Google opens "retaliation" mode China's mobile phone manufacturers influence geometry?
Issue Time:2018-10-30
After receiving the European Commission's ticket, Google finally launched the charging model at the same time as the appeal. According to Google's official blog, on October 29, 2018, Android phones and tablets launched in the European Economic Area (EEA, including 31 countries) will gradually adopt new charging agreements. It is reported that the licensing fee for a device can be up to $40.

There are two key points in the new agreement. First, if you use Google Search and Chrome to download Google's various application suites, you will need to pay an authorization fee for each device. However, if the vendor is willing to pre-install Google Search and Chrome (not exclusive), Google will offer a new commercial agreement, which means that pre-installed vendors still have revenue.

Second, Android will remain free and open source. Previously for the punishment listed in the EU, Google once said that it is possible to charge for the Android system. It seems that Google is not willing to affect the ecology of the Android operating system because of the charges.

Next, Google will spend several months coordinating new fee agreements with partners. At present, it is seen that the main affected companies are mobile phone and tablet manufacturers with European operations, and the markets in China and other regions are not affected.

On October 29, Liu Xingliang, president of DCCI Internet Research Institute, told the 21st Century Business Herald: "For domestic Android users, there is no impact at all. Because Android is still free, Google is the application suite (Play Store, Search) , maps, mailboxes, etc.) to charge. These Chinese users do not have to."

Google's "counterattack"

In July of this year, Google received a 4.3 million euro (about 5 billion US dollars) sky-high price ticket. The EU believes that Google has a monopolistic behavior based on Android, such as paying manufacturers and operators, making Google search an exclusive search tool on products. Google requires manufacturers to pre-install Google search and Chrome browsers on Android devices, and Google does not allow manufacturers to sell mobile devices powered by competitors' Android branch systems.

Google search for Chrome is an important source of profit for Google, and it also provides free support for free open source such as Android. In accordance with EU requirements, Google may not require mobile phone manufacturers to pre-install software. In order to make up for the gains, Google decided to charge software license fees in the European Economic Area.

In terms of specific charging measures, according to the report of The Verge, the fees in the EU countries will be divided into three levels, the highest cost is distributed in the UK, Sweden, Germany, Norway and the Netherlands. According to pricing documents, devices with pixel densities above 500ppi in these countries will have to pay $40 to license Google's suite of applications. 400 to 500 ppi devices will pay $20, while devices below 400 ppi will only cost $10. In some countries and regions, for low-end phones, the cost per device can be as low as $2.50, depending on the country and device type.

So, what impact does charging have on Google's ecosystem? The Android ecosystem can be easily divided into Android OS, Google services, and Google Play. Through Google Play, Google integrates the app ecosystem on Android, including search products such as Google Chrome and YouTube. Of course, device manufacturers can also choose not to use Google's application services, but the number of users of Youtube, Gmail, and Chrome is very large and it is difficult to avoid them completely. However, due to the new charging system, the terms of service will change and the user system relationship will be updated. Perhaps paid merchants can get more services, and Google's service methods will also be differentiated.

On the other hand, Google will greet more competitors on the service and application level. Although it competes with Android, other service providers can make their own app stores. For example, China does it themselves. From the upper application, mailboxes and browsers have alternatives, and some new competition will be introduced in these aspects.

Mobile phone manufacturers

In addition to the impact of Google's ecology, many commentators believe that mobile phone manufacturers will suffer the price increase. However, some insiders said that mobile phone manufacturers may not actually need to bear the cost, because Google also provides a separate agreement to pay for some or all of the companies that choose to install Chrome and Google search on their devices. License fee. Suppose an Android device has an average license fee of $20, Google has to pay $5 billion in fines, and it needs 250 million units to earn back.

From the data of the European mobile phone market, Samsung, Apple and Huawei have contracted the top three sales, and various mobile phone manufacturers are currently watching their changes.

According to the ranking of European smartphone market shipments released by research institute Canalys in the first quarter of 2018, Samsung's shipments were 15.2 million units, with a market share of 33.1%, ranking first, but shipments fell by 15.4% year-on-year. %; Apple ranked second, with shipments reaching 10.2 million units, down 5.4% year-on-year, with a market share of 22%; Huawei ranked third with 7.4 million units shipped, up 38.6% year-on-year, with market share It has grown to 16.1%. The fourth and fifth places are Xiaomi and Nokia, respectively, with a market share of 5.3% and 3.5%.

Google’s charging terms are currently only implemented in the European Economic Area, and have little impact on Chinese domestic mobile phone companies. On the 29th of October, Novo Consulting CEO Li Rui told the 21st Century Business Herald: "This is a beginning, and it has no effect on domestic brands and the Chinese market. In fact, it is difficult for Google to restrict domestic brands, but only through the market side, but I don't recognize that Google can restrict the products activated in China. The license price is still normal. In fact, the most alarming mobile phone is the increase in component costs due to political and macroeconomic conditions."

From the perspective of the proportion of mobile phone software costs, Li Rui said: "The cost of the OS/UI level is difficult to talk about, depending on the brand-related R&D investment, it is difficult to convert to each mobile phone. The app at the app level will also be invested. A third-party app with a revenue, a big brand of a mobile phone has an income of about 100-300 yuan." From this point of view, for high-end mobile phones, the license fee of 40 dollars, less than 300 yuan is actually not high, low. The mobile phone may be affected, but as mentioned earlier, Google will also rate mobile phone charges.

Since the beginning of this year, Huawei, OPPO, vivo, Xiaomi and other mobile phone manufacturers have actively expanded the European market. Among them, Huawei has the deepest foundation in Europe. “Android charging will have a certain impact on product pricing, when it is pricing itself and rising overseas. Huawei's impact will not be large, and the licensing fee is nothing compared to the growing overseas marketing expenses." Li Rui said.

Article source: 21 economic network

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