A new report reveals that Cyanogen Inc. is close to securing a deal on a fresh investment of $110 million, as more and more startup companies are looking to get its Android version of software into their smartphones. Though Microsoft (MSFT, Financial) showed their interest in investing in this new project initially, somehow the deal couldn’t take off. Wipro Ltd. (WIPRO, Financial), one of the leading IT companies of India, is probably among the investors in this new project. According to Wall Street Journal, Microsoft would remain a minority investor in Cyanogen Inc. with an investment of only $70 million. Market and industry experts believe that this new investment report could also turn out to be false. Let’s quickly find out what Cyanogen’s plans are with respect to improving the popularity of its operating system and how the company could achieve such a target plan in the long run.
Why is Cyanogen so valuable?
Cyanogen has mastered developing Andorid-based interface for smartphones, which enables its users to customize their content on a smartphone. Cyanogen is based on the Android Open Source project, designed to increase performance of Android-based ROMs presented by various companies such as Google (GOOG, Financial)(GOOGL, Financial), T-Mobile (TMUS, Financial), HTC (HTC, Financial), etc. Currently, Cyanogen provides four parallel and active versions of its software, which includes: CyanogenMod 10 (Android 4.1), 10.1 (Android 4.2), 10.2 (Android 4.3) and 11 (Android 4.4).
What's in it for Microsoft?
It is well known that Windows Phones have still not achieved a considerable market share due to tough competition presented by Android and iOS operating system based phones. So, it is possible that Microsoft could forge a commercial deal with Cyanogen to get its software on Cyanogen’s mobile operating system. Also, Cyanogen is trying to introduce its operating system in as many smartphones possible, thus a new source of funding would be required.
Cyanogen, the aftermarket Android software creator, is looking to make open source application Android the requirement of the day, thereby getting rid of Google's domination in the Android phone market. To achieve this objective, Cyanogen has approached companies who share the same objective such as Microsoft, Amazon (AMZN, Financial) and Yahoo!Ă‚ (YHOO, Financial). None of these companies have made any official statement so far, since many of them use Google services such as Gmail, Google Playstore, etc.
It won’t be an easy road as CyanogenMod, the aftermarket Android version of Cyanogen, is still much dependent on Google services. Only Microsoft looks to be in this position to challenge the Google hegemony, since other companies are in constant fear of reprisal from Google, which is in charge of Google services other than Android. So, it can’t be denied that Microsoft might lock a deal with Cyanogen in the very near future.
Concluding thoughts
Cyanogen has already struck a deal with the Indian phone manufacturer Micromax, which would now be using CyanogenMod software on their new line of smartphones. According to Droid Life, Micromax holds a large market share –Â almost equal to that of Samsung (SSNLF, Financial) in the Indian smartphone market. Last year in a press conference, Kirt McMaster, Cyanogen’s CEO, confirmed that they are in conversation with many potential partners. Though he did not mention any particular name, he did hint that these potential partners were well known software and hardware manufacturers. Cynogen’s dream of decoupling Android from Google and making it open source will depend more upon how many mobile manufacturers are supporting this adventure. It will be interesting to see what Cyanogen has planned in the next few years, and how Google and other technology giants respond to these plans.
