Repeat after me: the Google Phone is not an iPhone killer

As the fabled first GPhone gets closer to launch (T-Mobile is expected to make the formal announcement tomorrow) the blogosphere and press have run heavy coverage comparing the Android powered HTC Dream to Apple’s iPhone, complete with the lines iPhone killer and Apple’s nightmare among others. In the school of sensationalist journalism 101, these headlines pass with flying colors, but they fail on another test: the school of stop drinking the kool-aid reality.

The first GPhone is not an iPhone killer.

The HTC Dream is as ugly as sin, the iPhone isn’t

Looks may not be everything, but the iPhone has good looks in spades, a supermodel compared to the Dream’s Ugly Betty. iPhone users like shiny things, and the iPhone is the shiniest of them all. People who have purchased iPhones, or are about to, are not going to be swayed by the Dream. We already know that the iPhone doesn’t deliver the best feature set, and yet it has sold millions. Android does seek to compete via on screen visuals, but the best platform in the world in an ugly box still looks ugly.

Sweet sweet music

Consider that various reports have shown that iPod sales have flatlined or even declined (the latest refresh to the iPod line was about stimulating sales). But people haven’t stopped listening to music, nor have they started buying non-Apple MP3 player, it’s just that their iPhones are also iPods. Really good, kickass iPods at that. Like or hate the iTunes/ iPod music lock-in, it’s the biggest game in town, and only one phone operates natively in this space, the iPhone. Android may offer open access, but it isn’t an iPod, and it won’t play with iTunes, at least not easily. Strike a sizable portion of music lovers off the list as GPhone buyers.

Business users

There is of course one area where the iPhone has struggled in its uptake, and that’s in corporate buys. The 3G iPhone does offer more features that its predecessor, like Exchange support to support the business case, and certainly no one is suggesting that businesses haven’t purchased iPhones, but at the top of the business market, ignoring SME’s, the most popular phone is the Blackberry. And what line do we hear from Blackberry addicts who won’t consider an iPhone over and over again? keyboard. They want a real keyboard. And what does the HTC Dream offer that the iPhone doesn’t? a keyboard.

What we see in this phone is some of the best features from the iPhone placed into an ugly as sin BUT practical handset that offers a real keyboard. If the Dream was a consumer play directed at the iPhone, they wouldn’t have picked practicality over aesthetics. T-Mobile wants Blackberry customers who like the features of the iPhone, but want a keyboard. If we have to call killer on anything, the GPhone is a potential Blackberry killer, because they’re the high end users most likely to buy it.

Where it might go wrong

We’re making presumptions that the first GPhone will be smooth sailing and a viable competitor to the Blackberry, or any existing phone. But it can go wrong. For starters, the phone is made by HTC, and while they’ve improved their product in recent years, the company has a track record of releasing awful phones, as most people who have used a HTC phone in the past can attest.

Then there’s the open nature of the phone. Google and T-Mobile see the open app marketplace as a selling point, offering more variety at a lower cost. It’s a great marketing line, but what happens when people take advantage of the marketplace and upload bad applications that either cause stability issues in Android, or compromise security on the phone. If Apple can’t get it right with a closed shop where they vet every application, the odds of the same issues, or worse situations occurring here are a sure bet.

Conclusion

Steve Jobs may be the worst for wear health wise, but he hasn’t lost one nights sleep over the GPhone. Google entering this space, and driving innovation forward is a positive that should be rightly celebrated, but lets not go over board, at least not yet. We will see new GPhones in the future that may seek to tackle the iPhone head on, but the HTC Dream isn’t that phone. My recommendation: start selling your RIM shares.