What is Google Up To?What is Google Up To?

Google has its sights set on the cell phone market, hoping to do to it what VOIP has done to residential voice.

Starting with Google's purchase of GrandCentral in 2007, industry watchers (and analysts) have kept a close eye on Google's move into the voice market. Google sat on GrandCentral for over a year before releasing it to a limited number of users in 2009 with expanded features including the ability to initiate phone calls from mobile devices, send free SMS messages, and transcribe voicemail messages into text. Google's attempt to deliver an iPhone version of its voice application caused a spat with Apple and AT&T over Apple's refusal to allow Google's voice application into its iPhone store.Now, Google has taken another step on its voice path with its recent acquisition of Gizmo, a SIP-based alternative to Skype that provided low cost calling services as well as the ability to freely connect to any SIP-based client or phone network. This move triggered more questions about Google's intentions. Did it plan to enter the consumer phone market to compete with the likes of Vonage as well as public phone providers? Did it just want to add voice capabilities to its Google Wave collaboration platform? Was it planning to take on Skype? Or, does it just want to mine phone call data for its search and advertising businesses?

While all of these are certainly possibilities, let me propose another alternative hypothesis: Google has its sights set on the cell phone market, hoping to do to it what VOIP has done to residential voice. The evidence, IMHO, is clear. With Android rapidly gaining mind and market share as a mobile phone operating system, Google is quickly putting together the pieces of a service that would offer a true alternative to per-minute based billing plans once 4G services such as LTE and mobile WiMax become widely available. Google's future voice offering could potentially leverage these high-speed mobile data services to enable free calling over existing data plans, crippling the business model of the wireless industry dating back the last 15 or so years.

With a Google voice service, customers would have a single phone number, featuring free calling from their PCs & mobile phones, and perhaps home WiFi phones. They would have a single number for all inbound calls, with a single voicemail box; oh and did I mention that SMS is free as well? Eventually Google could even add video services as phones and networks deliver support for two-way video calling. And around all of these services, Google can wrap targeted advertising, analytics, and search-based services geared toward the needs of mobile users and content providers. All of these services would be delivered over data network services, free from the constraints and costs of cellular voice services.

Want more evidence of this direction? D2, Beceem Communications and ECS just announced VOIP over WiMAX support for Android based phones. Remember as well that Google attributed its involvement in the FCC's 2008 wireless spectrum auction as a means to ensure that whoever won would have to provide open access to its network, meaning that they couldn't block potential Google services or devices. Could Google Voice over 4G emerge as the alternative to the recently announced One Voice effort to support voice over LTE? Only time will tell. But one thing is certain, Google's development of its voice strategy bears serious watching over the next year (and beyond).Google has its sights set on the cell phone market, hoping to do to it what VOIP has done to residential voice.