Android and iOS are destroying GOOG's core desktop searchword sponsored ad business. The biggest rivalry in tech today is not Apple vs. Google, but Google vs. Android. With every new Android activation, there are fewer eyeballs to click on Google's cash-cow sponsored ads on traditional desktop PCs from which Google still gets 96% of its revenues. It's ironic that Google actually owns Android which is killing Google itself (with Samsung as Android's #1 partner against Google). Android is a cancer on Google, and Google's continued promotion of Android is a form of masochistic suicide. But mobile's not going away, so Android will keep hacking away at Google's sponsored ad business until Google, as we know it, happily dies.
They already let it happen last quarter when Google missed its EPS estimate and fell $80 in a day. Google should just let Android die and do more advertising on iOS, from which Google gets far more advertising revenue anyway even though iOS's market share is much lower than Android's. It would have let Google transition its desktop ad business to mobile at a more measured and still profitable pace than what's happening in the current situation. Samsung probably knows Google plans to eventually shut down Android if x-phone and x-tablet don't pan out, so Samsung's pre-emptively focusing on Tizen now. Android is a financial cancer on Google, and Google needs to excise it now before its core ad revenues suffer anymore. A little side business like Google Glass, asteroid mining, or Android are fine, but once they start impacting Google's core ad revenues, then these non-core side businesses should be abandoned. Google Glass is also cool, except for the fact the display's even smaller than a smartphone's so there's even less space for Google's sponsored ads.