Android Gaining on Microsoft?

New York Times scribe Saul Hansell has an interesting story today on the rise of Android, the Google (GOOG) smartphone operating system that is ever-so-slowly eating into the client base for Microsoft's (MSFT) Windows Mobile system. Android, Hansell claims, has a number of substantial advantages over Windows Mobile. For one thing, it's free whereas Windows Mobile costs between $15 and $25 to install. In addition, Android's open-source software allows programmers to offer an endless array of applications, letting users customize each phone to meet his or her own needs. With Windows Mobile, it's take it or leave it. And leave it people seem to be doing; Microsoft's share of the smartphone market has fallen from 12 percent to 9.3 percent since the second quarter of 2008. Meanwhile, smartphone manufacturers and phone carriers are adding Android to their lineups.

In fact, Financial Times reporter Chris Nuttall claims, Android could soon emerge as the major smartphone that isn't the iPhone. Android systems now operate on 12 different phones with 32 phone carriers supporting them around the world. And Motorola, HTC, and Samsung are all busy developing their own Android-based handsets.

Still, that's a lot of buzz for a product that currently boasts only 1.8 percent of the global market. In a follow-up to his story, Hansell argues that Apple (AAPL) is still the major market monster but that Google is playing a slightly subtler game than you might think. All Google is trying to do, he suggests, is make sure there's no single dominant mobile operating system that could use its market share to isolate the user from Google's services. Offering free, open-source systems guarantees that the operating system market is sufficiently fragmented that Google still has room to maneuver. "Android doesn’t have to beat the iPhone," he writes. "It just has to be better than Windows Mobile."