Venture Investors Keep Eye On Google's Android Contest

November 14, 2007 7:30 AM ET
By Timothy Hay Of DOW JONES NEWSLETTERS (This article was originally published Tuesday) Google Inc.'s (GOOG) plan to offer $10 million to developers who come up with the best new applications for its Android mobile-phone platform is giving start-up companies and venture capitalists much to think about. In two separate contests, the Mountain View, Calif.-based Internet giant is awarding prizes ranging from $25,000 to $250,000 to independent programmers with compelling ideas. "We will be watching this very closely," said Heikki Makijarvi, a partner at Accel Partners, an early investor in Facebook Inc., which earlier this year opened up a platform that has attracted thousands of applications for its social-networking site. "There may be a number of exciting start-ups involved with this." Google's blog page devoted to the Android platform (http://android-developers.blogspot.com) was buzzing with questions, comments and criticism soon after the announcement. "We've seen a tremendous number of downloads," said Google spokesperson Barry Schnitt. "People are interested in exploring what we've got." Schnitt declined to say how many had so far downloaded the information package, which includes the software kit developers will need. "This is a great step forward to breaking down barriers," said James Wanless, co-founder and chief executive of Talkster Inc., a Toronto-based online phone company. "The big carriers have been stifling innovation, and Google is opening it up. There will be a fever happening." Talkster has already developed a mobile application that allows callers to access Google groups, Wanless said. "At a basic level, we are taking what we did on the fringes, and embedding it in the handset." Last week, Google announced the Open Handset Alliance to create a Linux-based Android platform with a group of more 34 mobile partners that want to see a more collaborative environment as handheld technology continues to evolve. Sergey Brin, a Google co-founder, said in a statement the company has come up with some good applications, but "the best applications are not here yet, and that's because they're going to be written by developers." The contests will be judged by a panel of mobile experts from the Open Handset Alliance. The $10 million will be spread across two separate contests, with 50 prizes of $25,000 each to be given on March 3, 2008, before the release of Google's Gphone. The second deadline will be May 1, 2008, after the Gphone release, with ten $275,000 awards and ten $100,000 awards to be given out, Google said. And there could be more in the way of rewards, if venture capitalists remain as interested as they seem now. "You'd be crazy not to be keeping your eye on that space, especially when Google is involved," said Dave Carlson, chief executive of eonBusiness, an early-stage tech investor. "You have to look at the direction mobile platforms will go. People won't have big computers five to 10 years from now. It will be mobile devices."