Google released a beta version of the software development kit for its Android mobile operating system earlier today to much fanfare, but in the rush of breaking the news we only just got a chance to examine the details.

There have been some puzzling changes, like the removal of an API for Bluetooth compatibility, but you shouldn’t draw too many conclusions from this beta release as it doesn’t really reflect the current status of the Android SDK in features or stability. What matters for developers is that this release is “API-stable,” which means that an application built for this SDK will not have to be changed substantially to run on the final build, which will be used for the first phones. Overall we’re quite impressed with the Google’s work; the new SDK seems to have some compelling advantages over the SDK for Apple’s iPhone.

As we noted before, during the first phase of the project, the real focus of the Android team is to manage the development requests of the Open Handset Alliance — not small-time developers. Google understands that it needs to make the mobile operators and handset makers happy in its new ecosystem. Early indicators show some success. Mobile operator T-Mobile was already happy enough to kill the industry’s holy “on-deck” cow and move to a yet-undefined app store model.
From that view, the release reflects a new stage in the negotiations. Now is the point when early startups and other third-party developers can seriously think about getting into Android development, because API stability is guaranteed and Google has provided a roadmap that spells out where the development is heading.
What has been added

In terms of features, the new Android SDK features a completely new “Home” screen which feels like a real desktop because of the ability to add application icons and folders (both built-in and newly added applications), shortcuts (e.g. bookmarks, contacts, music playlist and folders), widgets (which are powered by Google gears for mobile) and the ability to change your desktop background. One feature that really shines is the ability to have a wide home screen that actually spans several screens; you can move to the next screen with the tip of your finger. It allows you to group several shortcuts on each screen (e.g. important contacts on one screen and important apps on the other). It includes the Google streetview shown at the Google I/O and a lot of nifty improvements here and there.

Here’s the applications screen with the transparent desktop behind:

And here’s a screenshot showing how applications can be added to the desktop:

In business terms, it’s great that messaging (for SMS/MMS conversations) has been added to the 0.9 beta. Mobile operators have been very displeased with Apple’s MMS policy. MMS, short for multimedia messaging system, lets users send pictures, short clips and sounds from one phone owner to another. In 2008, this business will cause a revenue of more than $20 billion worldwide, according to the reports we’ve seen. Operators have spent a ton of money in the last years advocating MMS use and have been asking Apple to enable MMS for the launch of the 3G iPhone. Enabling MMS bodes well for many business models who rely on user-generated content like Mobile Social Networks.
This time around, these two features have been removed, the GTalkService and the Bluetooth API. While dropping the GTalkService may be understandable for the mobile operators — they don’t want people using Gtalk to make calls instead of their own telephony services — the real bummer seems to be the loss of the Bluetooth API.
I know a variety of startups, for example in the voice search segment, who count on Bluetooth headsets in their model. Also, I wonder about business models who want to transfer data seamlessly via Bluetooth. I assume that promoting mobile search is one of Google’s main interests, so it will be interesting to hear the reasoning behind this removal.
In my opinion, the most important business question, as we go now from beta 0.9 to next releases, is related to mobile advertising/targeting. Mobile as a gadget continues to fascinate marketeers as it has some has unique characteristics, like location. All these factors have the promise of better contextual and behavioural targeting and in the end, in terms of numbers, higher clickthrough rates than online targeting. So there is promising playing ground for applications built on all the possibilities which Android provides. A large chunk of mobile advertising’s promise is tied to the hope that somebody creates a working system that grants satisfactory access to this data for interested parties. Could that somebody be Google Android?