Not a good omen for the future of Google’s Nexus One smartphone or Google’s big idea to sell phones directly to consumers: the company is now suggesting that people waiting for the phone to come to the Verizon Wireless network purchase HTC’s Droid Incredible instead, which it describes as a “powerful new Android phone and a cousin of the Nexus One that is similarly feature-packed.”
Both companies are trying to downplay the implications, with Google (NSDQ: GOOG) telling Bloomberg it made the decision because of the “amazing innovation happening across the open Android ecosystem” and Verizon saying, “If they want to do business with us or sell the device, we’re open to that.”
But, because Verizon’s network is so large, many commenters believe Google may be losing its best hope at cutting into the iPhone’s dominance. Already, sales of the phone — which is being sold directly to consumers by Google — had lagged those of the iPhone and Droid during their first months on the market.
Google’s decision to direct consumers to a phone sold directly from Verizon Wireless vs. buying one directly from them without a subsidy also puts into question whether Google can be successful at selling phones for full price without the carriers help. While so-called unlocked phones have fared better in Europe, the model has not taken off in the U.S., where carriers have largely trained consumers to believe phones can be cheap, or heavily discounted.
When the phone launched in January, Google said it would be available at first with a two-year contract from T-Mobile, with similar options from Verizon in the U.S. and Vodafone (NYSE: VOD) in Europe to follow. The Vodafone option is still on, with Google saying that Vodafone will start distributing the phone this Friday. Sprint (NYSE: S) said last month that a version of the Nexus One would be available for its network “soon” as well.

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