When Google started selling its Nexus One android phone earlier this year, it raised many issues. Was Google now competing with people it depends upon for distribution? Would consumers buy from an online-only store? To the latter, apparently no. Google’s closing its shop, and perhaps never offering another Google-backed device in the future.
While the global adoption of the Android platform has exceeded our expectations, the web store has not. 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.
So today we’re announcing the following changes:
More retail availability. As we make Nexus One available in more countries we’ll follow the same model we’ve adopted in Europe, where we’re working with partners to offer Nexus One to consumers through existing retail channels. We’ll shift to a similar model globally.
From retail to viewing. 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.
Direct sales clearly hasn’t worked. More stunning, Google’s not even trying to revive the model at all. After about five months, it’s just giving up.
The move conveniently deals with another, bigger issue. The Nexus One made a lot of Google partners nervous. For example, Verizon had just unleashed an expensive advertising campaign to push its “Droid” phones as the latest and greatest in Android only to have Google put out the Nexus One as something better. Other handset makers had to wonder whether Google would try to undercut their own devices with a “Google-own” device. One of those makers was Apple, which within the space of a year has gone from best friends with Google to arch-rival, with the Nexus One part of the breaking point.
The change also makes me wonder if that’s it for Google doing devices. The company once had suggested it would never do its own phones. It later tried to spin that as a “we’re still not building hardware” type of thing. But now it seems likely that there won’t be a Nexus Two nor things like an Android-tablet coming directly from Google, not after the conflicts the Nexus One raised.
Then again, Google still has scores of developers such as those coming to next week’s Google I/O event. Last year, they were all provided with a special Google-backed developers edition Android phone. Meanwhile, Google has employees where it may wish to test particular hardware devices and configurations. Maybe the occasional Google-own device will come out and make it through retail channels to consumers.
Postscript: I asked Google if this meant Nexus Ones would also no longer be produced in the future and if it was out of building Google-own products. Here’s what I received:
Today’s announcement doesn’t have any impact on N1 production. It’s just about distribution.
As for the future: We will continue working with our partners to bring cutting-edge new Android handsets to market, but we have nothing to announce right now.
Google also said they’re not ruling out the possibility of Google-branded products.
Postscript from Greg Sterling: The Nexus One was particularly frustrating to Motorola, which despite public statements that everything was fine, made a number of moves to declare its independence from Google. Among them were forming an alliance with Bing (in China and beyond) and essentially replacing Google’s core location services with those from Skyhook Wireless. This sort of reaction, together with the relatively modest sales for the Nexus One, made the calculus relatively easy for Google I would imagine.
In addition both Verizon (one of the launch partners) and Sprint declined to support the Nexus One, for undisclosed reasons. Instead they’re offering alternative Android models.
Danny says above that it’s unlikely there will be a Google-branded tablet. Verizon and Google are apparently “collaborating” on one to counter AT&T and the iPad. What we’re likely to see however is branding similar to what has existed to date on Android phones other than the Nexus One: “With Google.”