While Google Inc. (Nasdaq: GOOG) is the undisputed leader in Internet search, the company hasn't done much on the wireless front. Then again, it's a tough market to crack (and, by the way, many companies have failed in the effort).

As a result, Google has had to take an innovative strategy - that is, building an open software platform known as Android. In fact, today the company released the software development kit (SDK). There is even a promotion for $10 million in prizes for developers.

To get some perspective on things, I had a chance to interview Frank Dickson, who is a principal at MultiMedia
Intelligence.

As expected, the Google plan has received a lot of attention. But how important is this?

Although Apple, Inc. (Nasdaq: AAPL)'s iPhone has been in vogue, the Google announcement is the most significant announcement in the wireless industry of the year. It is bringing an open platform to the handset to allow for a global ecosystem of development of applications for handsets. These applications are not only client centric applications, but also network centric applications, allowing the handset to essentially become a thin client for some applications.

Let's also not underestimate the advertising possibilities to allow for the replication of many viable Internet business models on the handset.

Mobile can be a tough space to crack. What are the challenges for Google?

Building critical mass is the most significant issue. Metcalfe's law states that the value of a network is proportional to the square of the number of users of the system. The principle applies here. The ecosystem approach
adds value only if the number of users is significant enough to justify development. If it Google does create critical mass, the Gphone would as significant as ISDN.

What might this mean for other software players in the mobile space?

For most application developers, it provides a common and ubiquitous platform that will greatly increase their total available market. It may be unnerving to many of the existing incumbents. However, the Google Android platform does not necessarily imply that smart phone OS is unnecessary. It will be important for the incumbent OS players to integrate the Android functionality while continuing to add value with handset client features.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

BloggingStocks Interview: Google jolts the mobile industry with Android originally appeared on BloggingStocks on Tue, 13 Nov 2007 17:57:00 EST. Please see our terms for use of feeds.