Before the new iPhone debuted, dozens of rumors circulated. One was that Apple, trying to broaden its global reach, would lower prices. Apple did not, holding its place as the premium smartphone brand.
A week later, Google, Apple's larger software foe, moved the other way. On Monday in India, Google launched Android One, a uniform operating system platform it plans to spread across developing countries to cement the next billion plus mobile internet users into its world. The move -- a partnership with three Indian hardware companies -- is also a direct hit against Microsoft and Samsung.
And it may mark Google's most concentrated push ever as a brand advertiser.
Google has hawked hardware before. The Nexus program, its effort to bridge high quality smartphone specs with low costs, began in 2010. From 2009 to 2011, Google's ad spending more than quadrupled, according to the Ad Age DataCenter. It rose steadily the next two years, reaching $2.84 billion worldwide as the company promoted its purchased Motorola brand.
Neither spurt amounted to much. Several estimates claim Nexus sales, which Google has never listed, failed to take off. Google agreed to sell Motorola to Lenovo in January.
With Android One, however, the search engine is making an ambitious claim: that it can offer smartphones close to or below $100. And it's starting in India.
Millions for the next billion
The three hardware offerings will start at roughly $105. Google is also aggressively subsidizing mobile data, a tactic its platform rival, Facebook, has deployed in emerging markets. For Android One owners on Airtel, India's second-largest wireless carrier, up to 200 megabytes of mobile data and apps are free -- eliminating a large barrier for usage of Google's web services in countries like India.
"Access for access's sake is not enough," Sundar Pichai, Google's senior VP and head of Android, an Indian native who launched Android One in New Delhi on Monday, wrote in a blog post. "With Android One, we not only want to help people get online, we want to make sure that when they get there, they can tap into the wealth of information and knowledge the web holds for everyone."
The company did not offer any details on the smartphone's capabilties with language services. A bulk of India speaks Hindi and other local lanauges.
Google is not alone in the race to spread cheap smartphones. Mozilla, the software company, recently unveiled a $33 smartphone in the country, joining a wave of manufacturers from China and India. For its effort, Google tapped three of the top local distributors -- Micromax, Karbonn and Spice -- with established brands as affordable handsets. But observers in India suspect most Android One decisions will hail from Mountain View.
"This will be more of a co-branded effort, because Google is pouring money into it," said Neil Shah, an analyst with Counterpoint Research, in Mumbai. "Google is trying to regain control, and very tightly."
To promote Android One this fall in India, Google is preparing to spend "at least several hundred million dollars," according to a report in The Information, a tech website.
A Google spokeswoman declined to comment.
Not another China
Android One is, above all, Google's bid to avoid another China. There, Android is dominant, but it is tweaked -- hardware companies will "skin" the software, layering their own apps and brand on top -- beyond recognition and beyond Google's reach to control mobile ads.
India doesn't pose the same problem. In part, because it is smaller. Of the total mobile handsets in India (estimates vary from 650 million to 815 million), less than 10% are smartphones. A tidal wave is coming, however, as Indians upgrade from basic feature phones. During the first quarter, smartphone growth soared by 186%, according to IDC; China registered just 31% expansion.
Before this year, smartphones in India were dominated by Samsung and Nokia. But the pair have failed to drop prices to reach consumers. (Apple, whose expensive phones lack carrier subsidies, is insignificant.) With its Android One collaborators, Google is staking its claim against an adversary, Microsoft, which owns Nokia, and its own biggest ally, Samsung.
Google may also be picking a winner. Last quarter, Micromax, the largest of the three Android One device-makers, surpassed Samsung as the top handset distributor in India, according to Counterpoint Research. It is closing in on Samsung in smartphones, too, with 19.1% of the market; Karbonn, another Google partner, is third, with 5.9%.
From Android One, Micromax will see a boost of half a million shipments in the fourth quarter, an eighth of its overall smartphones sales, Mr. Shah said. Karbonn expects to go public by 2016 on the back of the Android One lift.
Micromax's smartphones sell for between $108 and $113. It has upturned the market by packing the budget devices in "very, very premium" branding, said S. Subramanyeswar, the national planning director for Lowe Lintas & Partners, the IPG agency that has worked with Micromax since 2011.
"It looks like a Samsung or an Apple," he said. "The price comes as a phenomenal surprise...That has created a fantastic aura for the brand."
Like many marketers in India, Micromax relies heavily on celebrities, tapping Bollywood megastars for endorsements. Last October, it started running spots featuring Hugh Jackman. The company more than doubled its ad budget in the most recent fiscal year to $33 million, roughly 2.9% of its revenue, according to Mr. Shah's estimates.
Google as brand
Despite their growing cachet, the Android One hardware brands will still need Google's aid. Micromax's estimated revenue, $1.1 billion, is less than a tenth of what Samsung spends globally on advertising alone.
Google likely wants it that way. Recently, the company has tried to exert more control over its Android phones -- leaning on partners to stick its logo, a green robot, on the device. Samsung, by far its largest hardware partner, has pulled the other way, releasing its own apps and testing its software system Tizen. The leaner India companies are more malleable partners.
Mr. Pichai and Google may be confident that compressing the costs of Android phones can claim the bottom rung of the market. And while Indian consumers are price conscious, their incomes are rising -- and the smartphone market can turn swiftly. To keep up, Google must bare its face as a brand.
"With this over crowded market," Neha Dharia, an analyst with Ovum, wrote in an email, "handset vendors can no longer compete on price alone."
Google said it plans to expand Android One into Idonesia, Philippines and other South Asian countries by the end of the year.