Facebook Phone Would be 'Bad for Google'

Facebook (NASDAQ: FB) is only minutes away from announcing its newest product, service or software update and analysts are weighing in on the rumors."If the rumor of HTC + FB Android phone is true, then it is bad for Google (NASDAQ: GOOG) -- and this may have led to Andy Rubin getting fired -- and probably GOOG will need fix the Android Licensing loophole immediately," Trip Chowdhry, Managing Director of Equity Research at Global Equities Research, wrote in an e-mail to investors Thursday."[A] Facebook experience-optimized Android phone is nothing new for the industry. Amazon [(NASDAQ: AMZN)] Kindle Fire is based on Android, but optimized for Amazon.com experience and the same is for Barnes & Noble's [(NYSE: BKS)] Nook, which is based on Android but optimized for Barnes & Noble experiences."Chowdhry believed that this licensing structure "indicates a fundamental business model flaw in Google Android Licensing, and may indicate one of the many reasons for Google to fire Andy Rubin from leading Android."After attending various conferences for mobile and cloud platforms, Chowdhry said that he received the following converged view:"Google Android is Open Source and is not Apache V2. License, hence [it] is not like anyone can do anything with Android," he wrote. "Google should have shown a better business sense when allowing use of Android."Google should have put a clause in place to make sure that few applications from Google should always be in any Android Distribution, which is also called default applications...just like Apple [(NASDAQ: AAPL)] does in its iOS."Chowdhry said that these default applications could be Search, Chrome (the browser, not the OS), Google Plus, Google Voice, Picasa and Google Docs."But just like Apple allows, Google could also allow similar applications created by other developers [that] could be purchased and installed from Google Play," noted Chowdhry.He believed that this would have prevented Google from being pushed around by its "key competitors," such as Amazon and Facebook, "who with just a little effort are becoming prime competitors to Google in mobile.""Converged view is that for past three years Google Chrome team had been persuading Android Team to include Chrome Browser into Android, and Android team continued to deny Chrome team's request," wrote Chowdhry. "And it was only last year that Chrome Browser got included in Android after some executives intervened."If the Facebook and HTC rumors are true, Chowdhry expected Google to "fix its licensing terms on Android, so that Google's key competitors don't take a free ride on Google's Android R&D."Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis@benzingapro.com. Follow him @LouisBedigianBZ