Is Microsoft planning to fork Android?
Yes, we've all read the article saying "Android is unforkable". (And there are some commentators on this very forum who believe that Android is not open source, and that it's impossible to fork it.)
However, Ben Thompson says this is wrong, and argues that forking Android is, in fact, the rational strategy for Microsoft. His argument is convincing, although it's hardly reassuring if you're an Android/Google fan, since the Ben Thompson plan is essentially to apply Microsoft's traditional strategy of "embrace, extend and extinguish" to Android while simultaneously using patents lawsuits to bully and coerce OEMs into giving up Google's version of Android:
Fork Android and offer a version of AOSP (Android Open Source Project) with Microsoft services, app store (more on this below), and, most importantly, patent protection to Chinese manufacturers.
This is the most misunderstood aspect of the Lenovo-Motorola deal; Motorola was worth more to Lenovo than almost anyone else because the deal included the right to cross-license Motorola’s patents. Without the ability to cross-license patents with other smartphone manufacturers, royalty fees can balloon far beyond the 15-20% of a phone’s cost that I referenced above; this would effectively destroy Lenovo’s cost-structure advantage. It is for this reason that Lenovo has only sold phones to date in countries with poor IP-protection; the Motorola patents let them go abroad much more competitively.
The situation is no different for the other Chinese manufacturers like Coolpad. Patents have built an effective wall against Mediatek-powered Chinese manufacturers, leaving Android-powered Samsung dominant in most developed markets; Microsoft is uniquely positioned to enable and encourage said manufacturers, who are already competing strongly against Samsung in China, do the same in the rest of the world. They would all use Microsoft services abroad in exchange for patent protection, just as they use non-Google Chinese services in China.
Now I see that Android Police has an update on the rumoured Nokia Android phone. And it includes the following:
Even though the low-end device runs Android, it has been heavily customized so that it only slightly resembles competing devices, so much so that it doesn't come with access to the Play Store. Yes, you read that right. Instead the device will come with apps and services created by Nokia and Microsoft, along with a separate app store offering Android apps.
The plan here is for Microsoft to increase hardware sales volume without tying customers to Google services. This way the company can help support the cost of combatting Apple and Google in a field where its own operating system frankly isn't that competitive.
This seems suspiciously similar to what Ben Thompson is suggesting.
Most people have dismissed the Nokia Android phone as an irrelevant curiosity that will probably be killed off as soon as Microsoft takes over. But what if it's a trial balloon designed to test whether the Ben Thompson plan is viable? If Microsoft were considering this strategy, they probably wouldn't go all-in right away - they would test the waters first with a low-profile, low-risk pilot project. A low budget Nokia Asha-type device seems like precisely that sort of project.
The only flaw in this theory - and I admit that it's a big one - is that Microsoft doesn't yet own Nokia, and this project was started before the buyout was even announced. But who knows exactly what was going on behind the scenes? Microsoft and Nokia have been very close ever since Elop become CEO. It's not impossible that this project had some sort of tacit approval from Microsoft. For example, imagine a scenario where Nokia went to Microsoft to discuss patent royalties for a planned Android device, and Microsoft agreed to waive them if they stripped away all the Google services and replaced them with Microsoft ones?