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Why the Nexus One Can’t Win

Google has always concerned itself with being a consumer friendly, and overall “good” company, evidenced by their very simple corporate motto of “Do No Evil.”  Google usually does a fantastic job of making decisions based on this philosophy.  Gmail was one of the first email systems to lift the draconian standards for email capacity to a whole gigabyte (which now seems rather silly since my GMail account is about triple that and growing,) their Google Doc’s movement which is threatening Microsoft’s global domination of the word processor market, and even some basic things like Google Maps (which I’m sure most of us have used at some point or another,) and Google Voice.  So when they began developing a Mobile Operating System that was open source there was huge praise.  However, Google’s intentions were not wholly selfless.  With the announcement of the Nexus One Google took a small sidestep around their motto to come in direct competition with other handset makers.  Google’s idea was to offer a handset outright and off contract directly to the consumer to further undercut the networks, but what is good for consumer’s is not always the decision they make.

     The Nexus One is a nice handset.  It has its quirks, and what some would call issues.  Aside from Google’s inability to provide any phone support for these ailing Nexus owners they face a significant barrier to entry that I haven’t seen discussed.  Google’s distribution model for the Nexus One is its true failure.  Google views contracts as a nasty endeavor for mobile consumers, and in truth it is not really a major benefit to them in the long run.  Contracts allow networks to hold you in a service contract that may or may not be needed or necessary a year from when you initially signed up.  Anyone who’s ever had an angry ex-girlfriend on your cell phone plan knows exactly the sort of peril said consumer would find themselves a part of.  When asked directly whether or not they would want to be under contract for service most every customer would answer no, but turn around and tell them the phone they want is going to cost them 500-600$ instead of 100-150$ and they become outraged.  Although these consumers know that contracts are no good, every two years they waltz into their mobility provider of choice and pick out a new plastic brick that lights up and makes noise to distract them from the anal rape going on at the other end. 

     Now even without subsidizing the handset costs Google could (and may have) pushed for distribution through the Mobile Providers but not accomplishing this really set them back.  So to Google the obvious solution was to offer unlocked phones directly through their site.  To show how poor a decision this was I’m going to ask you guys.  How many users have purchased unlocked phones?  Google, while trying to be consumer’s Knight in Shining Cellular Handset Providing, failed to realize the limited market their distribution model would reach.  I know that the majority of readers here will be Internet savvy and know exactly how to get their hands on the Nexus One (even though I’d wait for the Desire, because optical sensors are tits,) but when the majority of America, even the ones with more money than tech savvy, want a high end device or any device for that matter they trudge into their local AT&T, Verizon, Best Buy, or whoever.  From there, a consumer’s basic instinct is going to be finding the most functionality for the least amount of money. 

     Now just about everyone here will agree with the fact that the iPhone is not the most capable smartphone on the market (tyrannical Steve Jobs fantasies aside,) but what functionality is there is elegant and easy enough for drooling three year olds and aging geriatrics alike to use and understand.  IPhone adoption did not happen when the device debuted at 299.99$ on contract.  Apple sold a lot of handsets, quite a few more than most were able to move, however the mass adoption of the iPhone did not occur until the original iPhone came down to 99.99$.  This made sense for consumers to purchase for not only high end gadget minded folks, but for teenagers and even some spoiled tweens as well to merge their child’s mp3/phone experience into one device (and if purchased at certain retailers can get insurance on.)  I’m not advocating for anyone to purchase an iPhone, and don’t you dare tell anyone I said that, but what you can see is that consumers aren’t long term thinkers.  Google started thinking too lofty and the message flew right over most consumer’s heads.  Hopefully the longer the Nexus One is out the more adoption there will be, and word-of-mouth (along with Doug bragging all over the place about his) may help Google get a few more handsets out into the market.