Google will allow developers to sell applications for its Android cell phone operating system beginning next week, as the search giant strives to expand in a smartphone arena.
Google's announcement marked a key step in the search giant's quest to catch up with Apple in the fast-growing market for smartphones.
Android is a software platform and operating system for mobile devices, developed by Google and later the Open Handset Alliance. The Open Handset Alliance (OHA) is a business alliance of 47 firms including Google, HTC, Intel, Motorola, Qualcomm, Samsung, LG, T-Mobile, Nvidia and Wind River Systems to develop open standards for mobile devices.
It signals Google's commitment to expand into a relatively hot mobile market, even as it pulls back on certain other initiatives such as broadcast radio. Google said its Android Market will initially carry paid applications from developers in the US and Britain, with plans to allow developers in Germany, Austria, the Netherlands, France and Spain to participate later this quarter.
That could present an outlet for developers such as Electronic Arts that have been anxious to expand sales of their mobile phone games to the Android Market, which has been limited to free applications until now.
Smartphones, which allow consumers to browse the web, send e-mail, play games and listen to music, in addition to making calls, are one of the few bright spots in a slowing technology and consumer electronics market.
While overall unit sales of cell phones declined 12.6 per cent year-over-year in the fourth quarter, smartphone shipments increased 22.5 per cent, according to research firm Gartner.
The HTC Dream (also marketed as T-mobile G1 in Europe and the US) uses the Android operating system. It is an internet-enabled smartphone with an operating system designed by Google and hardware designed by HTC. It is the first phone to the market that uses the Android mobile device platform.
The availability of applications that run on a particular smartphone are important to define and distinguish the product, said analyst Rob Enderle of the Enderle Group.
"It's what's providing that extra value and getting people into the stores," he said.
Apple, for instance, enticed a large community of developers to create both paid and free applications for its iPhone. According to a Google spokeswoman, there are currently 1,000 applications that run on Android smartphones. Consumers will buy the forthcoming paid Android applications via the Google Checkout payment product.