Nexus One: Is Google pushing away from smartphone sales business?

Google has shifted gears on its newest smartphone for Verizon in a way that suggests it may be backing off of its effort to sell directly to the consumer.
Written by Sam Diaz, Inactive

Back in January, Google made a splash over the Nexus One smartphone - summoning the tech press out to the Googleplex for an introduction to not only the device itself, but also a new way of selling it.

You see, Google wanted to reinvent the way consumers shop for and buy cell phones. Pushing away from a model where specific devices are tied to certain carriers, Google had this vision of selling its devices directly to the consumer and then giving them a choice on which carrier to use.

It was a valiant effort but was flawed right out of the gate. First, there were questions galore on who would handle offline sales, support and service - Google certainly wasn't equipped to handle that. Then came the rumblings over what was perceived to be double "early termination fees" - those imposed by the carriers and a separate that would be charged by Google.

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Now, the company has quietly made one change to its Nexus One online store that suggests - for those of us trying to read deeper into it - that Google may be backing away from its push into the online smartphone sales business. (Techmeme) For months, its site has been pitching the Nexus One for Verizon as a "Coming in Spring 2010." This morning, the language was changed to read: For Verizon's network, you can buy the Droid Incredible by HTC, a powerful Android phone and similarly feature-packed cousin of the Nexus One.

Below that, there's a link that sends visitors to Verizon's website to place a pre-order.

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Here's hoping that Google finally saw the light and decided to rethink the strategy. One of its biggest flaws was that Google, as a retailer, was becoming a competitor to the carriers that it was also partnering with. The other big problem was that the unsubsidized device carried a price tag that clearly wasn't going to resonate well with consumers - $529.

None of this is to suggest that the current system of mobile phone sales, support and service is model is the perfect system that doesn't need changing. It's gotten better - but consumers do want more freedoms when it comes to buying mobile devices. If those sort of freedoms were in place, I would have bought an iPhone for my Verizon plan years ago.

Instead, I've completely lost interest in the iPhone and instead will likely walk into a Verizon store to pick up a Droid Incredible later this week. And I'll be relieved to actually buy it from a real person and walk out of store with one, instead of clicking on a "Buy Now" link and then waiting for a UPS driver to deliver it later.

There's no shame in trying to rock the boat a bit and Google gave it a good shot. There really wasn't much risk, given the overhead involved with the online store model, so Google didn't have much to lose. Pouring some cash into a marketing or advertising budget might have helped - after all, it helped the Droid gain some traction - but that alone wasn't going to make the online sales model work.

Google needs to stay focused on doing what it does best - enhancing a smartphone OS that will give the iPhone a run for its money, building that app developer community and cutting deals with a variety of device manufacturers and carriers.

That alone rocks the boat enough for me to want to jump on-board.

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