Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

Summary: If Google wants to advance Android and put devices like the Nexus One up against the iPhone, it needs to dump that online-only sales model.

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For a while now, I've been waiting for the iPhone to make its way to Verizon. I've been out of contract for a while now but had been holding out for the iPhone before signing up for two more years under the Verizon plan. The wait for the iPhone got pretty old, pretty fast so I'm kind of over that already. Waiting for iPhone, I got used to using Android devices - and I'm pretty much sold on the experience.

I wasn't much of a fan of the Motorola Droid - not because it's not a good phone but because I don't care for the bulkiness of slide-out physical keyboards. I prefer the touch screen, which was one of the things I found appealing about the iPhone. Maybe that's why I took to the Nexus One (for T-Mobile) during my trail period with it.

Also see: Googling Google: Google's online-only phone selling model has failed

Now, here's where I'm stuck: I had every intention of signing up with Verizon for two more years when Google announced that the Nexus One would be available on Verizon's network in the Spring - now just days away. But now I'm having second thoughts - quite frankly - because I don't want to buy it from Google. I want to buy it from Verizon.

It's not that I like one company over the other or that I'm anti-ecommerce. Plain and simple: Verizon has a store - an old-school bricks-and-mortar store with real employees, people who I can talk to face-to-face when things go wrong, people who can reset things or swap things out or even suggest a good cover for the device.  These stores are convenient, littered about the cities everywhere, with locations always within driving distance of where I am.

You see, I'm an instant gratification kind of guy (it's one of the reasons I carry a smartphone.) If something needs fixing or replacing, I'm hopping into my truck and heading to that store so someone can get it fixed or replaced right now. I'm not looking to send off an e-mail help ticket and wait for the UPS driver.

Also see: Google, Nexus One and the customer service risk

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I've said it before and I'll say it again. Google should not be in the business of selling smartphones. Develop that software, integrate those other tools, enhance the user interfaces and, yeah, give more than two cents when it comes to things like design and pricing. But leave the sales, marketing and support to the carriers. (Oh, and don't even get me started on the that whole separate equipment recovery fee that Google charges - in addition to what the carriers charge.)

Also see: Google's $350 ETF makes sense to bean counters; Annoys customers

Sure, Apple does all of that and more - but that's Apple. Google should focus on what Google does best and leave all of those other details to the manufacturers. To try to take on too much will only slow down the momentum. In a post late yesterday, Garett Rogers points to a Goldman Sachs report that reduced sales estimates of the Nexus One for 2010 - from 3.5 million down to 1 million.

Ouch.

The reason? The reports says that one possibility is "limited marketing and customer service challenges." Google can benefit from a launch with multiple carriers - both in the U.S. and overseas. Assuming that 1) Google rolls out a second handset, 2) markets it more aggressively and 3) makes it available offline, then it can potentially sell 2 million per year in 2011 and beyond, the report said.

If anyone over at the Googleplex is listening, for what it's worth, I'd much rather walk into a Verizon store later this month so I can walk out with a new Nexus One - up and running today, not arriving via UPS tomorrow.

Topics: Mobility, Google, Hardware, iPhone, Smartphones, Verizon

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10 comments
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  • Nexus One- A Superphone

    I completely disagree with your observations and the previous blog on Nexus One. You are supporting the status quo and the network monopolists who instituted slavery in your phone purchase--2 year contracts when technology is rapidly changing. US market a monopoly where competition limited for monthly rolling contracts to support SIM free purchase. Very common to buy in UK this way and 5-6 networks compete fiercely over monthly contracts bring down total cost of ownership. Nexus One very popular in UK for this reason. Time to change thinking in US.
    modelportfolio2003
  • RE: Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

    I read an article the other day that mentioned that Verizon sales people have been receiving training on the Nexus One. That implies, to me, that they may be selling it in stores. Granted, it's still all speculation. But, don't give up hope just yet!

    http://www.boygeniusreport.com/2010/03/06/verizon-already-training-some-employees-on-nexus-one/
    KittyPrawn
    • Like Nexus One, but wanted Verizon service

      I gave up waiting for Verizon/N1. Bought two HTC Eris, with good sales/service from local independent Verizon store. I was willing to wait a bit longer, but our Palm Treos were nearly dead, so we gave up and will take another look at one-year upgrade time. The HTC/Verizon current deal is just too good to pass up. Buy an N1 for a bunch$$$ just to be unlocked? Not that important.....
      cappidad
    • @Kitty/Nexus One

      I would be surprised if training meant what you think---selling in stores and walking away with phone. In UK Vodafone "training" consists of knowledge of phone but pointing you to Google.com/phone website to order. This phone is awesome. In UK, the SIM free model is perfect for most buyers who can figure out TCO (total cost of ownership): cheaper to pay up front $529 to Google and monthly contract to Vodafone--check out link:

      http://shop.vodafone.co.uk/shop/sim-only-plans/all-sim-plans

      You must know that it is cheaper for users of the Nexus One for competition to spread on monthly contracts, which is what Google hoped to create, but so far, only T Mob US offers a fairly expensive monthly plan compared to the $30 I pay in UK. When Nexus 2 arrives in 6 months, I can sell my Nexus 1 on Ebay and am not stuck with 18 months of payments to an operator like Verizon. Wake up and smell the coffee!

      Google should not be blamed for a failure to convince network operators in US to be competitive like in UK. Operators are monopolists and FCC needs to change that!
      modelportfolio2003
  • RE: Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

    @Cappidad. I am sorry you are a slave to Verizon. No competition from other operators on monthly deals means unlocked phone not competitive yet in US. See my note above in UK--we are way ahead of you and FCC should get after the US monopolists. Google tries to change network behavior in favor of user. No one else has power to change their behavior, other than FCC.
    modelportfolio2003
  • RE: Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

    Anxious for the Verizon iPhone. I hope it does arrive in June!.. Follow me at @CraigMarker
    csmarker
  • RE: Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

    Sam, what difference does it make if 5 million people buy it or only 100 thousand. If you like it, buy it, end of story. I presume that 6 months from now, or less, you'll probably buy another one anyway or atleast I will. I can keep a phone for 6 months before its time to up or sidegrade it. In the last 24 months I have owned an Palm Treo, iPhone, Centro, BlackBerry, and now the venerable Palm Pre. My current outlook? if Palm launches the Pre 2 I'm buying it or if Google gets its act together on 3D gaming (currently limited by its internal storage capacity) before Palm launches their 2nd gen, well I'll own an Android device regardless who else buys it!
    worldbfree4me
  • You can buy the iPhone

    or you can buy Google's spyphone. Google spyware is the biggest challenge to the Nexus One.
    jorjitop
    • really?

      but of course, Google's "don't be evil" mantra is
      "bullshit" according to the black turtlenecked man
      himself, so they must be spying on you. All Apple
      does is randomly approve and reject apps from the
      app store and sue people left and right. They must
      be good. I'll go with Google any day. Can't wait
      for the HTC Incredible.
      kkj.12
  • RE: Nexus One's biggest challenge isn't iPhone; it's Google's online-only sales model

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