Verizon Could’ve Helped Nexus One Sales, Google Said No

Written by: Gundeep Hora on 3/21/10  |  Filed Under Mobile  |  Share    

Until we found out that Google Nexus One was not going to hit Verizon retail stores, we were excited to see how the largest US carrier would help propel sales for the Nexus One for Google. With 80M subscribers, it surely would’ve helped. However, thanks to Google’s arrogance in its model, Verizon will not be selling the Nexus One on its own. It will continue to let Google sell the device online through its retail store.

With the way Nexus One sales have gone so far, it would make sense for Google to play by the rules every once in a while. As great as it is that we can purchase smartphones online without carrier input and start using them instantaneously, does Google not realize there’s a reason why we still have retail carrier stores? It’s because before spending hundreds of dollars on a device that we’ll carry with us everywhere we go, we prefer to play with it to get a sense of how much we’d enjoy using it. That holds especially true for users who are not used to technology and need a sense of safety before opting for the more popular option. Besides, it’s free marketing at a place at the end of the buying funnel where the user is ready to spend.

With its miserable sales online so far, having the Nexus One on all four major carriers in the US is a great strategy, but let’s stop kidding ourselves and expect users to pay an unsubsidized price for a phone when they are not used to. Why would anyone pay for a Nexus One when they can get an iPhone 3GS for $200 and be part of the hip crowd at a much cheaper price in the short-term? As we all know, the lifetime cost of a 2-year plan is hardly a consideration when we are set on purchasing the device that we’ve always wanted.

Apple has that aura, Google doesn’t. Why wouldn’t Google help itself and move more units in the market and get the halo effect going around Android? The more people we have in the market using Android phones, the more others will become interested after seeing so many people using a certain device. That’s really how the iPhone became successful, and of course, Apple’s genius marketing play was at hand as well. Get everyone hooked on a platform and selling to others will become much easier.

Verizon would’ve helped with that tremendously, but no, Google is much more interested in cutting out carriers and doing everything on its own. Clearly, their sales prove how successful that model has been. They want to disrupt the industry, we say go for it, but let’s not try to disrupt two at the same time because it may be a disaster. Get Android going with the help of carriers, then start cutting them out when consumers can reliably call Google a hardware company.

Having Verizon behind the Nexus One would’ve moved a lot of units, but Google is clearly not interested in selling too many of them, or they would’ve negotiated deals with all four carriers. Imagine T-Mobile, Sprint, Verizon and AT&T all promoting the Nexus One. Sales would’ve gone through the roof, and the Nexus One would’ve actually been considered successful by industry watchers. Good job, Google, on a major goof up!

Tagged as: , , , ,

Other related articles:

  • chris
    uhhhh i dunno why this article even exists...google nexus one IS coming out for verizon this month...it even says it on the goole website? so yeah this article is bull**** plus i work there
  • joseph_b
    Sounds like an article written by someone who can't get what he wants; a subsidized GN1 (Google Nexus One). Google maybe on to something here because I feel that 'want' as well. There's 2 things that could happen: (1) wait for the iPhone market to become saturated so it isn't as hip anymore, then they come in with a new GN1 or (2) become a provider themselves and that would really disrupt the industry.
  • Dale
    I'd be all giddy about (2), except even if they did that, it would take forever to get off the ground and have the kind of coverage and service that the major providers have. Besides, there's no guarantee that Google's wireless network would be significantly cheaper. Remember, all these companies are greedy, I agree. But I also know they're heavily bogged down with FCC and other federal/international regulations.
  • Draeve
    why is it that everytime there is discussion of "how much the phone cost " we forget that the "carrier " charges the same monthly fee whether we bought the phone up front or got it at "subsidized ' price from the carrier - to me the 2 year contract is a no brainer - I like the carrier I signed up with and they ar e giving me a phone for less than half price . . . where is my N1 for Verizon ????
    DJ
  • I don't care where its being sold, whenever the nexus one comes to the verizon network, its going to sell a lot more units
  • Dale
    This is why, as I suggested on Google's Nexus forum and elsewhere, that Google ought to open up their own stores (or, since they only have one hardware product right now, at least kiosks in shopping malls) to show off and sell their product. This would be the best of all worlds, since people could get hands-on with the Nexus but still not be tied to a carrier with a contract. The phone needs to be universal, working with all cell phone technologies (GSM, CDMA, etc.). And the phone needs to be offered ONLY as unlocked, but the unlocked price needs to come down, way down ($200 - $300 tops), especially since it's reported that the phone only costs $175 to make. If Google did these things, and ONLY if they did these things, they would truly change the telecom industry forever.
  • Googling
    Google will change the way the industry does business one step at a time. Google is full of smart people and makes smart decisions. Maybe we don't understand it now, but soon it will become clear. The article was harsh and i do not agree with, like many people who read it. Its almost as if you knew for a fact what Google's strategy is.
  • James
    Not sure Google CARES if they sell 1 million phones or 10 million in 2010. The point is to spur other manufacturers to stop shipping Android 1.5/1.6 phones, and it's working.

    Also the subsidized phone model has to go away, I hope the N1 stays unsubsidized as much as possible.
  • Zohrab
    Its not arrogance. You are missing the entire point that Google is trying to make (in my opinion). I many countries throughout Europe (I know because I am from one of those countries) people buy their phone of choice and then they get that phone activated from the carrier of their choice. Pretty much exactly how we buy land line phones. Imagine how pissed off you would be if you wanted to sign up your tv service with Dish Network and they told you that you can buy only certain type of tv's and you can only buy them from us.

    I believe that Google is trying to make a point that us, the consumers, should not be OK with the kind of business model that US carriers have been using. Yes they would sell more phones if they went with Verizon but I admire Google more now because they are not bending backwards for profits.
  • Viraj
    Gundeep,
    I really do not think that Google is planning on roof topping sales here. It is on a learning loop quite like Apple's first phone (With Motorola). I do not remember its name, which speaks for itself. For the lack of a batter word, it was like a sounding device, the inputs from that piece of crap went into what we know as IPhone. To me that is what the N1 is - a sounding device. They never pushed this device, because that was not the intent - they are just fixing their processes, software and hardware using inputs from this device. Google is just filling its gaps using this like a BETA and checking how the phone companies react, so that they can fine tune their strategy for the biggest bang.

    So rather than jumping to the most obvious conclusion, think beyond. Do mark Steve Jobs words - "They are out to get us" ... he did not say a word about the fact that N1 was a failure, because he knows that this was just the initial Salvo (pretty good one at that) and there is more coming.

    BTW, just to suggest impartiality, I have both an Iphone GS (office) and a N1 (personal), and while I have no qualms in suggesting who the winner is ... it is N1 hands down. I do believe that Apple can come and take the lead back with 4G, such is the nature of this job and these 2 companies.
  • TheForsakenKnight
    Bravo! Gundeep Hora. Bravo! You have spoken the exact same words that I have wanted to say. Good Job Google, on this major goof up!
  • Josh
    Google is a long term company. The Nexus One, just like the G1, is their handcrafted, shining example of what CAN be done. They'll leave it up to the manufacturers they've partnered with to make the massive sales (i.e. Moto Droid, HTC Hero, and now, every phone based on the Nexus One "superphone" platform). They are making a stand against the terrible interactions with carriers and not being able to reliably buy phones online, along with carrier lock in. The N1 is ahead of it's time for most people, but it fits right at home with the same kind of people that would order a laptop online without touching it. Now, for those of us ready to accept it, getting a phone is as easy as buying a book from Amazon or a laptop from Newegg. Eventually, this will be the status quo, and Google will be in a great position, while the carriers desperately try to hold onto their old business models.
  • I like this. I can see this being part of Google's long-term strategy.
  • Newsflash. All that hardware in the nexus can just as easily be plopped into another no-name phone crapped out by HTC et all. It's not like this was some huge expenditure that is awash. Clearly everyone is aware the masses aren't going to buy something they would use daily without giving it a brief hands-on, so it should be common knowledge this nexus experiment has specific goals envisioned which apparently do not include cutting into profits all the carriers (presumably due to the restrictions such a contract would constrict upon bringing this "vision" to fruition). My two cents.
  • Interesting perspective. You're right about the vanilla hardware in the Nexus One. What other goals could Google have in mind?
  • justanotherjon
    if anyone reads this it might be a good thing they didn't sign on to all four right away.

    If you were to go back to January and buy a nexus one, it would have a few issues with it that it would not have now. Now imagine, if you will, all of the prospective buyers from all four of the major carriers if Google had made this move, and almost instantly there would be thousands of confused people who thought they bought a non problematic phone, with a non problematic software base.

    The general public does not understand software development, they just want the hottest phone and they want it now.

    think about how people responded to the DROID, would Google want that if they signed to the Big Four?
  • There's nothing wrong with that. Products aren't perfect, and companies make mistakes. The Nexus One issues were software-related and could've been fixed with an auto-update sent to everyone's phones.
  • spoonman
    All the talk about N1 is free advertising for the Android OS which if it continues selling at its current pace Android will out sell everyone else. Google has a good thing going.
  • I'm not saying Google doesn't have a good thing going. Of course it does. However, it would've been great to see the Nexus One on all four carriers with Google trying to sell as many as they possibly could. Right out of the gate, Google could've been a strong hardware company in terms of sales.
  • Mike
    The thing is, google obviously isnt going for tremendous up-front sales. if it were the case, they wouldnt be using this sales model in the first place. Google's trying to prove something. Apple merely created a fad. they put out a product with their name on it, showed off how cool it was, and now EVERYONE has one, mostly for the fact that...well..everyone has it. google is basically saying "we will create a bigger, more dedicated fan base than you without people even having to see the phone for themselves, or have to market it through a single carrier and be locked down by it." no one really wants to say it, but google's phones are directly competing with the iphone. of course sales arent going to be good at first when you introduce something new to the market that people arent sure about. but thats how you get out. you have a firm core fanbase, they get the product, they show it off to friends who love it, their friends get it, and it spreads. simple. google is already stealing shares in the phone market from apple and microsoft. by the time nexus two comes out, apple's gonna be sweating.
  • I understand that. All I'm saying is it would've been better if they were using the "let's get as many sales as possible" model to really the show the world the power of Android with Google behind it.
  • Alan Parker
    I agree that it probably would have boosted N1 sales if Verizon had been invited to the party. However, Google appears to be more focused on changing the way phones are sold, rather than selling as many phones as possible. I've even read accounts of Google execs saying they are pleased with N1 sales to date and that those sales are not far off from their projections, financial analysts notwithstanding. I don't have an N1, or any smartphone for that matter, I'm just an interested outsider looking in. I applaud Google for sticking to its model and wish them well in their endeavor. More competition is always good for the consumer.
  • You need to get a smartphone. You'll be hooked. ;)
  • joemomma
    Clearly your missing the point of what google is trying to do. This is why you cant trust anything that you read because you clearly dont know facts before thinking that you can be a writer ...the point of this is not sales its to get rid of carrier specific, ass clown.. learn ur facts
  • No, I'm not missing what Google is trying to do. They are trying to take down carriers as the middleman with the Nexus One's online retail-only model. All I'm saying is - it would've been better if they focused on becoming a powerful hardware company first, then did the online-only model. That would've hurt a lot more and been more effective. Wouldn't you agree?
  • menorrhagia
    Nugdeep Hora according to you AMAZON should have waited to become a powerful hardware company for everything they sell then should have tried to sell on their web site. Try telling this to Mr.Bezos.
  • Really mature way of commenting. Calling me names certainly added to the discussion.

    Uh, no, Amazon didn't need to do that because they were already successful in one business - selling products online. They weren't trying to kill the equivalent of carriers in their industry. All they had to do was create the Kindle, put it up on Amazon and market the device. So, no, this advice doesn't apply to Amazon.
  • Zohrab
    Gundeep, I am sorry to say that I agree with the postings of the morons above, I actually posted the same the without seeing their remarks, but idiots like that should not be allowed to post. I don't agree with you but I am up for ADULT nice disagreement. The uncivilized above need to take their name calling comments to websites where they can find more trash of their kind. Please kindly remove their posts and don't even answer to posts like that.
  • BN
    HA you put down name calling but call the other posters morons!?
  • Peter
    Mr. Gundeep Hora, you certainly must have some connection to Apple otherwise you'd present more balanced article! Thank you for waisting my time.
  • What's wrong with the article? It's an Op-Ed piece. The purpose of the article is to share my opinion with readers.
blog comments powered by Disqus