Blog Post

Should Google Kill the Nexus One?

Google (s goog) this morning postponed the launch of two Android handsets in China in a clear indication that the company’s rift with Beijing threatens its booming mobile business. Meanwhile, the Nexus One has seen lackluster sales amid widespread complaints of technical glitches. So with Android’s future in China uncertain, and problems mounting with Google’s decision to build and sell the ideal Android phone — the Nexus One —  is it too early to wonder whether Google will pull the plug on its flagship phone?

Google indefinitely pushed back the launch of two handsets slated to debut tomorrow from China Unicom, dramatically upping the ante in its high-profile showdown with the Chinese government. As Om noted last week, China accounts for more 638 million wireless users, and handset sales are expected to grow by 21 percent this year alone. And the market could be especially ripe for Android given its support by some key players in the region: members of Google’s Open Handset Alliance include operators China Mobile and China Telecom as well as Huawei and ZTE.

While a governmental crackdown could lead to versions of the open-source OS that are far less integrated with Google’s mobile apps, the escalating conflict means that Google will be unable to control the evolution of Android in China. And it surely closes the door on any potential Chinese sales of the Nexus One — throwing yet another roadblock at the struggling handset.

Google appears to have overreached in launching its own branded handset. The search giant was clearly unprepared to deal with the customer service issues that inevitably arise in the retailing business, and splashy headlines of customer backlash are tarnishing its highly respected brand.

The company has obviously overestimated demand for an “official” Google phone, selling just 20,000 handsets in the first week it was out, and its strategy of competing against its handset and carrier partners has limited upside and risks losing the widespread support that has fueled Android’s growth. It may be unfair to predict doom for a handset that came to market just two weeks ago, but it’s becoming clear that taking on the role of mobile retailer was a mistake for Google. It’s too early to predict that Google will kill the Nexus One, but it’s not too early to wonder whether it should.

44 Responses to “Should Google Kill the Nexus One?”

  1. I’m pretty sure they won’t kill the nexus 1. It would hurt their image in the public eye if they did….plus they don’t really seem to be having problems selling it do they?
    They’ll probably just come out with a few upgrades to fix the technical issue

    • DistortedLoop

      Actually, reports for the first week were that only 20,000 units were actively being used (per an analytics company) and many extrapolated that to mean only 20,000 were sold. Compared to first week sales of iPhones, Droids, and other popular devices, many proclaim the device to be a big failure sales-wise. Others, like myself, point out that there’s no advertising for the thing, even on Google’s own web page, beyond some banner ads on techy/geeky sites, so it’s almost as if Google isn’t trying to sell very many. I speculate they are keeping a low advertising profile while they test the waters of putting themselves into the distribution chain of actual physical things.

      I ordered a Nexus One yesterday in the early afternoon. I ordered several other products from Amazon and some other companies. The Google product is the only one that didn’t ship yesterday – though email this morning says it’s in FedEx hands already and will be here tomorrow.

  2. At first I wanted to purchase this phone but with technical support only via email I decided to purchased the Motorola instead and wait for the Android 2.1 update.

    I’m sorry but Google should have telephone support for the phone. No wonder they are not advertising on TV ans bill boards. Too many people would purchase it and have nowhere to phone for help or advice.

    Hey, I’m a big google fan. From there web apps, browser desktop, docs, analytics, local business search, windows app, maps and much more, I use them all. I was excited to hear about the Nexus One release.

    But there is no way I’m going to purchase a mobile phone when I cant get telephone support. I’ve been using mobile phones since 1995 and have never hear of such a silly idea.

    • Well, as a counterpoint, I’ve been using phones since 1995 too, and i’ve had to use telephone support ONCE in that time (last year, trying to get WindowMobile to receive MMS properly – it still doesn’t work right). I don’t see it as that big an issue.

      This feels almost like anearly release of the N1, before the marketing/support/carrier endorsement etc really gets going. It gives the early adopters their way to get the latest shiniest gadget, but maybe it’s not ready for the mainstream yet.

      Also, on a different note – in the UK the N1 truly is a fully unlocked, carrier independent phone ;-)

  3. I am a hardcore iPhone fan using it since July 2007 AND still n1 is just awesome and I am using it for the past week and haven’t been disappointed a bit

    N1 is a good device but needs apple style packaging including sales support n marketing

  4. Didn’t Stacey post a story saying that the real story is and not the Nexus One? I agree with that sentiment. With that in mind, I think the topic asks a silly question. It’s not about the Nexus One. It’s about Google trying to change the way American consumers buy phones. It will be interesting to see how Google does when it has multiple offerings with multiple carriers on its site.

    • DistortedLoop

      The thing is, Google hasn’t changed anything. You can already buy unlocked phones, you can already buy direct from manufacturers, etc., etc. Now, if they’d released the Nexus One with the ability to do either T-Mobile or AT&T with full 3G service, and no contracts, that would have changed things. As it is right now, you’re either locked to T-Mobile for 3G, or stuck with a disabled Edge only phone on AT&T.

      • Of course Google hasn’t changed anything. What did you think the company was going to do in a few weeks? Like I said in my original comment, it will be more interesting to see how things go when there are more phones and more carriers in Google’s store.

    • DistortedLoop

      But their current model doesn’t even attempt to change anything.

      I expected them to do something, anything at all, that actually looked different than the current way of doing business in the US wireless phone industry.

      They could have offered a truly unlocked, multiple carrier phone that offered buyers an opportunity to actually take a fully functional phone to any carrier they wanted.

      They could have offered a discounted phone that was subsidized through advertising.

      Of course it will be interesting to see what they do in the future, if anything that breaks the mold, but right now, despite your sentiment about the being the real interesting thing going on, there is nothing of interest. There is also nothing to suggest that they’ll be doing anything either. Look at what’s on the site right now, links to some day buy guess what, another locked phone that’s locked to Verizon. Big deal. Same old story.

      It will also be interesting to see what Apple does, and RIM, and Palm, and even maybe the government to break these consumer-raping wireless companies.

      What did you expect after all the hype, nothing? Well, that’s what we got.

      • I wasn’t really expecting anything too big. Google is completely new to selling consumer electronics.

        As for your thought on selling a multiple-carrier unlocked-phone, that’s not possible yet. The CDMA carriers do not have unlocked phones available. The GSM carriers use different 3G frequencies. What were you expecting here?

        Again, it’s too early to judge Google’s initiative. It could work well. It could fail spectacularly. Unlocked phones have never done well in America. I’m curious to see if Google can change that.

        As for the model not changing anything, I disagree somewhat. What other mobile OS companies sell their phones directly? Again, this ties into having more phones and carriers available, but the potential for change is there.

    • DistortedLoop

      Qualcomm’s got (at least in the works) a world-mode chip for multiple carrier use. Of course you can “unlock” a CDMA phone, the issue is getting Verizon or the likes to take your phone that they haven’t sold you and authorize the IMEI on their network (they require you to mail it to their labs for testing). Rumor has it the Nexus One already has the hardware to do both AT&T and T-Mobile, but I haven’t researched that at all.

      What other mobile OS company sells phones directly to customers…? A little company called Apple; maybe you’ve heard of them?

      This banter is pretty pointless. You’re cutting Google more slack than I am; that’s your prerogative. I am not impressed with it at this point. Whether that’s the presses fault, or Google’s, whose to say? For a company that wants to control the world’s information, they didn’t do much to squelch the rampant rumors and expectations floating around the weeks before the launch.

  5. The comment from the Google spokesperson says it all, “We are trying to be as open and transparent as possible through our online customer help forums.”

    If I paid $500 for a phone I want proper customer service. I don’t want to search help forums in the hope there’s an answer there. I have never received a response to emails sent to Android app support, not even an auto-response, so I think this is endemic to their whole business culture.

  6. Oh please don’t start going all linkbait on Gigaom. Please. This is nothing but as the question is silly – what, if something’s not a raging success in the first week and has some issues we should kill it? Have you ever worked in a startup?

    Google’s issues with the Nexus One are simple – 1) some level of technical problem (how many is hard to judge since the web amplifies things), 2) a customer service snafu, 3) online only sales and 4) No marketing. This is all down to Google not being a consumer product company – anyone who’s run a consumer product company could have pointed out these issues pre-launch with the exception of the technical problems. Of COURSE they’d need to have phone support and of COURSE they wouldn’t want to play the “no, you need to take to X about that, it’s not our issue” support card. And of COURSE they should have a phone like this in stores so people can go buy one now vs walking through some online process. And while the tech press buzzed about this and there was mainstream attention pre-launch, there’s no marketing support. I see Droid ads all over the place… heck I see ads for the Motorola Cliq – but nothing for the Nexus One.

    Combine all of this with the fact that, cool as it is, the phone isn’t revolutionary in anyway and that T-Mobile has other Android phones and that their existing customers can’t get this phone as an upgrade (it’s not even on their Android phones page for new customers)…. have I mentioned that Google isn’t a product company?

  7. Google pulling the plug on N1 is not an option for them, definitely not. High expectations did it in for GOOG.

    Hardware is still awesome and there is no competitor in that area, so software updates will keep it in shape.

    Google expecting people to move to a service-laden network (T-Mobile) in the US is pure stupidity though. They didn’t know they can’t pull an Apple that easily – not on T-Mo. Releasing it to support all major 3G frequencies (Penta-band, yes Sony Ericsson got them Pentas!) rather than just Verizon and T-Mo may would have painted a rosier picture.

    Get your act together GOOG, it is never too late but come Apple’s next gen iPhone, the end of N1 praises!

  8. Google should kill their sales strategy and let retailers carry the phone. They should also kill the ridiculous restrictions they put onto what plans are available with the phone. I’m an existing TMobile customer, and was greatly turned off to what they did to existing customers. So much that I will probably skip Android altogether and wait for the HD2.

  9. @Colin,

    I too would add that your assertion is very premature. Granted, there have been some technical issues with the Nexus One, but keep in mind that no one was aware of the Nexus One even 8 weeks ago. I’ve pointed out on GigaOM many times that marketing campaigns are measured over time, typically in months NOT days and weeks. That said, i’ve heard nothing but fantastic things about the Nexus One short of a few glitches. I’m an iPhone user, but am thinking about switching to either the Nexus One or possibly the Droid.

    My $.02,


  10. The Nexus will do just fine when it gets on Verizon. I am a Droid owner (which I am very pleased with BTW), I will look hard at getting the Nexus for my wife as I think she will like the form factor better than the Droid). Google has screwed up by rushing it out before it seemed to be ready, but I believe they will fix it. Even if they dump their online store and just let the carriers market the phone, I think the device itself will be fine. But they better hurry, as their is always something new around the corner…..

  11. What kind of journalism is this? What makes you an expert? The Nexus has been out a mere two weeks!!! The people I know who have it say it’s awesome! Personally, I think Google is just testing the waters and plans a bigger Verizon launch. I’m guessing Apple pays you guys…

  12. Pranav Natu

    I would like to read your view on…
    Would this back foot move in china trigger any strategy change for nexus one towards India(the next wide market)?


  13. You people are crazy. I bought the phone, I love it. It’s a fantastic bit of technology. You think they won’t be able to work with their partners to correct some simple software issues? I have none of these issues with my N1 personally, outside of the 3G/Edge switching issue. They will sell just fine, especially once the phone hits more carriers (a la Verizon). At least give it a few months before predicting doom and gloom, thanks.

    • DistortedLoop

      The 3G/EDGE switching issue doesn’t sound insignificant. Hopefully it is just a software glitch. It’s a real battery killer, isn’t it? If I recall correctly, some iPhone 3G[s] owners had the same issue, which was fixed with a quick OS update.

      The Nexus One is really tempting me to leave the iPhone ecosystem, but there’s still too many “doesn’t do” or at least “doesn’t do well” issues on the Android platform that are important to me that keep me from actually allowing the orders for it I’ve made to go uncancelled. Being on T-Mobile is also a problem for me.

      • The first couple days I had it, the battery died in 8 hours each day (killing unused apps with advanced task killer). I dimmed the display (it’s still plenty bright), and it lasts 12-14 hours with over half the battery left now.

        This is playing games, having gmail/gchat on the whole time, surfing, live wallpapers, pretty typical stuff.

        As long as you kill apps you aren’t using, the battery life is pretty good, def better than my 3GS.

        The display is stunning. Reading web pages is great, and the trackball has actually come in handy several occasions when nav links are too close together. Also works great for ROMs.

        Apps is the real issue imo, as iPhone blows Android out of the water, for obvious and overstated reasons. And I would certainly appreciate more multitouch apps, and native multitouch support.

      • Oh, the switching issue is definitely aggrevating. Edge crawls, 3G flies. I would certainly hope for a fix in the near future. If this goes on for months, then that’s another story.

    • DistortedLoop


      I meant the switching between Edge/3G was a battery drainer. That’s the theory anyways with iPhones in spotty areas..the constant upping of the power on the radio searching for a signal kills the battery.

      Apps, iTunes music/podcast sync, comptability, and of course T-Mobile coverage are my biggest concerns.

      I should just buy the darn thing and get it over with. I’ll never be satisfied until I try it for myself. ;-)