[citation][nom]alextheblue[/nom]If it's open source, why couldn't they build an OS on it? Not saying that they did, but even if they did so what? Just like Android is built on Linux, or Amazon has their own fork of Android.
The biggest issue is the app store and apps. Google doesn't want anyone messing with their market or revenue.[/citation]
The OS is being shipped with the Android Store and some Android APKs (probably not all open-source like the base OS is) and even if they're open-source, it can still be illegal to use them in such a way. For example, Red Hat, like all other versions of Linux, is open source, yet it is also proprietary and it's illegal to use it commercially without proper licensing. Being open source and being legal to use the entirety of it as you want to are not necessarily one and the same. For example, although there's probably nothing wrong with making custom Android ROMs, but using Android code to make you're own OS that you commercially use to compete against Android probably isn't legal.