Acer was scheduled to announce a smartphone for China that runs on Aliyum, which was developed by Alibaba, the large Chinese e-commerce outfit. The press were eagerly waiting outside  by the doors for the Shanghai press conference hosted by both companies to start, but were disappointed. At the last minute, the Acer CloudMobile A800 launch was unfortunately canceled and the reporters were told to go home. Was there a power outage or an unexpected swarm of locusts? Nope. Google showed its muscle and threatened to pull the plug on Acer’s Android license if the company went through with the launch.

The Alibaba Cloud Computing unit that created Aliyum released a statement saying,

“Our partner received notification from Google that if the new product launch with Aliyun went ahead, Google would terminate Android product cooperation and related technical authorization with Acer.”

Android is open source and free, but device makers must meet Google’s requirements to use services such as Google search or the maps that are expected on Android devices. An Acer official, who was not named, told the Wall Street Journal that Google was “concerned about Acer’s user of Aliyum,” but he would not give out any specific information. He went on to say, “Acer will continue to communicate with Google and the company still wants to launch the new smartphone based on Alibaba’s software.”

According to reports, Acer has been under pressure for months with its PC’s and this year, China may possibly become the world’s largest smartphone market. Acer only makes up only a small portion of the smartphone market and most the models run on Android. So what’s stopping them? Possibly the competition from Google-owned Motorola Mobility, as well as the legal problems Samsung has been in.

Other Aliyum models were supposed to be released later this year and next year, and the Journal says that the Aliyum phones have become more popular in China and will soon be gaining more distribution.