Google developing own ‘Nexus One’ phone; may challenge Apple as soon as next month

“Google plans to begin selling its own smartphone early next year, company employees say, a move that could challenge Apple’s leadership in one of the fastest-growing and most important technologies in decades,” Miguel Helft reports for The New York Times.

“Google’s new touch-screen Android phone, which it began giving to many employees to test last week, could also shake up the fundamentals of the cellphone market in the United States, where most phones work only on the networks of the wireless carriers that sold them,” Helft reports. “The company, using the power of its brand, plans to market and sell the new phone directly to consumers over the Internet, and buyers would be able to sign up for service from any compatible provider, the employees say.”

“The introduction of a Google phone — manufactured to its hardware and software specifications by an Asian maker of handsets [HTC] — would be an important and risky departure for Google,” Helft reports. “Until now, it has made software to power cellphones that are built and marketed by partners, and it has largely avoided selling hardware.”

“But analysts say it is not clear that Google’s success on the Internet will carry over into the design, marketing and distribution of hardware,” Helft reports. “Many companies have tried to make similar shifts and stumbled… when Microsoft pushed aside its partners in the music-player business in favor of its own Zune, it failed to gain traction against Apple and its iPods. The phone’s success could also depend on how Google chooses to price it. Most Americans buy phones that are subsidized by wireless carriers, which recoup that cost by locking customers into contracts. IPhones that cost consumers $199 actually cost AT&T about $550, analysts say.”

“Google employees who spoke on the condition of anonymity because plans for the phone were supposed to be confidential said that the device, manufactured by the Taiwanese company HTC, was thinner than Apple’s iPhone, with a slightly larger touch screenHelft reports,” Helft reports. “It could be available as early as January, they said.”

Helft reports, “Analysts say that the iPhone, despite prominently featuring some Google services, makes the company nervous. ‘They don’t want to have access to Google being controlled or influenced by one player like Apple,’ said Ben Schachter, an analyst with Broadpoint AmTech, a research firm.”

More info in the full article here.

MacDailyNews Note: According to Google employees’ tweets and a Wall Street Journal report, the HTC-built device will be called “Nexus One” and feature Google’s Android 2.1 operating system, capacitive OLED touch screen, Snapdragon 1 GHz processor, GSM, and an software keyboard (no physical keyboard).

[Thanks to MacDailyNews Readers “Fred Mertz” and “James W.” for the heads up.]

46 Comments

  1. Google may have a well known brand but what have they actually sold to customers? Apple have spent the last few years building up a brand that actually sells things, that’s the difference at this stage, I can see some more tech minded people taking the plunge for a google phone but I can’t see it instantly getting the same sort of cross market traction that the iPhone has.

  2. They may be a credible threat in the sense they controll the entire widget like apple. Even more so given that they have some more apps then apple controls. And being open and not carrier locked gives them flexibility. However I would like to see how they will be servicing these units. Who would you bring it to and how competant would they be?

  3. So … the HTC phone they were accused of re-branding was actually a look-alike shell with Google-designed innards? Both software AND hardware? That would certainly put a different slant on things. OK, it would change the picture entirely.

  4. There’s certainly room for 2 high quality mobile handsets in the market. In fact, Android will almost certainly push Apple to innovate even faster (a good thing for all us iPhone lovers).

    My prediction: iPhone and Android will be the last standing… Within 2 years it will be RIP for BB, Nokia, WinMo and WebOS…

  5. God point about servicing Maui. We all know no handset is 100% bulletproof. And will there be any carrier subsidy to offset purchase cost (which can’t be cheap). Not a credible threat until these questions get answered and Google actually starts selling it.

    “Remember the Pre.”

  6. To the consumer, Google has a good name. But, as a paying advertiser in the Adwords proram, they are horrid. They have a monopoly on the market and they can/do literally anything they want to do. If they become a major player in the phone market, they will be an angel as they start up. But, if by some act of the devil, they gain a monopoly like they have in the search category..heaven help the consumer.

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