ForbesOnTech

What's it Going to be; Google's Android Platform or Apple's iPhone?

Over the weekend, Om Malik commented on a recent piece in the Wall Street Journal on delays in Google’s Android smart phone operating system here. Om’s observation is “welcome to phone business, Google.”

The article quotes Google’s Andy Rubin on some of the tribulations Google has faced in getting Android ready for release with forthcoming TMobile smart phones. 

What Om missed in his post however, is this: Andy Rubin is one of the few Valley executives—other than Apple’s Steve Jobs-- who has real experience dealing with cellular carriers. Before starting Android software (which was acquired by Google), Rubin co founded Danger Research, which developed the Sidekick smart phone platform which was sold for use by TMobile on its network.

I believe Google’s Android platform has the potential to throw a giant monkey wrench in Apple’s plans and mid-term success for its iPhone. Unlike Apple, which is relying heavily on the Kleiner Perkins’ administered iFund to attract developers, Google has the workforce, wherewithal and pocket book to lure top-notched developers to Android. And it can do this without the intrusive over watch of a third-party venture capital firm.

Let’s see which platform will consumers vote for with their pocket books:  Android developed by a company that’s synonymous with the internet; or the iPhone, which will be two or three years old when the Android steam roller picks up momentum.

I can hardly wait to see how this tussle shakes out. I think it’s going to be fun to watch.—Jim Forbes 06./23/2008.

IFund Could Also Fuel Android and Java Brew App Development

If you think Kleiner Perkins Caufield &Byers’ (KPCB) iFund is just an end run by Apple to keep developers and new high profile mobile Internet applications off other platforms, you’re wrong, suggests Matt Murphy, the KPCB partner in Menlo Park, CA charged with running the $100 million dollar investment pool.

            Murphy makes it clear that while Kleiner Perkins is strongly behind Apple’s iPhone as “the platform of choice” for the mobile Internet, “There are no conditions whatsoever” that locks an iFund developer to the Apple iPhone,” Mr. Murphy notes. Moreover, “We fully expect companies to support other (smart phone) platforms to address an even larger user base.”
            One of the other mobile internet platforms expected to appear in the us domestic market in the coming months is Google’s Android operating system, which could make it’s appearance on handsets sold by US cell network operators by the end of this year. Android and Java Brew are two of the smart phone operating systems that iFund developers could also build applications for Mr.Murphy says.

“We just believe that developers will find the best platform and the most advanced user base on the iPhone, he adds.

Although the priority of KPCB’s iFund is to invest in standalone applications, it’s large enough that it’s mere presence could create the leverage needed to drive the development of new mobile Internet applications and a new generation of smart phones that are designed from the outset for use with voice and internet connectivity.—Jim Forbes 03/28/2008

Q&A with Kleiner Perkins' Matt Murphy on the iFund

I've spent several days now thinking about Kleiner Perkins Caufield & Byers' and Apple Inc's attempts to bolster the iPhone with a $100
million venture fund.
    First, I believe iFund could legitimize the iPhone in virtually all segments of the market, taking it far beyond the realm of the so-called "Apple Faithful" who wait in line for every new Apple product.
    Second, the overall effect of the iFund will extend far beyond iPhone
platform and help make the mobile Internet a reality not only for
Apple iPhone users s, but for all mobile phone users.
    Finally, the iFund is a much different proposition than KPCB's
previous platform-based venture effort. The Java Fund.  Although both
the iFund and the Java Fund initially have the same value, $100
million, the first fund was subject to the forces of several large
corporate entities, including  IBM and Sun Microsystems. The iFund was
raised solely by Kleiner Perkins and is only concerned with one large
corporate partner, Apple Inc.

If you want to get to the core of the iFund, there's only one person
to as questions of; Kleiner Perkins Caufield & Byers partner Matt Murphy, an
eight-year veteran of the firm and a member of KPCB's Information
Technology investment team. The following are some of the questions I
asked Matt Murphy and his replies:
ForbesonTech: What are some of the differences between the iFund and
the Java Fund?
Matt Murphy: The Java Fund had many different strategic partners. The
iFund is focused on one partner and it's all KPCB's money.
ForbesonTech: Does Apple have to "approve" iFund investments?
Matt Murphy: Apple doesn't have to approve anyone, except when the
investment is strategically aligned with its goals/
ForbesonTech: Will Apple help iFund companies with cooperative
marketing programs and funds?
Matt Murphy: Apple will control internal editorial and marketing, at
Apple stores and on its website, but I haven’t heard anything yet on
whether or not Apple will establish cooperative marketing programs
for iFund companies.
ForbesonTech: Have there been any surprises since Klein Perkins
announced the iFund?
Matt Murphy: The response to the fund has been great. We’ve heard from startups, establiushed companies and other VC firms.

The biggest surprise has been the volume. Internally we had a bet about what the response would be in the first 30 days. The high end number was exceeded in 36 hours and now the number of companies we’ve heard from is 3x that number.

ForbesonTech: What was the number?

Matt Murphy:  (silence)

ForbesonTech: any other surprises?

Matt Murphy: the number of healthcare and healthcare applications people would like to develop for the iPhone was more than we imagined.

ForbesonTech: Are there are other types of applications you hope to see:

Matt Murphy:            Location-based shopping –which includes delivering local coupons—and Mcommerce are things we’ve heard about., GPS Shopping (and related services) are things we’ve been pitched with.

            We’re looking for businesses that will be stand-alone applications, not small widgets.

            The iFund is about funding high tier mobile Internet applications.

ForbesonTech: Do you think current pricing models for wireless Internet connectivity will be a significant problem gating the success of wireless Internet-based applications?

Matt Murphy: Mobile Internet pricing is an issue, as is consumer awareness of the mobile Internet.

            Cell network operators are moving to adjust the pricing of mobile Internet connectivity and some are looking to offer free over-the-weekend trials of Mobile Internet (connections).When they do they report 10X spikes in wireless Internet usage.

            Iphone (internet) connectivity is high, 95 percent of all iPhone users use Internet connectivity, compared to only 20 percent with other (brands) of cell phones.

ForbesonTech: What’s your take on Google’s Android mobile phone operating system?

Matt Murphy: there’s a great spot in the (smart phone) ecosystem for Android and JavaBrew operating systems.

Stay tuned, the iPhone applications are coming and when they begin trickling in I think we’ll see it’s a tide that raises all boats and which drives mobile internet connectivity, creating an ocean of where persistent connectivity is expected and is the flood tide that fuels a new economic force.—Jim Forbes 03/20/2008.