Google's Android Gains On The Apple iPhone

Google Inc.’s  (NASDAQ:  GOOG)  Android mobile phone operating system continues to eat away at the Apple Inc. (NASDAQ:  AAPL) iPhone’s lead in the smartphone market.

According to ChangeWave survey of 4,000 respondents, completed Sept. 23,    37 percent of consumers planning to buy a smartphone in the next 90 days, 37% say they prefer the Android OS — a 7 point jump from an earlier survey and a new all-time high for the Google operating system.  ChangeWave has found a six-fold increase six-fold increase in consumer preference for the Google OS in a year’s time.

Apple eked out a 1 percentage point victory with 38 percent of respondents indicating an interest in making a purchase.  Demand, though, has dropped off from the 50 percent level seen in June as the hoopla surrounding the iPhone 4 launch died off.  The Cupertino, Calif.-based company does lead in customer satisfaction with the iPhone OS registering a 74 percent reading to Google’s 65 percent.

The data are hardly a surprise.  Other research outfits including comScore have reported the same thing for months.  The open question remains for investors is how will Google ever make money from Android, which it gives away for free.  Experts say the search giant probably will sell advertisements on the OS but consumers may not tolerate marketing messages sent over their mobile device which they didn’t request and may have to pay their carriers for the privilege of receiving.

ChangeWave’s findings underscored Research In Motion’s (RIMM) continued problems.   A pitiful 6 percent of respondents said they were interested in buying a BlackBerry and 31 percent of customers said they were very satisfied withe the product.  No respondents said they were interested in the Palm, whose OS registered a satisfaction rating of 32 percent.  Only 1 percent of respondents showed a preference for Microsoft Corp.’s   (NASDAQ:MSFT) Windows Mobile OS, whose satisfaction rating was 24 percent.

Apple can hardly be counted out of the smartphone market, but the pressure is on to create a spectacular iPhone 5.  Anything less will disappoint Apple investors and give another leg up to Android.

–Jonathan Berr