First, Google unveiled a mobile operating system. Now, rumours are flying about Google going the next wireless step by acquiring Sprint Nextel. But should the Net giant leap into the telecom industry with this major purchase?
Digital Journal — Blame it on the fallout from Sprint’s decision to stop working with Clearwire
on building a nationwide WiMax network. Or credit Google’s Open Handset Alliance and recent launch of its Android OS
. No matter how you see it, Google is vying for a piece of the telecommunications pie, and now the blogosphere is swirling with the rumour that Google will soon buy Sprint Nextel.
According to TMCNet blogger Rich Tehrani
(the source of this much-hyped buzz): "At a certain point the company realized YouTube was too strong a competitor and Google threw in the towel and purchased the video competitor. So one wonders if history may indeed repeat itself and Google will start with the Open Handset Alliance and decide soon they need an acquisition to boost their presence in the space."
Muscling in on mobile search is Google’s mandate, judging by the weight it put behind Android and the OHA. It’s evident the alliance and OS might not be enough to truly propel Google high on the telecom ladder, but owning a network-friendly company like Sprint Nextel could help its fortunes.
If Google owned a carrier, its entry into a very competitive market would already be less difficult. Once Google becomes a brand name in bricks-and-mortar outlets, Google would have elevated to another level of tech company: online everywhere and now offline somewhere.
But Tehrani pointed out that the Google-Sprint deal wouldn’t bode well for the search-engine empire. Entering the telecom business requires more government lobbying and FCC intrusions, he said. He added:
One would imagine if Google owns its own network, other network operators would not be too happy to be part of the OHA. This could slow progress for Google getting on the handsets of other wireless service providers. [And] a purchase of Sprint Nextel would make Verizon and AT&T go crazy and they would make life even more difficult for the search leader. Could they make life any more difficult than they do today? Maybe.
Tehrani also predicted a scenario where Google would buy Sprint and give away its telecom service free. Plus, Google could reopen talks with major WiMax players and blanket the U.S. in free — or ad-subsidized — wireless Internet.
Not every tech observer sees the Sprint-Google deal coming anytime soon. Google has always wanted to get people to look at ads on various platforms but as Silicon Alley Insider says
, buying a carrier -- and trying to make part of the wireless industry as its own -- is not in line with Google's goals.
It’s easy to speculate on what a company will do while a major deal is still in rumour phase. But it’s difficult to picture how the telecom landscape will be forever altered if Google followed through on the buzz and actually bought Sprint Nextel.
If Google bought YouTube without batting an eyelash, what’s to stop it from acquiring a legendary telecom company in a market yet to be Google-ized?