The fragmentation of Android is very real and very problematic for end users, developers, mobile operators, device manufacturers, and Google. However fragmentation does not mean Android is going to “die” or “fail” as some seem to think.

On the contrary I think we can count on Android playing a significant role in our world for a long, long time. I also am confident that Google has already lost control of Android and has zero chance of regaining control. This post explains why I’m so confident about this.

TL;DR Next time you say/hear “fragmentation sucks/is not a problem” consider for whom.

Fragmentation will cause Android to continue to grow.

Google has lost control of Android due to fragmentation.

You’ll, hopefully, note that I intentionally separate Android from Google. Repeat after me: Android is not Google and Google is not Android. Android has become something that is independent of Google (or anyone else, for that matter).

Let’s break down this whole mobile platform fragmentation thing. This weekend Jon Evans of Techcrunch apologized to MG Siegler for disagreeing about the relative quality of the Android and iOS developer tools. In that post, Jon argued that Android device fragmentation is relatively minor for developers, but OS fragmentation is a real problem:

Android’s fragmentation has become a giant millstone for Android app development, leaving it worryingly behind its iOS equivalent. It’s not the panoply of screen sizes and formats; the Android layout engine is actually quite good at minimizing that annoyance. It’s not the frequent instances of completely different visual behavior on two phones running exactly the same version of Android; again, annoying, but relatively minor. Device fragmentation is just an irritation. OS fragmentation, though, is an utter disaster. – Jon Evans

Jon points out two of the 5 axes of fragmentation: Device & OS. The other three are User Interface, Marketplace, and Services.

(Update: I expanded on the following taxonomy in a guest post for LockerGnome on Oct 22, 2012. Go here to read the updated version.)

The 5 Axes of Mobile Platform Fragmentation

User Interface

Device

Operating System

Marketplace

Service

For a mobile platform, a different degree of fragmentation can exist along each of these axes. For example, Apple’s iOS platform has almost no fragmentation along the Marketplace axis because Apple has been so hardcore about ensuring that the iTunes marketplace is the only marketplace supported. A relatively small amount of fragmentation on the User Interface axis exists because Apple has been extremely consistent with UI. Likewise there is a bit of device fragmentation in iOS due to different generations of iPhones having different hardware capabilities (such as a front facing camera).

The fragmentation of Android is severe, across all of these axes, regardless of how Eric Schmidt tries to spin it. And because of the complexity of the mobile ecosystem (and the other ecosystems Android is part of) the effect is more multiplicative than additive.

Revisiting the Mobile Ecosystem

You’ll recall in my “Windows Phone is Superior; Why Hasn’t it Taken Off?” post I broke the mobile ecosystem into its market sides: Developers, Users, Carriers, Device Manufacturers, and OS Providers (see how I put Developers first? Wouldn’t want someone to think I don’t believe they are important, for heaven’s sake). As I pointed out, the mobile ecosystem is highly complex and, due to the desires & behaviors of the various sides, not efficient. There is not enough clean value exchange between several sides of the market and too much friction.

But regardless of how virtuous the virtuous cycles within the mobile ecosystem are, it is clear each side of the ecosystem is impacted differently by each fragmentation axis. In some cases, some combinations of fragmentation/market side are actually positive (one could use the word “diversity” instead of fragmentation in these cases). In many other cases fragmentation is bad. Bad with a capital B. In still other cases fragmentation can be a double-edged sword for a player on one side of the market.

Examples of positive fragmentation (diversity):

Market Side Axis of Fragmentation Positive value Users Device Some users like physical keyboards. Some don’t. Some like pink. Some don’t. Carriers User Interface Carriers want to differentiate from competitors, and differentiate within the products they carry. Carriers want their brands to pervade the experience. Device Manufacturers Service Device manufacturers want higher margins & recurring revenue that can come from providing services such as search & location.

Examples of negative fragmentation:

Market Side Axis of Fragmentation Negative value Developers OS Developers want to be able to reach as many end users as possible. Lots of OS variants means either investing in more dev/test or limiting market. Carriers User Interface Each new UI requires carrier’s customization to have to be ported. Raises costs. (Note this is an example of fragmentation being a double edged sword in some cases). Users Marketplace End users want to be able to discover and acquire apps from as few places as possible.

Any commentary about fragmentation either needs to include all market sides and all axis or be very specific on which aspect is being discussed. Jon’s article above is clearly about developers. You can obviously take the tables above and expand them to cover the entire 5 x 6 matrix. But even if you did, and tried to document all 60 rows, you’d quickly discover the following:

Not all players on a market side are the same; they differ in the value they provide and the value they expect to extract from others . This is most pronounced on the OS providers side, and this gets to the core of the point of this post:

Google lost control of Android a long time ago and nothing it does will allow it to regain control. In fact, almost anything I tries will simply increase fragmentation along most fragmentation axes.

Remember we are talking about a complex multi-sided market (6 sides) with high-impedance between key sides of the market (see my “superior” post). The OS providers side of the market is dominated by Apple and Google. Microsoft is serious about being a 3rd player, and I believe they will push, push, push until they are. There’s also RIM and a few others, but it’s safe to ignore them here (Cue Scoble: “Charlie says Bada is dead”).

OS Providers Perspectives

Apple – Makes the vast majority of its money, by getting paid ~$150 up front from mobile operators per iPhone sold. The high-margin iPhone business will becomes a smaller relative portion of the overall Apple business. They are motivated to keep propping up this high-margin business as long as possible and to start leveraging their significant market share to grow revenue from services. Apple has caused an imbalance in the ecosystem by cutting 3rd parties out of the device manufacturer side of the market.

– Makes the vast majority of its money, by getting paid ~$150 up front from mobile operators per iPhone sold. The high-margin iPhone business will becomes a smaller relative portion of the overall Apple business. They are motivated to keep propping up this high-margin business as long as possible and to start leveraging their significant market share to grow revenue from services. Apple has caused an imbalance in the ecosystem by cutting 3rd parties out of the device manufacturer side of the market. Google – Invested in Android believing they could own mobile search like they own web search by tying Android to Google search. At one point believed they could disrupt the carriers(but got slapped back, hard). Now, their desire to continue to invest in Android is still about search, but also about owning a social graph (via Google+) and being pissed as hell that Apple is so successful. Google is deeply frustrated with the fragmentation of Android and has been trying all sorts of tactics to rein it in.

– Invested in Android believing they could own mobile search like they own web search by tying Android to Google search. At one point believed they could disrupt the carriers(but got slapped back, hard). Now, their desire to continue to invest in Android is still about search, but also about owning a social graph (via Google+) and being pissed as hell that Apple is so successful. Google is deeply frustrated with the fragmentation of Android and has been trying all sorts of tactics to rein it in. Microsoft – Feels stuck between the Apple & Google models. Going it alone, ala Apple, is not possible due to the fact that no carrier will ever let anyone else do what Apple did to them again. The Google model is way too similar to what the old Windows Mobile was like (irony much?). Microsoft sees mobile as a means to an end (as Google does). But the end is different. Where Google has only really one service it can monetize via mobile, Microsoft has several (Office, Xbox LIVE, etc.). In addition Microsoft has a cash cow that is at serious risk due to Microsoft not being a key player in mobile: Windows. Microsoft must be relevant in mobile or Windows revenues will plummet because everything is going mobile. I think Microsoft really likes the fact it generates revenue from Android, but I doubt it has that much impact on the bottom line.

Only Apple directly profits from being an OS provider in the mobile ecosystem. For Google it is a cost center. Apple is the only OS provider that leaves device manufacturers out in the cold.

Smartphone device manufacturers now have two choices: Android or Windows Phone 7. As I noted in my “superior” post, Microsoft’s strategy of focusing on the quality of the user experience (which tends to minimize fragmentation along most axis) is counter to what device manufactures really want. I am glad Microsoft is following this strategy; it is pretty much the only strategy that makes sense given the hole they dug with Windows Mobile. But this strategy does cause friction between Microsoft and device manufacturers/carriers when ideally you’d not want friction.

Google, on the other hand, gave device manufacturers exactly what they wanted with Android: Extreme flexibility and an open source license. That model is like crack cocaine for the likes of Samsung and HTC. They have had years to get addicted to it and, from their perspective (selling boatloads of devices) it’s working just dandy for them.

The carriers tend to encourage the device manufacturers here. They demand a variety of devices. They demand differentiation from their competitors. They control the marketing money spent on advertising. When Verizon writes something like $10B+ worth of checks every year for devices, who do you think they write them to? Hint: not Google.

Google’s Options

Google has some tactics that it might try (is trying) to use to rein in fragmentation. None of these will have a significant impact; in fact, most will make fragmentation worse.

Investing in the Nexus brand. Nexus is Google’s “pure” Android play. The idea is a phone with a more rigidly defined user experience, more consistent hardware, the latest OS with a consistent upgrade policy, a single marketplace, and consistent (Google endorsed) services. I love this strategy from an end-user’s perspective. Nexus phones will sell fairly well. But the numbers will pale in comparison to the non-Nexus phones sold. But Nexus will only be “fairly” successful because it is counter to what the carriers want and every dollar Google spends on advertising it incents the device manufactures and carriers to spend more on advertising their differentiated products. Nexus actually worsens fragmentation along most axes by introducing yet another “Android model” into the mix.

Nexus is Google’s “pure” Android play. The idea is a phone with a more rigidly defined user experience, more consistent hardware, the latest OS with a consistent upgrade policy, a single marketplace, and consistent (Google endorsed) services. I love this strategy from an end-user’s perspective. Nexus phones will sell fairly well. But the numbers will pale in comparison to the non-Nexus phones sold. But Nexus will only be “fairly” successful because it is counter to what the carriers want and every dollar Google spends on advertising it incents the device manufactures and carriers to spend more on advertising their differentiated products. Nexus actually worsens fragmentation along most axes by introducing yet another “Android model” into the mix. Wishing Everyone Will Upgrade . This actually seems to be Google’s primary tactic. As Eric Schmidt said last week: ‘With Android, Google’s “core strategy” is to get everyone on Ice Cream Sandwich, the latest version of the platform.’ Google is trying to do this two ways:

. This actually seems to be Google’s primary tactic. As Eric Schmidt said last week: ‘With Android, Google’s “core strategy” is to get everyone on Ice Cream Sandwich, the latest version of the platform.’ Google is trying to do this two ways: Holding Back Access to Google Services . “Follow our rules or you can’t use Google Search”. This just pisses Google’s partners off and smells like anti-trust. Not that it matters, because Google can’t really do this because there are enough reasonable alternatives to Google’s services now. In addition, the battle of the social graph is causing Google to push Google+ everywhere. What strategy tax at Google do you think will trump the other: Android consistency or Google+ everywhere?

. “Follow our rules or you can’t use Google Search”. This just pisses Google’s partners off and smells like anti-trust. Not that it matters, because Google can’t really do this because there are enough reasonable alternatives to Google’s services now. In addition, the battle of the social graph is causing Google to push Google+ everywhere. What strategy tax at Google do you think will trump the other: Android consistency or Google+ everywhere? Holding Back Access to the Latest Version of Android. “Follow our rules or you don’t get Ice Cream Sandwich, etc…”. Uh, it’s open source. Fork. More fragmentation. Simply. Will. Not. Work.

None of these tactics will work, primarily because none of the other sides of the market have any motivation to help (other than end users, who would benefit, but consumers don’t really have enough power). Secondarily, these tactics won’t work because Android has already been so fragmented and such a market success (in terms of units).

The early fragmentation of Android (across all axes) was the proverbial camel’s nose under the tent.

Buying Motorola Mobility, under-investing curating the marketplace, redesigning the user interface every release, not forcing the device manufacturers/carriers to consistently upgrade, and Google’s monopolistic behavior with search got the camel into the tent up to its first hump.

Android’s massive unit growth mean the camel is now already IN the tent. Android has become so successful that Google has lost control of it. And this, in turn, means Android, as a brand, will have a significantly diminished value over time.

Oh, and if after reading the above tome, you still don’t agree. Consider this article about television. Remember, Android is not just about mobile…

UPDATE: I wrote a follow-up post for Lockergnome. Read it here.

I’d love to hear your comments. Keep it clean…