China Mobile's Custom Android "oPhone" Is In Serious Trouble

China Mobile

Death notices take a while to get here from China.

A year ago I wrote a guest post for Business Insider after taking a trip to China with Sarah Lacy from TechCrunch and learned about a big push from China Mobile to make the oPhone: the end-all-be-all Android that would be customised specially for a Chinese carrier with a proprietary set of apps.

It seems there was a problem with the development, and I got a chance last night to catch up with an ex-Googler from China to see what he thought might have been the real issue that caused China Mobile to discontinue the project.

As I wrote last summer it seemed like the China Mobile oPhone project had very strong backing. China Mobile and venture-backed Borqs (no relation to the Swedish chef), Aspire and Lenovo Mobile had set out on a 2-year project to develop China Mobile’s Android-based oPhone, which launched in August 2009. However, the pedigree of these partners did not carry the same weight to the new China Mobile management as if China Mobile had created their own internal department for Android development.

Last Thursday the Mobinode  quoted “cautiousness” as the reason why their Android project may get cut. Inertia may be a better term, since Apple, Dell, Philips Samsung and Lenovo’s own Android based LePhone (happy phone!) all have not brought in great smartphone sales results. To have a blockbuster phone in China, it needs to be in the tens of millions of device sales per year, or “hero phones” as Nokia calls its best selling devices.

What’s holding back smartphone OEMs from being successful in China? 

It is possible that iPhone has reached 10 million in new devices each year as it is rumoured that 1 in 5 iPhones sold around the world make it to China, get unlocked and then activated on one of China’s operator networks. But what makes selling smartphone directly in China so hard? Is it price? Is there still an issue in gaining mass scale for $400-$700 USD mobile phones without subsidies?

Hypothetically, if price were the problem, I wondered what if an Android phone were built on the aggressively priced MTK platform. MTK creates very cheap motherboards for mobile phones, but the problem is MTK historically has only sold its hardware packaged up vertically with its own OS so manufacturers could not replace the MTK operating system with Android. It is rumoured that MTK may open up to selling the motherboard divorced from the OS software, but there’s another, bigger problem that signals maybe why China Mobile decided to pass on their homegrown oPhone; the pace of Google’s software updates.

A wicked witch in the Gingerbread house. 

China Mobile may have seen the writing on the wall of late when Android 2.1 launched with massive upgrades. If we consider that Android has already released its 2.3 OS called Gingerbread while China Mobile’s oPhone is languishing in buggy, pre-2.0 land, we may conclude that by trying to lock down an “Open” phone China Mobile’s project was doomed from the start.

Maybe all of that customisation work to make the oPhone run a proprietary music store and non-Google search meant that they lost momentum and could not catch up with fundamental changes in the UI.

The real nail on the coffin to me however was what I heard about what consumers are doing to upgrade their Lenovo LePhones, which are also still sold running Android’s pre-2.0 software. I’m not just talking about the geekiest consumers updating to the latest, less stable Gingerbread 2.3, but normal consumers are buying the Lenovo LePhone and are flashing the software up to 2.1 and 2.2.

Because China’s mobile devices are usually built to be carrier agnostic, services for jail-breaking and even flashing the whole OS on devices can be found anywhere, sometimes even at kiosks where Chinese buy cigarettes and gum on the street! What is to stop the casual consumer from just flashing their device and effectively ditching all the centrally planned China Mobile apps for those in the Android market?

They left breadcrumbs. 

Yesterday afternoon, Dusan from IntoMobile picked up the story and added a twist, that even if China Mobile were to completely drop the Android initiative (which it hasn’t “officially” done yet) smaller developers are likely to jump at the opportunity.

Possibly, but HTC from Taiwan and others in the region have such big markets in the US and EU for Android phones, it may not make sense for them to jump through all these carrier hoops for a China device. Moreover, no OEM has figured out how to get to Nokia’s hero volumes for smartphones in China.

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