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Tuesday, May 29, 2012

Report: Android a Loss Leader for Google in 2010

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Google's Android operating system may be one of the great success stories in tech, but the search giant apparently lost money with its mobile platform in 2010, according to Reuters.

The company's "big loss" for Android several years ago was revealed by a federal judge overseeing a jury trial between Google and Oracle over the use of Java software code to create the Linux-based software platform used in smartphones, tablets, and other mobile devices.

U.S. District Judge William Alsup on Thursday read portions of a sealed document containing profit and loss numbers for Android in a San Francisco courtroom. A jury is deliberating the first phase of the trial, which concerns Oracle's charge that Google violated copyright restrictions when it used Java to build Android.

The judge did not reveal specific financial figures for Android, but did note that it lost money—apparently a lot of it and in all four quarters of 2010.

"That adds up to a big loss for the whole year," Alsup said, according to Reuters. Google's Android revenues for 2010 were about $97.7 million, the news agency reported.

Alsup "quizzed attorneys for both companies about some of the Android financial information submitted in the case" outside of the jury's hearing on Thursday and sealed the document containing Google's internal financials for the mobile software platform. Google is a public company but does not break out specific numbers for Android when reporting earnings to investors.

Lawyers for Google and Oracle gave closing arguments earlier this week. At stake in the trial is Oracle's claim that Google copied its Java code without obtaining a proper license to create Android. Google claims its use of Java APIs and libraries falls within the guidelines for fair use of free and open software code.

The closing arguments mark the end of the first phase of the trial, which covered alleged copyright infringement by Google. Following jury deliberations that Alsup said could take up to a week, the two companies will contest Oracle's claims regarding alleged patent violations by Google.

The trial saw Oracle chief executive Larry Ellison and Google chief executive Larry Page take the stand last month, while Android chief Andy Rubin, former Sun Microsystems chief executive Jonathan Schwartz, and Oracle chief financial officer Safra Catz were among the other high-profile names giving testimony in recent weeks.

For more from Damon, follow him on Twitter @dpoeter.

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