Feeds

Carrier apathy depresses Google Phone outlook

Nexus One estimates drop 70%

Boost IT visibility and business value

Google is discovering just how dangerous it is to ruffle the feathers of the major cellcos. Its Nexus One handset may be one of the most advanced on the market and bear the magical brand, but half-hearted marketing efforts by carriers have led to disappointing sales. Now, analysts at Goldman Sachs have slashed their estimates for sales of the phone this year by 70 per cent.

Several operators did lend support to the Nexus launch, despite Google's introduction of a direct-to-consumer sales approach, but there was always a sense that their backing was grudging - and largely based on a fear of losing out, should the phone prove as wildly popular as some analysts predicted.

Their main qualms would have surrounded the route to market. Google offered the device, with a selection of carrier deals, from its own specially created web store. In some ways this was no different to an Amazon approach, but it was widely seen as the thin end of the wedge, in Google's avowed bid to relegate the operators to bitpipe roles and put its own brand center stage. Cellcos will have heaved a sigh of relief that uptake of the Nexus was disappointing in the early stages, and that other handsets with similar capabilities quickly came along - notably the Desire from HTC, which also makes Nexus. Both these options offer Android 2.1, gigahertz Snapdragon processors and other attractions, though the Desire has been more acclaimed for its user experience.

In the hype surrounding the launch of Google's first own-branded handset, some pundits predicted that it would sell 3.5m units in its first year. Now Goldman Sachs has cut its forecasts, and wrote in a research note, quoted in ZDnet: "We previously estimated that Google might sell 3.5m Nexus One units in 2010. Initial data points were disappointing, possibly due to limited marketing and customer service challenges. Flurry estimated (based on mobile traffic) that Google sold 20,000 in the first week, and 80,000 in the first month, both annualizing to 1m. We forecast that Google sells 1m Nexus One units in FY2010, benefiting from US carriers other than T-Mobile, and non-US carriers such as Vodafone, promoting the device too, but suffering from limited marketing activity."

Vodafone is the only international carrier that has committed firmly to Nexus One, though it shows no signs of putting the phone high on its list of marketing priorities, with much of its effort being placed behind other HTC models, the iPhone and its own 360 models.

Undeterred, Google is still expected to announce new Nexus models and widen the distribution of the original. This year should see a more enterprise-focused 'Nexus Two', probably made by Motorola, and a cutdown version of the first phone is reported to be launching in India and Russia in the fourth quarter. This would sacrifice some features, including the top-end processor, in order to keep the price down around the INR24,000 (about $500 unsubsidized).

Copyright © 2010, Wireless Watch

Wireless Watch is published by Rethink Research, a London-based IT publishing and consulting firm. This weekly newsletter delivers in-depth analysis and market research of mobile and wireless for business. Subscription details are here.

Secure remote control for conventional and virtual desktops

More from The Register

next story
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
EE: STILL Blighty's best mobe network, says 'Frappucino' Moore
Fresh round of network stats fisticuffs possibly on the cards here
New Sprint CEO says he will lower axe on staff – but prices come first
'Very disruptive' new rates to be revealed next week
US TV stations bowl sueball directly at FCC's spectrum mega-sale
Broadcasters upset about coverage and cost as they shift up and down the dials
Tech city types developing 'Google Glass for the blind' app
An app and service where other people 'see' for you
Canadian ISP Shaw falls over with 'routing' sickness
How sure are you of cloud computing now?
UK mobile coverage is BETTER than EVER, networks tell Ofcom
Regulator swallows this line and parrots it back out at us. What are they playing at?
What's the nature of your emergency, Vodafone?
Oh, you've dialled the wrong number for ad fibs, rules ASA
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.