the development of new, exciting and creative experiences to deliver the most entertaining smartphones.”

- Jan Uddenfeldt, chief technology officer, Sony Ericsson.

Several months ago, I put on my fortune-telling hat and reassured Android fans that OS fragmentation would not doom the system. My points back then were: 1) Android 2.1 would be made available to a wide variety of phones, not just to the Nexus One, and 2) The fragmentation we were seeing was not like Linux, but much more like the rise of Microsoft in the early days of the PC.

On this latter point, I explained that Android’s openness would have dozens of manufacturers clamoring to make hardware to run it, and there would be many, many models to choose from (unlike the “one product” model from Apple).

In a later post, I also forecasted that Android would continue to grow well past the iPhone because of its affordability and more open ecosystem. So how did I do?

• It seems the fragmentation worry has largely disappeared, as 2.1+ versions of Android have become the default, and Google itself has promised to slow down the propagation of new versions. (Note: This is not to minimize the plight of folks stuck with old OS versions. People with 1.5/1.6, get out your pitchforks and march on your carriers!) There are so many models of Android phones now that it’s hard to give a straight answer when I am asked to make a purchase recommendation. (These conversations always end up with me asking questions in return: “Which carrier do you like the best? How much do you have to spend? How important are games to you? How much do you use the camera?”)
• U.S. sales of Android-based phones have officially surpassed those of Apple’s iPhone (and pretty much everyone else, for that matter). It is only a matter of time–perhaps months–before Android outsells RIM.
• Of course, Android remains extremely affordable in comparison to other smartphone platforms. For example, at the time of this writing Amazon has the Vibrant (T-Mobile’s Samsung Galaxy S)—an extremely capable phone with most of the latest Android goodies—on sale for $.01 for new 2-year contracts. The price difference between iPhone apps and equivalent Android apps is starting to fade away, but it is still much cheaper to use the Android Market.

Beyond the fact that I enjoy flaunting my Nostradamus-like skills, I am starting to wonder what could spell the end of the line for the Android train. After all, Nostradamus was really known as the doomsday guy, and many of us enjoy running through worst-case scenarios (I think it makes us feel better). But I have to admit that things get hazy for me here and my old fortune-telling hat does me no good.

Here are my wild guesses for things that could possibly kill Android. Feel free to laugh, criticize, or add your own doomsday items:

1. Google Chrome: What the heck is it? Google promised to roll this thing out for tablet devices a while back, and then nothing happened. Now it is going to come out this year, in just a few months, after a bunch of Android tablets have already been released. Confusing, huh? Let me quote from the Wikipedia entry for “Google Chrome OS”:

“The successive introduction of Android and the arrival of Google Chrome OS, both open source, client-based operating systems, have created some market confusion, especially with Android’s growing success. Microsoft CEO Steve Ballmer accused Google of not being able to make up its mind. Google has downplayed this conflict, suggesting that the two operating systems address different markets, mobile and personal computing, which remain distinct despite the growing convergence of the devices. Co-founder Sergey Brin suggested that the two systems “will likely converge over time.”

Would Google backstab itself? Sure it would, given the right circumstances. What if other companies somehow tied down Android, for example? (Which leads me to…)

2. Lawsuits: Ah, Oracle. And Apple. And whoever else wants to get on the gravy train. Could Android get sued out of existence? As most of you know, Oracle recently sued Android for “knowingly, willfully, and deliberately” infringing on Java intellectual property. Taylor Buley of Forbes magazine thinks that Oracle really just wants to get married to Android in order to get into mobile devices and stay competitive with SAP. Maybe. But maybe it is just willing to drag down anything that floats in order to float a little bit higher.
3. Nuclear War and/or Zombie Apocalypse: Well, isn’t that how all doomsday scenarios end up? A few humans survive, Mad Max-style. They cobble together lawnmowers and motorcycles and attack the bad guys (and each other) with strange weapons. Eventually, someone figures out how to get a computer running and the human race starts over.

I wonder, what OS would one use to start anew?

Advertising companies often release metrics data showing how platforms are performing. While ad impressions aren’t exactly the most ideal way to measure OS strength, they have been useful in gauging how well platforms have progressed in recent history.

The latest report from Millennial Media reveals that Android has had significant growth in the past year, something we’ve seen in other reports recently. The Mobile Mix Device Index for July 2010 shows that Android is present on six of the Top 20 Mobile phones; the Motorola Droid leads the pack with 5% of impressions within the Millennial ad network.

Android, accounting for 19 percent of impressions, surpassed RIM (16%) for the #2 spot within the network. Apple’s iOS still leads with 55 percent.

However, Android is obviously the hot platform thanks to an influx of popular devices that have triggered growth that BlackBerry and iOS cannot match. Both operating systems are made by company while Android devices are made by an alliance of manufacturers. Android ad requests grew 690 percent since January, far outpacing the requests of iOS (15%) and RIM (66%).

Android is not the global leader in the mobile market but it’s made a serious dent in the competition. Here’s some more information gleamed from the report. Read the Millennial Media July 2010 report in full here.

• 100% of apps that appear on multiple platforms are available on iOS. Android is 2nd with 75%
• Motorola and HTC are the top Android producers
• The most popular app categories are Games

“After all, it’s kind of convenient that Android gained 4.3 percent and WinMo lost about the same, isn’t it?” –Chris Ziegler, Engadget

There is a big problem with the way these figures have been presented so far. Every stock market (and therefore almost every company) on the planet focuses on a different number to measure trends in the market, and it is not “point changes”. The most important thing to most folks is the percentage change in values over time.

Let me illustrate. Here is the data as it was presented last week:

Pretty small numbers–no one gains or loses more than 5%, right? The chart for this version of the numbers looks pretty good for Android:

But let’s add the missing column–”percentage change”–to the original data, and see if the numbers still stay in the single digits.

Holy bleep. Here is the resulting chart for the new data in the last column:

Hmmm. This looks really, really good for Android, and not so good for anyone else except for RIM. RIM should still feel positive because it already had more market share than anyone else, and it nearly quadrupled the iPhone’s growth over the past year. If you work for Google’s Android division, it might be too early to break out the champagne, but this is a truly amazing trend. Of course, keep in mind the larger your market share gets, the harder it will be to see these kinds of gains. Apple is obviously suffering from its long-standing marriage to AT&T, and Microsoft is hoping that its new OS will plug the leaking dike this summer. Finally, if you work at Palm, you should be panicking.

In fact, one group of people may have noticed these numbers and seen them for what they really were. Investors abandoned Palm’s stock in droves at the end of last week, a perfectly reasonable response to a company that just reported a 27% decrease in its market share over the past year.

1. Apple’s position is about strict control; Google’s is about freedom of access

“Apple believes that devices like smartphones and tablets should have tightly controlled, proprietary standards and that customers should take advantage of services on those gadgets with applications downloaded from Apple’s own App Store.

Google, on the other hand, wants smartphones to have open, nonproprietary platforms so users can freely roam the Web for apps that work on many devices. Google has long feared that rivals like Microsoft or Apple or wireless carriers like Verizon could block access to its services on devices like smartphones, which could soon eclipse computers as the primary gateway to the Web. Google’s promotion of Android is, essentially, an effort to control its destiny in the mobile world.”

You can’t say it any better than that. Some of the chief attractions of Android (for many of us) are that you can: 1) develop and distribute any application you like, and 2) install any application you like on the phone that you paid for.

2. Someone else agrees that Google’s Android = Microsoft’s ascension in the operating system market

“Mitch Kapor, the founder of Lotus Development and now a tech investor, describes [the] infighting as “old wine in a new bottle,” and reminiscent of many past corporate battles in Silicon Valley. He sees the old dynamics between Apple and Microsoft being recycled, with Apple still trying to control every aspect of the user experience, and Google, like Microsoft before it, working with multiple partners to flood the market with a large number of devices.

While mobile phone developers favor the iPhone for now, “they are all racing ahead to develop for Android, too,” Mr. Kapor says. “Tight control helps in the beginning, but it tends to choke things in the long term.””

As I said in my previous article, this situation is a lot more like Apple vs. Microsoft in the early days than it is like Linux’s failure to achieve adoption in the desktop PC market. What will be interesting is how much history will repeat itself in this new realm of mobile computing. Apple is in a much stronger position now, and there is always the chance that Steve Jobs will decide to loosen the reins this time around. My magic 8 ball says that it is “highly unlikely” that Jobs will change his ways.

3. Yes, Steve Jobs did threaten to sue over multitouch

“At one particularly heated meeting in 2008 on Google’s campus, Mr. Jobs angrily told Google executives that if they deployed a version of multitouch — the popular iPhone feature that allows users to control their devices with flicks of their fingers — he would sue. Two people briefed on the meeting described it as “fierce” and “heated.””

Remember all those articles speculating why multitouch wasn’t available on Android phones? Many of us found it even more confusing when developers showed that it could be made to work on a G1 (and became a standard feature on aftermarket ROMs). Then, more recently, some newer phones had multitouch while others (like the Droid) did not. It seems the schizophrenia was all related to these threats of litigation. Obviously, Google decided that multitouch was OK for its flagship phone, and interestingly, Apple’s lawsuit against HTC doesn’t seem to mention it as one of the purportedly patented features.

4. Apple loves Microsoft?

“There is wide speculation in technology circles that Apple is preparing to give Google a public black eye: by making Microsoft’s offering, Bing, the preferred search engine on the iPad, and perhaps even on the iPhone.”

Yes, Apple may run into its fiercest rival’s arms to embrace Bing in order to replace Google as the default search engine. Wow. Perhaps the most interesting thing about this last point is how competition evolves over time. Microsoft won the operating system wars in terms of global dominance, but Apple forged a strong niche, survived, and even thrived as the “coolest kid in the room.” Think BMW: a superbly engineered, expensive machine. Could the same happen when it comes to iPhone and Android? What will happen to the tablet market when the iPad is launched and a dozen Android competitors join the fray? Stay tuned.

Andy Rubin claims that the Nexus One is an opportunity to broaden the availability of handsets running Android. News flash, Mr. Rubin: plenty of Android handsets are available, and plenty more are in the works for 2010. Not to mention that HTC–the maker of the Nexus One–already has many of their own handsets running Android anyway. Why does the Nexus One need to be sold by Google?

Think about it. There are many potential drawbacks to creating an operating system for the Open Handset Alliance, working with various vendors to get the latest versions of your operating system on their hardware and their networks (Motorola, Verizon, T-Mobile, etc), and then turning around and selling the latest and greatest version of hardware and software yourself. (Yes, Engadget thinks the Droid is better than the Nexus, and yes, Android 2.1 is coming for others, but that’s missing the point.)

I can only speculate that this is some sort of middle step for Google. One popular rumor is that Google wants to become its own carrier. Maybe they do plan to offer a service that would eliminate cell phone carriers somehow. I can’t imagine that T-Mobile, Verizon, Sprint, and Vodaphone would like that very much.

Another idea is that Google wants to emulate Apple: become a software and hardware vendor and make huge profits with flashy, high-end gear. This would require Google to buy a company like HTC (which may not even be possible), and again, would surely annoy the other hardware makers in the “Alliance.”

You don’t have to look very far to see that Google is OK with blowing up markets for other companies. Just check out Google Navigation and its impact for GPS navigation system vendors for a recent example. But Google should step lightly here. Partners don’t like to be stabbed in the back, and they can certainly impact the profitability and viability of Android in the long run. Of course, it may just be that I don’t understand what the plan is to begin with.

The Android team released a preview build of the SDK, so developers can ensure that their apps will work on the new version of Android. The latest build also offers the following features:

• “Refinement of all core UI elements” – (the look/feel of Android will improve across the board)
• Faster camera, GPS, scrolling, and browser
• On-screen keyboard and auto-correct, auto-fill, and user dictionaries
• Various forms of Live folders
• Video Recording
• Stereo Bluetooth
• Search for text on a page
• Copy and paste from the web
• Google Talk status appears in contacts
• Framework to support Widgets and Live Folders

There’s quite a bit of new features expected from the Cupcake build. Aside from the obvious big-ticket features like video recording and a soft keyboard, the long list of improvements, enhancements, and small-detail features really has me excited again (even though I’m sure it will be weeks before we see any of this).

[Android Developers Blog via Crunch]

Naturally, Google VP Rich Miner fired back that Symbian is actually the un-open, open platform. Using the classic, “Oh, yeah, well you’re worse” debate technique, Miner pointed out that the Symbian source code isn’t available to non-members of its Symbian Foundation that requires $1,500 annual fees, which effectively pushes out many individual developers.

Both Android and Symbian have some stipulations that aren’t in the best interest of “open,” but it seems counterproductive for the two companies to takeout measuring sticks to see which is more open than the other. Maybe they could use a refresher course on what is open-source.

According to the Open Source Initiative, an open source project meets the following criteria.

1. There should be no intentional secrets, which ensures that flaws can be fixed appropriately
2. The standard must be freely and publicly available under royalty free terms at reasonable and non-discriminatory cost
3. All patents essential to use must be royalty-free
4. There must be no requirements that conform use
5. There must not be any essential technology that fails to meet the criteria of the open standards.

Are you happy Google and Symbian? Neither one of you has been 100% faithful to the definition, but what does that matter? Google’s Android follows the basic premise of open source by making the code available within reasonable means and allowing modifications of that code. There’s definitely room for improvement, but considering the restrictions Symbian has in place, glass houses, stones, and something about throwing. You know the phrase, Mr. Williams, so be mindful of it.

That means anyone who has purchased a developer T-Mobile G1 or is a Google employee who received a dev G1 phone from Google as a holiday bonus may be shut out from certain paid apps.

The Google employee states that this is a recent change. I hope it’s one that will be rescinded.

One would think that Google and other Open Handset Alliance members wouldn’t want to shut out the early adopters of their operating system who have waited patiently for paid apps. Why reward their patience with exclusion?

Security seems to be the most likely factor. Google probably fears that a developer phone could make it easier to pirate apps, even at the expense of honest people who just want more options. Is this the “Open” that Android’s Handset Alliance was supposed to offer?

[Android Market Help Forum]

Broadcom touts its combo chip as an efficient solution for future Android phone designs that include the communication tools cell phone subscribers increasingly demand. Integrating different technologies like Wi-Fi, Bluetooth, and FM will:

• Decrease power consumption (increased battery life, anyone?)
• Reduce board space (frees up more design options for manufacturers)
• Cut production costs

The T-Mobile G1/HTC Dream is currently the only Android phone for sale and uses different components to provide Bluetooth and Wi-Fi functionality. Both features also contribute to the G1′s reputation as a mobile phone with a relatively short battery life. Broadcom expects its combo chip to improve the way newer Android-powered phones manage these technologies.

“Two of the most exciting trends in the handset industry are the growing popularity of Android and the transition to combo chips for connectivity,” said Broadcom executive Chris Bergey.

“As a founding member of the Open Handset Alliance, we are committed to advancing the Android platform by contributing our software and facilitating greater access to our combination chips in the open source community. We expect a plethora of products and applications to evolve from the connected Android platform in the not-so-distant future.”