Google Android Outsells Apple's iPhone for 1st Time

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Google's Android operating system outsold Apple in the first three months of 2010 to move into second place in the smartphone OS market, according to an NPD Group survey. Research in Motion, the Canadian company behind the BlackBerry, still leads with 36% of sales, ahead of Google (28%) and Apple's iPhone (21%).

It's important to acknowledge upfront that headlines like "Apple Outsold By Google!" are comparing apples to citrus fruits. The iPhone is Apple's only phone. There's only one species of Apple phone. Google's Android software runs across many phones, such as the Nexus One (the "Google Phone), Android and Android Eris. That makes Google more like a genus.

Remember when tech critics were calling Google's weak Nexus One sales a flop back in March? Today's news reminds us why those concerns were premature. Google is fundamentally an advertising-and-software company that dabbled in hardware. Apple is a hardware-and-software company that is moving into advertising. The two companies are converging in the mobile space from different directions, but the end game is the same. Higher market share in hardware and OS presages higher market share in the mobile advertising, the next frontier of the ad revenue wars. Market share in the OS market is a prelude to the mobile advertising battles that will heat up in the next decade.

In the same vein, it's too early to be triumphant about Google eclipsing iPhone sales. Worldwide, Apple commands 16% of the market, compared to Google's 7% (Q4 figures from Gartner).

(Full disclosure: I own a Google Android Eris, and I think it's awesome.)

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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