Google to close Nexus One storeMay 14, 2010: 1:53 PM ET
Google announced that it would soon change the focus of its Nexus One store, moving from selling to showcasing.
On its Official Google Blog, Andy Rubin, Vice President of Engineering in charge of Android, acknowledged that the Nexus One store had seen lackluster sales and notified users that it would soon shift its focus from sales to showcasing new Google phones. Even with the strong publicity and plenty of Adsense ads, the Nexus One never took off like Verizon's Droid. Flurry Analytics said that the Nexus One had about one tenth of the sales that the Droid had in its first 74 days on the market (right).
The experiment was meant to bypass mobile carriers in the purchase process. Google (GOOG) would decide on the applications, user interface, and updates instead of the carriers.
T-Mobile was the first to sign on, offering a subsidized ($179) plan. AT&T subsequently added a version of its own, but AT&T (T) didn't offer any subsidy for signing up. Both Verizon (VZ) and Sprint (S) canceled their Nexus One phones this month, due mostly to the fact that they'd soon be releasing their own higher-specced Android "superphones".
Unlike Apple (AAPL), Google does not have a physical store to sell its products, so mail order was their only option. Apple currently sells iPhones and iPads at its many domestic retail stores.
Google is changing the focus of the "store" to advertising and viewing as it does in Europe. They list the following changes:
More retail availability. As we make Nexus One available in more countries we'll follow the same model we've adopted in Europe, where we're working with partners to offer Nexus One to consumers through existing retail channels. We'll shift to a similar model globally.
From retail to viewing. Once we have increased the availability of Nexus One devices in stores, we'll stop selling handsets via the web store, and will instead use it as an online store window to showcase a variety of Android phones available globally.
While the Nexus One didn't sell terribly well, the carriers are doing an excellent job of moving Android phones. NPD said this week that Android phones were outselling iPhones 28% to 21% in the first quarter of the year and Google said it is moving at least 65,000 handsets a day. That would put Google at two million a month, or 24 million/year. That's on 34 mobile devices in 49 countries, far fewer markets than the iPhone, which sold over 8 million units in the quarter.
Then there is China.