Is Google+ the endgame for Android?

Mike Dano
The company that makes the country's most popular mobile phone operating system recently introduced a new social networking service that is geared toward unseating market leader Facebook. But what does Google+ mean for Google (NASDAQ:GOOG), Android and the rest of the mobile industry?

The long-term effects of Google+ (which already counts 20 million users) could be significant. The service works as a glue for a wide range of Google's services and establishes a network among users that, if successful, could more tightly bind them to Google's offerings. This reinforcing effect could easily extend to mobile if Google manages to inject Google+ into the core of Android. Right now, Google+ on Android is little more than an app through the Android Market, but in the future the platform could be pushed into every corner of the OS, allowing users to make calls, send messages and conduct other operations all via Google+.

But how will Google+ affect Android handset makers? ABI analyst Michael Morgan said Google's rapid-fire pace of innovation on Android has made it increasingly difficult--and unnecessary--for handset makers to develop their own "skins" for Android. Offerings like Motorola Mobility's (NYSE:MMI) MotoBLUR or HTC's Sense could fade into irrelevance if Google+ arrives on Android in a big way.

For Android developers, Google+ could represent a major new source of opportunity. So far Google+ remains closed, but recent evidence hints at a Google+ ecosystem of games and other content similar to what Facebook has created with Facebook credits. If Android developers are allowed to quickly and easily tap into the audience of Google+, the result could create a perpetual cycle of better content, satisfied users and bigger revenues for developers. An Android doorway into Google+ would create "another reason to develop for Android. This might be a way to re-invigorate interest in the [Android] ecosystem," Morgan said, noting recent research pointing to developer apathy toward Android.

For wireless carriers, Google+ could represent another layer between customers and the carriers providing their service. "It's closing another door for carriers," Morgan said, explaining that Google+ in the future could provide the texting and calling services that are carriers' bread and butter. Already Google offers Google Voice and Google Wallet, and in Google+ the company offers a group texting service called Huddle and a video calling service called Hangouts. Huddle is already available via the Google+ mobile apps, and it's a good bet Hangouts will be mobile soon also.

Of course, wireless carriers will continue to charge users for voice and data regardless of Google+, but they could be seen as just a pipe to the service rather than another player in the field.

But it's Apple (NASDAQ:AAPL) that could be the company with the most to lose if Google+ turns into a success. "Apple needs the network effect, period," said CCS Insight analyst John Jackson, explaining that the Google+ network could create an effect that reinforces itself: As new users come into the service, they will bring in other new users, and that cycle will continue.

Apple made a stab last year at social networking with its Ping effort in iTunes, which allows users to follow and discuss their favorite musicians. However, most consider Ping a failure. Apple's second major attempt at social networking will come later this year with iOS 5, which features built-in support for Twitter. It's unclear if Apple will extend the same support to Google+. But if Google+ is a success, users could migrate to Android from iOS if Android provides the best mobile connection to Google+. (Google recently released a Google+ app for iPhones--but only after releasing one for Android first.)

Ultimately, analysts argued that Google+ won't have much of an impact on the Android industry. Said Jackson: "Google+ is the end game for Google, and Android is what it has always been," which is a way for Google to tap out a spot in the mobile world.

Concluded Current Analysis analyst Avi Greengart: "Look, there's no question that Google would like to own a big piece of social networking, but I don't know that this is specifically an Android initiative at all. A lot of the information on the Web is in social networks, and they also have invaluable information about how individual users are interconnected to one another. While there is certainly a mobile component to this, I think at its heart Google+ is about indexing information and selling ads. Any benefit it brings to Android is gravy."

Nonetheless, I think Google+ could grow into a serious part of Android. Imagine a Google+ phone with a contact list organized around the people in your Google+ circles and reinforced with location-based information provided by nearby Google+ users. Such a phone could potentially replace text messages with Huddles and phone calls with video Hangouts, and integrate third-party Android games and apps into a networked social stream that could foster both competition and collaboration.

Is that the future? Let's discuss it on Google+. +Mike Dano