Google Android set to topple BlackBerry

GOOGLES ANDROID mobile phone operating system (OS) is set to pip Research in Motion (RIM) to second place in the global market by the end of this year, more than 18 months earlier than expected.

Mobile handset sales increased by 13.8 per cent in the second quarter, thanks to improving economic conditions, according to research published by the technology research analyst Gartner yesterday.

But the recovery in the market as a whole was dwarfed by a 50.5 per cent boom in sales of smartphones. And Android was the main beneficiary. Nokia and the Symbian OS remain overwhelmingly dominant, with respective market shares of 37 per cent and 41 per cent. But the Google OS was by far the fastest-growing in the second quarter, accounting for 17 per cent of the market - compared with just 1.8 per cent in the same quarter of last year, when the software had only recently launched.

Such stellar progress has already catapulted Android to third place in the world league, and just a single percentage point behind RIM's BlackBerry. Google and RIM have been on a collision course ever since the launch of Android, because RIM's major growth opportunity is to expand its business- focused product into the consumer market its rival is targeting. But the Google OS has taken off so rapidly, it is already second in the US league and is expected to oustrip RIM globally by the end of 2010, rather than by 2012, as previously forecast.

"For Android to overtake BlackBerry was always just a question of time," Carolina Milanesi, a research director at Gartner, said. "It is a surprise how quickly Android has become a force in the market."

Android's rapid rise is due to several factors, including the speed with which the software platform has been developed, the number of handset vendors that have backed the new system, and the support from major mobile operators.

The Google OS is not only a threat to RIM. Symbian's dominance is also being chipped away, dropping 10 percentage points from last year's 51 per cent market share. And the Nokia/Symbian combination needs to take a bigger piece of the high-margin, fast-growing smartphone segment of the market. "Nokia and Symbian are where they are because of volume not value, and in the long run that is something they can't afford," Ms Milanesi said.

But the big loser is Microsoft. When smartphones first hit the shops, the top three mobile operating systems were Symbian, RIM and Microsoft. But the giant has seen its market share progressively eaten away, falling to a woeful 5 per cent in the second quarter from 9.3 per cent last year.

The problem is the operating system itself. The software has suffered from the fact it was created by scaling down software designed for full-sized computer screens, and then re-engineered again for use on touch-screen devices.

Microsoft is trying to remedy the situation. The next version of its operating system set for release later this year, has been built from scratch specifically for small, touch-screen devices. But it may be too late.

"If Microsoft had done this a year ago, it would have been fine," Ms Milanesi said. "But now it is coming up with something that catches up with the competition but doesn't stand out."

INDIA SETS DATE FOR RIM SHUTDOWN

The Indian government has set a 31 August deadline to reach a deal over access to BlackBerry customers' secret data, after talks with the company and phone operators in the country yesterday proved "inconclusive".

The home ministry said it would block corporate email and instant messaging services over the devices if no solution is found by the end of this month.

The ultimatum comes after months of argument between the two sides, with the Indian government emboldened to increase its demands in the wake of a deal in the past few days between BlackBerry and the Saudi Arabian government. The Saudis had demanded access to codes used to encrypt the data travelling across BlackBerry's networks and through its servers.

Research in Motion, the Canadian company which owns BlackBerry, and which built its reputation on the security of email traffic between its devices, has not commented on the details of any of the disputes.

India says it needs BlackBerry's co-operation to monitor wireless networks because they can be used by terrorists.