Android Returns Cost Carriers $2 Billion Annually - InformationWeek

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12:28 AM
Ed Hansberry
Ed Hansberry

Android Returns Cost Carriers $2 Billion Annually

High rates of Android hardware problems are costing carriers; platform fragmentation is considered the culprit.

In only three years, Android has gone from being nonexistent to becoming the dominant platform, surpassing iOS and BlackBerry in recent months. The platform has had a rocky road on the product development front, as a number of lawsuits have been filed against device makers. That has added a substantial expense to a platform that costs nothing to acquire and use.

Now comes a report that once the devices are sold, carriers are incurring additional, higher-than-expected charges, in the form of up to $2 billion per year for returns and repairs due to hardware issues.

Wireless "experience management" firm WDS released the results of its study of over 600,000 tech support calls to operators. The number one issue cited was hardware problems with Android phones, a problem escalated by platform fragmentation. Android hardware issues made up 14% of the call volume, which is double the rate for iPhone's iOS platform. BlackBerry had an even lower rate than iOS, at 6%.

Apple and RIM have fully integrated ecosystems. The hardware and software, including drivers, are written and designed by the same company. Android, on the other hand, is the complete opposite. First you have a platform written by Google. Then you have dozens of manufacturers that not only make different handsets, they also modify the base platform to suit their needs. This is magnified by multiple versions of Android to start with. Today, Honeycomb makes up about 30% of the Android market, Froyo about 45%, and Eclair about 25%.

Android is fully open. Google has little or no say in what hardware makers do with the platform, and this may be the reason why hardware issues are so high. Microsoft's Windows Phone also has multiple manufacturers, but it has much tighter restrictions in the licensing agreement on what can and cannot be done by device makers. This set of rules keeps its failure rate lower than Android, though not as low as the integrated platforms like iOS and BlackBerry.

This higher hardware fault rate translates directly into returns. Software issues can often be fixed over the phone with the worst case scenario being a user has to perform a hard reset that wipes all data from the phone and restore it to factory defaults. Once a hardware issue happens, though, it involves a repair or return, and that costs far more than a phone call.

A number of hardware issues were tracked, including the microphone, camera, speaker, casing, battery, and display. While Android didn't have the worst performance in every category, it tended to be on the higher end of the spectrum in failures. Notable exceptions were speaker issues, where Apple iOS had the worst performance by far; button issues, where BlackBerry was the runaway champ; and displays, where Windows Phones were far more prone to failure.

Much digital ink has been spilled on platform fragmentation for Android and the problems it causes for developers. It now appears that it has a measurable cost for carriers, as well. It is doubtful this issue will change much in the way of device sales, but carriers now have a more realistic view of the true cost of the platform. That could impact marketing dollars and device pricing in the future.

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Jay H
Jay H,
User Rank: Apprentice
11/7/2011 | 5:50:00 PM
re: Android Returns Cost Carriers $2 Billion Annually
Well, considering my family has each gone through at least 2-3 warranty replacements over the lives of our respective Android phones, this article makes sense. Even worse, usually when we've swapped a broken Android phone, they gave us another broken one in return. For example, we swapped a Droid with a faulty touchscreen and they gave us a "certified" refurb with a broken camera. I'm sure that adds to the returns mentioned in this blog. And the system is indeed "fragmented". Look at the scores of Android phones from numerous manufacturers (compared to only five different iPhone versions released over an even longer period): G1, Touch, Hero, Moment, Click, Droid, Eris, Nexxus, Incredible, Droid 2, Droid X, Galaxy 1 & 2, Droid Razr, Droid Bionic, Atrix, Nexxus2 (and dozens that I left off due to space/time constraints).... Now, factor in all the different OS versions that don't work with every phone listed (or some Android tablets): Cupcake, Donut, Eclair, Froyo, Gingerbread, Honeycomb, Ice Cream Sandwich (and the incremental steps in between)... The fact is, Android is a convoluted fragmented mess of system. They have ten million cooks in the kitchen and the soup tastes lousy. I finally bought an iPhone after initially vowing to never buy one. Love it or hate it, it seems so much more solid and complete than every Droid I've owned or seen. Sure Apple has its flaws, but Apple usually quickly fixes them. They (like most other companies) aren't quick to admit failures, but take the case for of antennagate for example. They finally admited a flaw and took action. They also acknowledged an iOS5 battery issue and vowed a fix (although I got 3 days of battery on my new 4S despite heavy useage). I'll take easily fixable flaws over blatant denail and ignorance any day. For example, despite swaps, complaints upgrades, etc, I still never got an explanation why my Android icons routinely disappeared despite numerous battery pulls, full erase/resets, not installing any apps in addition to factory installed, etc. Although my Droid started out okay, subsequent Android OS updates rendered it all but useless in under a year! I gave Android more than a fair shake, so I feel totally justified in singing the praises of iPhone and now vowing to never buy Android again.
User Rank: Apprentice
11/3/2011 | 8:11:09 PM
re: Android Returns Cost Carriers $2 Billion Annually
I do not disagree that with diversity (your word is fragmenation), comes some amount of expense.
Oh, and by the way, do you have final numbers on the cost of the iPhone bumper required to fix the Antennae problems ?
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