Google Dumping its Online Nexus One Sales Model

| News

Google is abandoning its online store for selling the Nexus One smartphone in favor of the traditional in-store sales model. The Internet search giant launched its Web-based store for selling its own Android-based smartphone in January, but the site hasn’t been as successful as the company expected.

“As with every innovation, some parts worked better than others. While the global adoption of the Android platform has exceeded our expectations, the web store has not,” said Google vice president of engineering Andy Rubin. “It’s remained a niche channel for early adopters, but it’s clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to chose from.”

The Nexus One isn’t, however, riding off into the sunset. Instead, Google plans to sell its smartphone through traditional retail channels world-wide. In comparison, Apple’s iPhone has been available online as well as in retail stores ever since it was first introduced.

“Once we have increased the availability of Nexus One devices in stores, we’ll stop selling handsets via the web store, and will instead use it as an online store window to showcase a variety of Android phones available globally,” Mr. Rubin said.

The move could help increase Nexus One sales since more people will have an opportunity to try the phone out before buying. If so, competition between Google and Apple in the smartphone market could heat up more.


Bosco (Brad Hutchings)

Carriers still rule this game in the US. They want model exclusivity and inter-carrier incompatibility to increase the expense of customers switching carriers. Those account for about 1/2 of the exit costs, while multi-phone bundling (family plans) account for the other 1/2. It’s why you won’t see iPhone on Verizon or Sprint anytime soon. It’s why AT&T will resist having a full-featured Android phone in its line-up. The current offering (MOTO Backflip) has a subset of the Marketplace and doesn’t allow sideloading without rooting. It also runs Android 1.5.

Google dared to ask the question of whether people would pay about $700 for a phone and docks. It’s a beautiful phone. Worth every penny. But the phone maker is not the alpha dog of the business. The carrier is. There’s a lesson for Apple here too.


You know, when I read the headline I thought “Wow, that’s rather old news.”

Three days in the information age is an eternity.

Any ways, the reason why I didn’t buy the Nexus One was because it had a laughably small internal storage, I will not buy an Android device that has less than 8 Gigabytes of internal storage for Apps (atleast not until Apps2SD gets incorporated into Android).


At first the iPhone could only be purchased at AT&T or Apple Store, right?  It was a while before it became available to purchase online, I thought…


A key ingredient to the success of the iPhone was the fact that Apple was the alpha dog and not the carrier. Learning from the ROKR disaster, Apple dictated how the iPhone was going to work and got AT&T to make concessions on their control of the device and how it worked with AT&T’s infrastructure. 

The results speak for themselves, the iPhone is a runaway success and single-handedly pushed smartphones ahead by several years while AT&T gained many subscribers. 

An important lesson here was that Apple gave users a lot more than the carriers were giving them before.  The initial iPhone’s data plan was a bargain compared to other Internet-accessible phones at the time.  And Apple didn’t nickel-and-dime customers nearly as much as the carriers did before. 

Apple’s motives were hardly altrustic though and they’re still more restrictive than some people like.  But Apple took advantage of the carrier’s excessive greed by offering users a phone environment that offered much more freedom than they had before.  The carriers had their day but now they all trip over themselves to bow down to Apple in order to sell the iPhone. 

Now it’s up to someone else to figure out how to improve upon the iPhone (and the whole iTMS/Mac digital hub ecosystem) if they want to be the next alpha dog.

Google’s mistake was that they offered a slick phone that had little buzz about it outside of the techie community and doesn’t signficantly advance upon the iPhone or Droid.  Everyone wants an iPhone because they’ve seen their friends with one.  Most people have no idea what the Nexus One is, so it’s understandable that it’s online sales were so low.

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