Google activating 550,000 Android phones per day

Google (NASDAQ:GOOG) CEO Larry Page said the company is activating 550,000 Android smartphones per day, a marked increase from the rate at which Google said it was activating Android devices just a few weeks ago.

Google Android chief Andy Rubin said on June 28 via Twitter that Google was activating more than 500,000 new Android devices every day. Rubin also said at the time that activations are growing at a pace of 4.4 percent every week. Google said in mid-April that it was activating around 350,000 Android smartphones per day.

Separately, Google's Susan Wojcicki, the company's vice president of products, provided additional Android metrics. She said there are 135 million Android devices activated in total around the world, up from 100 million two months ago. Additionally, Wojcicki said there are 400 Android device models globally, and that Android Market has 250,000 apps. She said users have downloaded a total of 6 billion Android applications to date. By comparison, Apple (NASDAQ:AAPL) said earlier this month that downloads from its App Store passed 15 billion worldwide. 

Although Google licenses Android for free to handset OEMs, the company makes money from advertising on mobile search. Google said last year its mobile business--including search, advertising and services--added $1 billion to its revenue streams annually.

"People rightly ask how we will monetize these businesses? And of course I understand the need to balance the short term with the longer term needs because our revenues and growth serve as the engine that funds our innovation," Page said on the company's earnings conference call. "But our emerging high usage products can generate huge new businesses for Google in the long run, just like search. And we have tons of experience monetizing successful products over time."

However, Google's Android platform has been under pressure from software giant Oracle, which has sued Google and argued that Android infringes on Java patents it owns as a result of its acquisition of Sun Microsystems. The judge in that case, William Alsup, recently laid out in a court notice questions he intends to ask Google in the case. "It appears that early on Google recognized that it would infringe patents protecting at least part of Java, entered into negotiations with Sun to obtain a license for use in Android, then abandoned the negotiations as too expensive, and pushed home with Android without any license at all," he wrote in the filing. "How accurate is this scenario? Does Google acknowledge that Android infringes at least some of the claims if valid?"

If Google is forced to pay Oracle damages or royalty fees as a result of the lawsuit, it could potentially add to the total cost of licensing Android.

During the company's earnings conference call, a participant asked about Android intellectual property concerns. Google's Page answered: "Despite the efforts of some of our competitors, there hasn't been any slowdown" in Android adoption, he said. He reiterated Google's commitment to the platform. 

In terms of financials, Google's second-quarter results easily bested Wall Street analysts' expectations. The company's net profit in the quarter was $2.51 billion, up from $1.84 billion in the second quarter of 2010. Google reported revenue excluding traffic acquisition costs of $9.03 billion, up 32 percent from $6.82 billion in the year-ago period. Traffic acquisition costs, or the portion of revenues shared with Google's partners, increased to $2.11 billion in the second quarter, compared to TAC of $1.73 billion in year-ago quarter. 

For more:
- see this release
- see this NYT article
- see this AllThingsD article
- see this Seeking Alpha transcript

Special Report: Wireless in the second quarter of 2011

Related Articles:
Google's bids on Nortel's patents raise questions
Google unveils redesigned Android Market for smartphones 
Android device activations explode to more than 500,000 a day
Google activating 350,000 Android devices per day
Android chief Rubin promoted at Google

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