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April 24, 2012

Google Sells Phones Again

Google Play is not just for digital content. You can now buy unlocked Galaxy Nexus phones for only $399 if you are in the US. "Galaxy Nexus devices purchased on Google Play are unlocked GSM/HSPA+ devices. The unlocked Galaxy Nexus requires GSM compatible service provider for voice calling. In the United States this includes AT&T and T-Mobile," explains Google.

"Galaxy Nexus costs $399 and arrives at your door unlocked, without a carrier commitment or contract. You can use it on the GSM network of your choice, including T-Mobile and AT&T. It also comes pre-installed with the Google Wallet app which lets you easily make purchases and redeem offers with a tap of your phone. Best of all, we'll give you a $10 credit to get you started with your new mobile wallet," mentions Andy Rubin.


This is not Google's first attempt to create an online store for selling Android devices. Back in 2010, Google launched a web store that allowed you to buy a Nexus One and choose your favorite service provider. Google's goal was to add other Android devices and to make it easy to buy phones. Unfortunately, Google's store wasn't successful, people complained about the lack of customer service, Verizon skipped the Nexus One and Google closed the store four months later. "While the global adoption of the Android platform has exceeded our expectations, the web store has not. It's remained a niche channel for early adopters, but it's clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to chose from," said Andy Rubin at that time.

It's really difficult to sell unlocked phones in the US because they're a lot more expensive than the locked phones, plans cost the same and phones can't be used on two of the most important carriers: Verizon and Sprint. This time, things are a little different: Galaxy Nexus was only available for Verizon customers and its price dropped from $299 to $199. While $399 is not a high price for an unlocked phone launched 5 months ago, you can buy subsidized phones that are more powerful than Galaxy Nexus (for example, HTC One X for $199).

Google's new store is better suited for tablets, since most people don't buy subsidized tablets. As the Wall Street Journal speculated last month, "Google will open its own online store this year, but stocked with tablets instead of phones. The Android tablets would be built by Samsung and ASUS who already offer the well received Galaxy Tab and Transformer lines, but have been unable to make a dent in marketshare comparable to that of Apple or even Amazon."

7 comments:

  1. In fact, I'm pretty sure that the US (and Canada) is the worst market for unlocked phones. The lack of a standard like GSM and the inertia of 2-year contracts make it difficult, as you say.

    However, that is the excption. Most of the global phone market is off-contract, so Google has a chance here. The Google Play site is at the top bar of the browser every day for hundreds of millions of people, so this could be the online store with the biggest audience. And for people who are already on Android, you can check out a new app and then a new phone, for example.

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  2. T-Mobile's Value plans, with no phone subsidy, are generally cheaper than the traditional subsidized plans. So you CAN get a cheaper plan to use with this phone.

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  3. You can buy this phone and use it with a prepaid plan that is a LOT cheaper (Eg: Simple Mobile and Straight Talk) for unlimited everything, compared to AT&T, Verizon or T-Mobile plans. These prepaid plans are from T-Mobile and AT&T MVNOs. So, they are perfectly suited for this phone. That would make the total cost of ownership of this phone, over 2 years, very competitive compared to other phones you get subsidized from carriers.

    This deal from Google will cost me $435.83 with shipping and tax. A couple of weeks ago, I saw this phone for $429 with free shipping and no tax from Amazon.com. I fully expect this to be available soon for cheaper than Google's store on Amazon.com.

    I think Samsung milked this phone for as much as they could from the carriers till now. That is why they did not let Google sell these phones. Now that the release of Galaxy S3 is imminent, they must have figured that they could milk this device some more through the Google store cuz there are many people who like to buy a Nexus device directly from Google. Google would have sold a LOT more phones if they offered it through their store a few months ago at a competitive price. Google has a bad track record of being able to negotiate with hardware/carrier partners.

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  4. They need to roll this out to over countries. £250 for a Galaxy Nexus? I barely use calls and texts, there are phone companies in the UK that sell 500MB a month (about average what I use, most of my data is over Wifi) for £5. I'd save a ton of money!

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  5. The Galaxy Nexus is a really grat phone and excellent value for money, my son has one he loves it.

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  6. Wow, I have my old HTC phone but I am thinking about getting this new Nexus one, I wonder, is it a good choice?

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  7. To the commenter above, dont buy HTC, go for Nexus, its awesome!!!

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