Google pressures Acer to cancel smartphone running Android rival

By on September 13, 2012, 6:30 PM

Acer has reportedly postponed the launch of a new smartphone running a Chinese-developed Android competitor because Google threatened to retaliate. The PC maker planned to hold a press conference in Shanghai on Thursday to unveil its CloudMobile A800 handset, which is geared toward the Chinese market and runs Aliyun 2.0, an operating system created by e-commerce giant Alibaba Group.

However, Acer cancelled the event mere hours before it was expected to jointly unveil the A800 with Alibaba. An Acer executive declined to explain the abrupt change of plans, saying only that the unveiling was axed for a "special reason." However, an unnamed company official quoted in a report on the Dow Jones Newswire said the cancellation is related to Google's concerns over Acer's use of Aliyun.

Speaking with CNET, Alibaba said that Google threatened to end its partnership with Acer if the company supported Aliyun. "Our partner was notified by Google that if the product runs Aliyun OS, Google will terminate its Android-related cooperation and other technology licensing with our partner," CNET's source said, adding that Alibaba understands and respects Acer's decision to delay the A800's launch.

In a different comment on the situation, an Alibaba spokesman said Google's actions are "clearly unfair to consumers." The representative said Alibaba is concerned about how Google's move will impact consumer access to competitive products. "We believe that by introducing the Aliyun OS we are giving consumers and hardware makers more options which is the foundation of a healthy and strong market."

Although most people probably aren't familiar with the A800, the device's launch was a big deal for Acer and Alibaba. Acer is the first major system vendor to build a product with Aliyun OS, which has previously only appeared on Chinese handsets from Haier and Tianyu. The A800 would strengthen Acer's presence in China's smartphone market while expanding the share of Alibaba's nascent mobile OS.




User Comments: 31

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Wizz-Fizz Wizz-Fizz said:

If this is accurate and true, surely its a clear cut case of Third Line Enforcing

1 person liked this | Guest said:

Wow. What a bully. It's Darth Eric running the new evil Empire????

2 people like this | Wagan8r Wagan8r said:

I've always held that Google was more "evil" than Apple and Microsoft combined.

Guest said:

How come it doesn't say what exactly about the OS was so bad in this story?

penn919 said:

While I definitely don't like the smell of this, it's certainly better than stamping out your competition by lawsuits. However, Wagan8r is right. I would like to know more of the details.

Chazz said:

While I definitely don't like the smell of this, it's certainly better than stamping out your competition by lawsuits. However, Wagan8r is right. I would like to know more of the details.

How is threatening financial harm in order to stamp out the competition better than taking a legal route? This is anti-competitive and illegal in a lot of markets.

Archean Archean, TechSpot Paladin, said:

ACER capitulated without much fight I guess, which also shows that it is finding it difficult to make a space for itself in the mobile sector (by putting all its eggs in the Google's basket).

3 people like this | ReederOnTheRun ReederOnTheRun said:

I've always held that Google was more "evil" than Apple and Microsoft combined.

I used to think that, but Google is actually well known for giving away their products for free or making better products at low prices (google fiber is a good example of both). They seem to live true to their goal of making the world's information accessible to everyone.

In this case I was disappointed at first, but look at it from Google's position. Your business partner is going to stop using your os (a giant source of revenue for you) to indulge in some foreign brand and you're just supposed to support them as usual? Of course not. But they aren't forcing Acer's hand by going after them in court or threatening to destroy them. They're just saying if you don't support our products then we will just take our business to someone who will. That's a perfectly reasonable stance for a company to take.

Guest said:

All the big companies are evil, some are just better than others at hiding it.

1 person liked this | Wizz-Fizz Wizz-Fizz said:

I've always held that Google was more "evil" than Apple and Microsoft combined.

I used to think that, but Google is actually well known for giving away their products for free or making better products at low prices (google fiber is a good example of both). They seem to live true to their goal of making the world's information accessible to everyone.

In this case I was disappointed at first, but look at it from Google's position. Your business partner is going to stop using your os (a giant source of revenue for you) to indulge in some foreign brand and you're just supposed to support them as usual? Of course not. But they aren't forcing Acer's hand by going after them in court or threatening to destroy them. They're just saying if you don't support our products then we will just take our business to someone who will. That's a perfectly reasonable stance for a company to take.

Now that I have read your comment, I can see both sides of the argument.

The headline of this article put a very negative connotation to what follows in the story, and the wording of the article is also very forceful and negative, using words like "Threatened" "Terminate" and was very open ended with the line " its Android-related cooperation and other technology licensing"

It very much paints Google in a "Big Bad Corporation" light and Acer as the "Poor Victim"

I will take the information in this article in the spirit I am sure it was meant.... Impartiality

Jibberish18 said:

I won't comment until I know the whole story (which is asinine because I'm commenting right now!) BUT I will say I don't see why Google would do something like this for the Aliyun OS but not something such as Windows Phone. They're both OS's are they not?

Guest said:

You guys seem to have a short memory when it comes to Google in China. China is the bad guy here. Google is trying to prevent itself getting screwed by the Chinese once again, so it's making Acer choose sides. Acer chose wisely imo.

Guest said:

Exactly..we don't know the whole story. It's possible that Acer had a certain agreement with Google and was now trying to double dip; who knows.

The less things coming from the asian markets, the better - lets bring jobs back home!!

Chazz said:

Really guys? This is very Anti-competitive. Microsoft got convicted for using some of the same tatics. Acer is not going to ditch Android, they are just trying to differentiate their business. Same as samsung using bada and windows OS alongside Android. Google has no place threatening them. I thought Android was supposed to be open and Google was supposed to do no evil. This is going against both.

Acer should be allowed to offer what they want without being blackmailed. It's crazy that you could blame the editors for reporting a story like it is.

1 person liked this | Guest said:

You do realize that this 'foreign' OS is just a fork of android, right? And that probably has google upset. I would be.

And since Acer is a partner with google now in developing devices that run on android, google has every right to deny ASSISTANCE to acer for android developement for any reason whatsoever. And no way is acer ever going to call that coercion. There is no way google can STOP acer from making and selling whatever they want to make, including android, but Google is not obligated to ASSIST them in that developement. And that is what is at issue here. Google told them if you go with this forked project, we won't help you with your devices running Real Android. geeze.

Chazz said:

And they do the same to samsung right? Or HTC? How about LG? They're throwing their weight around. Chinese citizens are more likely to use a product homemade and google is afraid of that. Just look at the popular search engine in china. Baida dominates Google. This is low, It's a sad day when a company is able to use moves that the "evil" Microsoft did and get praises for it. I really did expect more from google.

Guest said:

Why blame on Google? It's clearly that it's Acer's fault. Once you are partnering with other company then create a similar (or fork) products. It is reasonable for Google to cut the partnership as it is showing that Acer wants to create their own OS, but it doesn't stop from Acer to contiune sell their smartphone with Android anyway. Hences for Android license that allows them to as Amazon has done it.

nismo91 said:

Wow, am I the only one who loves its design? curve top and bottom has always been my favorite. it doesnt looks like a low-end device (e.g. acer allegro) too. if only it runs windows phone...

likedamaster said:

So google has become the tyrant now? Good to know. OS probably looks & works better than Androids juvenile interface. But seriously though, competition is supposed to be good. What were they thinking?

Jibberish18 said:

"Compatibility is at the heart of the Android ecosystem and ensures a consistent experience for developers, manufacturers and consumers.

Non-compatible versions of Android, like Aliyun, weaken the ecosystem. All members of the Open Handset Alliance have committed to building one Android platform and to not ship non-compatible Android devices.

This does not however, keep OHA members from participating in competing ecosystems."

Google's Quote ^^^

Archean Archean, TechSpot Paladin, said:

@ReederOnTheRun

Yet their action means that they want to kill any 'competition' right in its tracks whereby limiting user's choice.

What if (highly likely IMHO) someday sammy decides to fork out its own version of android (just like Amazon) to lessen its reliance on Google? Remember no body wants to put all of their eggs in just one basket. I think there is a chance that in next two/three years market may change, and Google may not even be in such a position to repeat this type of behavior.

ReederOnTheRun ReederOnTheRun said:

@Archean

Before we start making accusations, keep in mind what is actually going on here. Google isn't "threatening" any damage. They aren't "killing" any competition. They are recognizing that their partner wants to phase out Google for an incompatible version of android. Obviously, this is not what business partners should be doing. So if Acer does go through with it, Google won't be attacking them or the new phone, they will simply let Acer and their new partner fend for themselves.

Acer is its own company. It's not Google's responsibility to support it, especially under these circumstances.

RajeGera RajeGera said:

If this is true..google is definitely misusing its power in bringing down the competition.

Camikazi said:

If this is true..google is definitely misusing its power in bringing down the competition.

Acer violated OHA guidelines by using Aliyun and Google reminded them of it, that is why Acer backed off so quickly and without a fight.

Archean Archean, TechSpot Paladin, said:

If Google makes a threat of pulling the plug on whatever support (e.g. map or search services) it is providing to ACER for android products, it is clearly an attempt to stop them from launching a product which is going to compete with their platform. I am not sure how I am wrong here.

It will be just like if MS asks HP or Dell to stop selling Servers or Computers with Linux (I.e. a competing platform) backed up by some sort of a threat.

Camikazi said:

If Google makes a threat of pulling the plug on whatever support (e.g. map or search services) it is providing to ACER for android products, it is clearly an attempt to stop them from launching a product which is going to compete with their platform. I am not sure how I am wrong here.

It will be just like if MS asks HP or Dell to stop selling Servers or Computers with Linux (I.e. a competing platform) backed up by some sort of a threat.

Joining the OHA means you are agreeing to certain rules in order to have early access and support and certain apps. Releasing phone running a forked, non-compatible version of Android is against the rules and Acer knew this. If you are not part of the OHA you can fork and release any fork of Android that you want as long as you do not call it Android or market it as Android compatible (Aliyun did this BTW) but once you are a member you agree to no longer do this or your membership would be revoked (what Acer almost did).

This is the reason that Amazon can release their Kindle with their fork of Android without problem since they are not part of the OHA. If Amazon was part of the OHA their Fire OS would not exist since it would go against the rules setup by the OHA. You can't get all the benefits of a group and try to get all the benefits of other groups at the same time if it violates the rules of the first group. Acer needed to pick life with the OHA and it's benefit or Aliyun and it's benefits and it seems the OHA is a more reliable way to go.

ReederOnTheRun ReederOnTheRun said:

@Archean

And you'd still think Microsoft is wrong, even if that "threat" is simply walking away from a deal? These aren't charities, or start up programs, these are business deals. Forcing a company to work with another company solely because that other company wants to one day be another competitor is ridiculous and an idiotic business strategy. That's fine if Acer wants to do that but just like companies before it, there will be sacrifices and it will be a risk for that company if it doesn't succeed. It's not Google's responsibility to help them if success will mean damage to Google.

If we start forcing companies to make unprofitable deals, it will end up decreasing market efficiency and ultimately hurt the consumers. You can learn this in just about any macroeconomics class.

Chazz said:

Android is open source. It is OPEN source. How is it open source with this kind of behavior? What happens if the GNU foundation starts pulling licenses of operators who provide apps for android? Open is open, and you shouldn't punish anyone for using this philosophy. This is just on moral grounds. On other grounds, it's anti competitive.

1 person liked this | PinothyJ said:

It is Acer: were you really going to buy an Acer anyway...

1 person liked this | Camikazi said:

Android is open source. It is OPEN source. How is it open source with this kind of behavior? What happens if the GNU foundation starts pulling licenses of operators who provide apps for android? Open is open, and you shouldn't punish anyone for using this philosophy. This is just on moral grounds. On other grounds, it's anti competitive.

You seem to be confusing Android with Google they are not the same thing. Android is a free open source OS that anyone can use and alter as they wish, Google is a company that is based on making profit and is not open source (free services does not mean open source BTW). The OHA is a coalition of companies that worked together to create a certain ecosystem based on Android and they set certain rules they must ALL abide by in order to be part of the coalition.

What Acer did was break the rules of the OHA and doing so means they would no longer have access to the ecosystem that the OHA provides. What Google did was remind Acer that if they released that phone they would be breaking the primary rule of the OHA and it would mean they would have to leave the OHA and lose the benefits of the group. I don't see why people can't understand this. It would be the same if Amazon decided to start an identical coalition based on their Fire OS I am almost sure they would put a rule that says the same thing as the OHA rule does. In that case Amazon would back, support and give access to their services as long as the company did not take their OS and fork it creating a competing OS and releasing a phone based on it (what Acer was about to do).

Guest said:

All big company are just the same evil.. they do not want share another bite to the new competitor, not even any chance

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