As many of you already know, it has been confirmed. Google will be releasing its own smartphone – due to hit the market in the new year.  Google has decided to bring the phone to market outside the constraints of a particular carrier.  They will sell it as an unlocked phone, creating a freedom of choice in mobile service that is rare amongst North American consumers who purchase smartphones.  So what does this mean for the operators? 

With Google taking the first step that some are dubbing as ‘risky’, it will be interesting to see how this changes consumer behaviour and their attitudes towards long-term contracts with carriers (the contracts enable consumers to save money on the purchase of an expensive handset).  Furthermore, will this set a precedent for other parties such as Apple, RIM, and the like who could potentially benefit from bringing an unlocked phone to market?

The key to success in this approach is the set of services that are offered or made available on the phone.  Applications or services enabling the use of VoIP calling over WiFi and tethering of devices will certainly make an expensive smartphone worth the while if consumers can see the long-term savings and vast array of services that might otherwise be unavailable on a locked phone.

This move by Google, should have the operators carefully analyzing their strategy for acquiring customers.  They will need to look beyond exclusive hardware agreements and think about a ‘value-added service’ based approach for attracting and retaining customers.  Many are beginning to view operators as mere data pipes, and this can quickly become true unless the operators find innovative ways to make customers value them beyond their networks.

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Name: Anant Tailor Title: Mobile Financial Services Delivery Lead Company: DonRiver Inc. View Anant Tailor's Blog