• Open business strategy. Google won't do everything itself and it won't be locked into a single distribution partnership. Google will create distribution partnerships with different mobile carriers, unlike Apple, which is wed to AT&T Inc. (NYSE: T) for five years. Through advertising shown on the Google Phone's screen, consumers could pay in different ways -- helping to subsidize the price of the phone itself or the consumer's monthly bill. (Some of that ad revenue could also go to carriers that help market Google's phone in their stores.) Finally, Google won't manufacture the phone itself, but will offer an operating system and applications such as the e-mail and word processing applications it already provides to PC users.

Based on these rumors -- which are admittedly a risky basis for an analysis -- my overall assessment is that the Google Phone is not a significant threat to the iPhone. That's because Google does not excel at the kind of consumer marketing at which Steve Jobs is an industry master.

Moreover, it is unlikely that Google really cares to make the Google Phone an iPhone killer. Google probably views the Google Phone as just another platform on which to sell advertising. By contrast, Apple's strategy suggests that it views the iPhone as a significant source of revenue growth -- and its stock has followed suit.

Nevertheless, the Google Phone open business strategy highlights two iPhone weaknesses: it's expensive and its partnership with AT&T could be an important limiting factor. If Google can exploit these weaknesses to offer consumers a better value, its Google Phone could achieve significant market penetration -- but probably not enough to threaten the iPhone's future sales.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.