Wednesday, January 6, 2010

Was the Google Nexus One Announcement Really About Another Google Android Phone or iPhone Killer?

Was the biggest Google announcement really about another Google Android phone or the iPhone killer as some have suggested? As expected, Google announced its Google Android Nexus One at a press conference Tuesday morning.

Nexus One is a new Google Android phone that offers software internals designed by Google and the device hardware is manufactured by HTC. According to Google's Mario Queiroz, the Nexus One is a "super phone" where the Web meets the cell phone. "It's an example of what mobile phones can do with Android" says Mario. It is indeed slim, sleek, and light-weight (4.58 oz). It offers a 1 GHz Snapdragon processor. The primary interface is a 3.7 inch AMOLED display with five customizable home screens. It runs the Android 2.1 OS and the WVGA display is capable of displaying 3G graphics.

According to Google's Senior Product Manager for the Nexus One, Erick Tseng, the feature set includes everything you'd expect from an Android phone and adds a couple of unique goodies.

The Nexus One may or may not be an iPhone killer, but it doesn't really matter as the biggest Google announcement was not really about another Google Android phone. The real news at the Google event was about its online store at - the news that could shake up the mobile industry as it had happened during the initial iPhone announcement.  The real news was about an online storefront offering that, if successful, could revolutionize the much reviled US carrier model - offering much faster, cheaper and more flexible services for mobile users. So what is really the significance of the Google announcement?

Well, Google confirmed that Nexus One, and all subsequent Google phones sold via the company's online store will be available unlocked for use on every participating carrier. By offering a lineup of phones that is essentially carrier-independent (with the radio compatibility caveat), Google has broken the two previously interlocked parts of the phone/plan-buying—phone selection and carrier selection—and has done so in a way that threatens one of the most important enablers of carrier lock-in.

In short, what Google announced today wasn't just the Nexus One, but the world's first carrier-independent smartphone store; the Google store is now the only smartphone store in the US where, for every phone on offer, you first pick which phone you want, and then you pick a network and a plan on that network. So you can comparison shop among networks based purely on plan price and network quality, because you already have your phone picked out.


Anonymous said...

"world's first carrier-independent smartphone store"

Unless I've misunderstood something, I think you've extrapolated from "US" to "world" a bit quickly here.

Tens of millions of phones are sold around the world every year by "carrier-independent" stores. In the UK "Carphone Warehouse" and "Phones4U" are the biggest. Similar stores exist in most other European and Asian counties.

Also - the failure of the retail phone model in the US is simply due to consumers being unwilling to pay the full price for their handsets. The subsidies paid by the carriers are more attractive than the downside of carrier lock-in for most people. Will the Google store change that? I don't really see why/how other than perhaps a tiny % of consumers.

Tasneem Sayeed said...

Thanks for your comments.
"First carrier-independent smartphone store" or not, what Google is trying to do is nothing less than reinventing the way mobile phones are sold in the US and possibly some other parts of the world. It is bringing a huge chunk of open phones making them available exclusively via open application stores sold through a variety of open channels running an open source operating system. And this is no small measure.

Tasneem Sayeed said...

"Can Google change the mobile business model in the US?"
Could anyone have predicted 5 years ago that Apple would revolutionize the mobile industry with the introduction of the iPhone? Well, if Google is successful, there will probably be increased competition among carriers on price and quality, which will allow consumers to buy cheaper handsets with better quality and better services.