Coming soon: the Google Phone

21 Dec

December 21, 2009

By Geoff Meeker

One giant is set to take on another in what is shaping up to be the technology war of 2010.

At stake is billions in revenue in the lucrative mobile phone market.

The tech world has been ablaze for months with rumours that Google was developing its own phone. The buzz was confirmed December 12 by the Wall Street Journal. The phone will be called the Nexus One, and will be manufactured for Google by HTC.

“The Internet giant is taking a new, and potentially risky, approach to selling the device,” wrote reporter Jessica Vascellaro. “Rather than selling the phone through a wireless carrier – the way the bulk of phones are sold in the U.S. today – Google plans to sell the Nexus One itself online. Users will have to buy cellular service for the device separately.”

This is an aggressive assault on three different fronts. First, Google is going after Apple and its super cool iPhone, which has come from nowhere to rule the industry at breakneck speed. (At the end of CBC newscasts, they actually announce that news can be downloaded to your iPhone and iPod Touch. No other phone is mentioned. That’s what I call market dominance.)

Second, by selling the phones online, Google would be bypassing technology retailers, who often sell their phones at a discount when customers sign long-term wireless service contracts. How will consumers react to paying full price for a phone, no matter what type of contract they sign with the carrier?

Third, Google will compete with the cellular phone manufacturers who, until now, were its partners, in something called the Open Handset Alliance. Launched in 2007, the alliance was a consortium of high profile phone manufacturers who had come together to use a common software platform to drive their phones (rather than a proprietary one, such as that developed for the iPhone).

The alliance was using Google’s own Android software. Google’s goal at the time was to power hundreds of different phone models using this software. However, industry insiders have already observed that Google’s decision to compete head-on as a seller of hardware will likely kill the alliance.

Word of Google’s foray into the hardware market was leaked earlier in December, subsequent to a staff Christmas party where hundreds of employees were given working Nexus One phones to try them out over the holidays. The phones were given out ostensibly for staff to test drive them and report any bugs, but one suspects it was also to create some buzz in advance of the launch, rumoured to happen in January.

Right after the party, employees began Twittering about their phones. Here are some of those tweets:

“Stuck in mass of traffic leaving work post last all hands of 2009. ZOMG we had fireworks and we all got the new Google phone. It’s beautiful.”

“A friend from Google showed me the new Android 2.1 phone from HTC coming out in Jan. A sexy beast. Like an iPhone on beautifying steroids.”

“It was thin. Dare I say as if not a bit thinner than iPhone. Scrolly ball like on the Hero [phone]. This one was running on AT&T.”

So here’s the thing. Google is an innovative and clever company that does not do things in half measures. If they are going to announce a new telephone, consumers are going to watch closely and they’re going to have high expectations.

The freedom to choose your own carrier is fine, but it’s not a technological advance.

If Google unveils just another iPhone clone, and not a significant leap forward, you will hear a great sigh of disappointment from technology users. And people will react with some skepticism, the next time Google has something big to announce.

Geoff Meeker is a communications consultant with a soft spot for technology. He also writes a blog about the local media scene, which is hosted at http://www.thetelegram.com.

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