In an interview at CES 2012, Google’s Chairman Eric Schmidt claimed that there is differentiation between various Android devices and not fragmentation. PC Mag posted excerpt of the interview in which Schmidt took issue with fragmentation argument.

"Differentiation is positive, fragmentation is negative," Schmidt said during an appearance here at the Consumer Electronics Show. "Differentiation means that you have a choice and the people who are making the phones, they're going to compete on their view of innovation, and they're going to try and convince you that theirs is better than somebody else. Fragmentation, however, means that you have an app and it runs on one device but not the other.”

Schmidt is basically trying to put a positive spin on the Android fragmentation problem by playing with words. It would have been “differentiation” if all the new Android phones coming to the market were based on Android 4.0 with different UIs from various manufacturers, but most of the upcoming Android phones will still run on Android 2.3 and some will even use 18 month old Android 2.2. And if we talk about phones that are being sold right now you can get anything from Android 2.1 to Android 4.0, that's pure fragmentation…