If Android is free, How does Google make its profits from the OS?

by Interact SpA – Play innovation

Answer by Robert
Google can’t make money directly off of the sale of the Android OS, like Microsoft (MSFT), because of its Open Source roots, so a billion times zero is still zero. How can Google reach the $ 10 average per handset?

Goldman Sachs’ (GS) James Mitchell sees a number of ways in which Google can, and already has, started to financially reap the benefits of Android’s success. In a note to investors, he states:

* We judge that Android accelerates smartphone and mobile search treatment, boosting Google’s operating income by $ 300 mn, or 2%, per year.
* Use of Android rather than iPhone reduces TAC payments to hardware manufacturers and carriers, which we estimate protects Google’s operating income by $ 500 mn, or 3%, per year.
* Google collects a 30% share from Android market app buys, which we judge ends up life low margin, and we estimate a 40% sharefrom mobile in-app advertising via AdMob.
* Google may maybe use Android to evolve into a virtual telco, as long as a single contact number and popularizing its Internet-based calling services, helped by its stake in Clearwire.

The last point hasn’t been talked about much, but I reckon it deserves some attention. With Google Voice, Google is able to circumvent the telcos and deal directly with customers. If they enable their GoogleTalk VoIP service on telephone lines, they may maybe offer a lower cost voice service to their Android customers, who would only need to pay a carrier for data.

Typical smartphone data plans average around $ 100/month, but boundless mobile data plans are $ 40/month. Google may maybe take that another step further by apt an MVNO and billing their customers directly. Their stake in Clearwire and their relationship with all of the carriers help in this regard.

Overall, Mitchell sees risks to Google’s share price on account of sluggish search growth in Europe; tougher search competition from Microsoft (MSFT), Yahoo!(YHOO) and Apple (AAPL) dominates the mobile Internet ecosystem.

Goldman Sachs maintains a $ 600 price target on Google.

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Image by dalelane

Does google android save the contacts directly on the phone or sd card? I copied my contacts off my sim card, but am curious where on the phone they are stored. Also, how much space does each contact use? I imagine very small.

Thanks!

Answer by allcameras@rocketmail.com
Usually you can choose any sim card sd card or built in

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