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March 19, 2010

A bad week for Google?

Posted: 03:22 PM ET

By some accounts, this week hasn't been so great for Google.

The first bit of bad news concerns sales of Google's Nexus One phone.

On Tuesday, the market analytics firm Flurry released a report saying initial sales of Google's Nexus One phone have been slim compared to the Droid and the iPhone. The firm compared sales of those those phones over the first 74 days they were on the market. In a blog post, Flurry says it chose that time period because that's how long it took the original iPhone to sell 1 million handsets when it was released in 2007.

By comparison, only 135,000 Nexus One phones were sold in that phone's first 74 days. More from Flurry's post:

As Google and Apple continue to battle for the mobile marketplace, Google Nexus One may go down as a grand, failed experiment or one that ultimately helped Google learn something that will prove important in years to come.

Google responded to that news by playing up the Android Market, the online store where people with Android phones - like the Nexus One and Droid - buy applications, according to Engadget

Google issued a statement to CNN, saying:

We’re pleased with our sales volumes and with how well the Nexus One has been received by our customers. The Nexus One is one of a fast growing number of Android handsets which have been brought to market through the open Android ecosystem. Our partners are shipping more than 60,000 Android handsets each day compared with 30,000 just three months ago.

Not everyone says this news is so bad, though. Concern about the Nexus One's slow start is "more than a little ridiculous," writes Derek Thompson at The Atlantic:

Google is still a software company dabbling in hardware. And its mobile smart phone software is very, very good.

The other potentially troublesome story concerns Google's search traffic.

Microsoft's Bing search engine appears to be making slight inroads on Google, which still dominates that territory. A Nielsen report, issued Monday, found Microsoft searches in February made up 12.5 percent of the search market, compared to 10.9 percent in January. Meanwhile, Google still accounts for 65.2 percent of all U.S. searches.

The Wall Street Journal's D: All Things Digital blog notes that the shift in the search market is "slow going":

... Bing is clearly whittling away at both Google and Yahoo’s search market share. Of course, the flip side is that with Yahoo in decline, the search side of the Microsoft-Yahoo partnership isn’t showing all that much growth.

What do you think? Is Google, clearly one of the world's dominant tech companies, in any trouble here?

Was its jump into the mobile phone hardware market misguided, or do you think Nexus One sales may still take off? We welcome your thoughts in the comments section below.

Posted by:
Filed under: Android • Google • iPhone • Microsoft Corp.


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Paul Croft   March 19th, 2010 3:40 pm ET

I think once the Nexus one hits the other phone retailers you will see a huge jump in sales, its unfair to compare the launch of the Iphone and the Nexus one at this time. I feel 6 months from now will tell a different story.


Avrailer   March 19th, 2010 3:43 pm ET

google has a phone?


Ryan   March 19th, 2010 3:58 pm ET

What the hell is a 'google'?


JoblessPu   March 19th, 2010 4:04 pm ET

I don't know where to buy one! A few days ago I went to all the phone comanies stores looking to test one out. I couldn't find one store that had the Nexus One. I think google hasn't put the phone in the publics eye like apple has with there iPhone. Once the public knows more about it I could see the sales go way up.


Amit Gandhi   March 19th, 2010 4:10 pm ET

Don't know about Nexus One, But definitely Android is one of the best phone OS in market. every month android market share is growing up.The reason behind of less sales figure of Nexus one is bad marketing, i guess.


Jr   March 19th, 2010 4:14 pm ET

Google is doing just fine and will continue to do so and grow. Comparing the launch of the original iphone with the launch of the Nexus One is literally comparing Apples to Oranges, err in this case, Googles.
This comparison would be more comprehensive and if fair if it also included initial marketing expenses.
I have and absolutely LOVE the Nexus One, but had I not been keeping such close tabs on the developing smartphone market in search of my 1st, I probably wouldn't have heard much about the Nexus.
I found it, and ultimately purchased it, because it is a far superior product to the iphone.
An experimental, and reasonably cautious foray into the smartphone market that undoubtedly will prove well for Google.
I'm not convinced the case will be the same for Bing, brought to you by a corporation that has for years had less than adequate search capabilities.
And the comments so far...whether serious or not, I take great pride in knowing that I have a superior product not because I was lured in by mass marketing and popularity, but because I followed my intellect and intuition.


Shane   March 19th, 2010 4:25 pm ET

If telecon companies like AT&T give unsubsidized phone buyers fair price on data plan, Nexus One can take off. I am tempted to get Nexus One on AT&T without data plan, but afraid AT&T force me on the expensive data plan.

T-Mobile, getting a better coverage and continuing to give unsubsidized phone buyers data plan price break, lots of people will jump on your ship.


Me   March 19th, 2010 5:45 pm ET

http://www.google.com/phone

Thats the only place purchase a Nexus One. Hence the slow sales for them


stefan   March 19th, 2010 5:47 pm ET

For those who don't know, Nexus One initially can be purchased through T-Mobile. Later this year it should be available with other carriers. Not sure if it will work on VZ's network which is CDMA


peter   March 19th, 2010 5:55 pm ET

I agree with paul in the first comment. I've just been waiting for the nexus to hit verizon.....along with about 10 million other verizon customers, that should boost sales a little. As for BING, if it would stop capturing by home page and search engine illegally it wouldn't have nearly the market share that it does. I hate having to close my browser and reopening it to get rid of the BING. Just like every other microsoft product, it takes over your computer.


Hannah   March 19th, 2010 8:32 pm ET

I was up for an upgrade with Verizon two months ago and could have switched over to AT&T for the iPhone, but I have been holding out for the Nexus One to officially start its service with Verizon. So Google... let's get with the program!!! "Spring 2010" could be anywhere from March to May, and the more they delay the more they lose out on potential customers. But once that happens, I can see a lot of loyal Verizon customers switching their phone to the Nexus One, or whatever the new name of the phone is going to be.


mark   March 19th, 2010 8:38 pm ET

Waiting for Verizon to accept phone. I will be dumping my Droid for the N1.


William   March 19th, 2010 8:38 pm ET

I think it's crap that if you have a family plan you can not get the Nexus One! Thas like walking a car dealers lot and saying "Oh this is the car for me!" Then the salesperson saying "Oh, i'm sorry. I noticed your wearing a wedding ring and have a family, you can't buy THIS car."
They are losing sales by the thousands due to this sales structure. Other than that, good device. Too bad I won't be able to enjoy it...


rab   March 19th, 2010 9:47 pm ET

I think people are missing the point. Google has money to spend, money to invest, you could even say they have money to waste. This venture with the Nexus One is more about a pardigm shift than just hitting a revenue target. They are fighting against the establishment of wireless phone 'carriers' and the marketing games they play with the public. They are fighting against Apple and the AT&T and the exclusivity of the iPhone. They are fighting against the brick-and-mortar model and rejoicing in the advancements and efficiencies of e-commerce. This is a demonstration, a statement, a protest of principle that will change the face of wireless communication for the years to come. And it's a pretty hot phone too...

Once this baby hits Verizon, all bets are off. The numbers will soar. That's if the Incredible doesn't make it first. And especially if they rumors are true. 6gb of on-board memory? 8mp cam? 1bg RAM? This sounds too good to be true. Most people I know have desktops without half these specs....


Nemo   March 19th, 2010 9:59 pm ET

The point of the Nexus One, although you can get it subsidized by a T-mobile contract with other carriers coming soon, is to offer Americans the opportunity to buy unlocked phones unbundled from carriers controlling death grips. Google doesn't make the Nexus either. It is an HTC brand phone. Neither does google own Android Mobile OS, which is maintained by the Open Handset Alliance. What Google does own is the online store that sells the unlocked handsets without a SIM card. It also owns the Android Marketplace where people buy their apps. Plus it controls all the killer Android apps like Gmail, Gvoice, Gmaps, etc. Presumably other phones will become available on Google's online phone store soon, and Americans will finally, if they so choose, enjoy the freedoms that other customers enjoy everywhere else on Earth but here. BIG changes like changing the entire face of the American mobile industry take BIG amounts of time. Google is not failing. Unlike other corporations they have the patience, time, and money to do something like this and NOT fail. I have an unlocked Nexus One bought using Google Checkout and am using it with T-mobile's Even More Plus no-contract Family Plan with unlimited data and text for me and my wife's Sidekick.


rab   March 19th, 2010 10:43 pm ET

So, Nemo... Any regrets? Any issues about the phone that bother you? Please be honest. I mean, I'm getting it as soon as it hits Verizon and I've read all the hype about touchscreen issues and capactive button issues and purple tint and cracked screens and low-life batteries and 3G issues and "trackball, why?" and the system slowdowns over time and the lack of support and the etc. etc. etc. But I'd like to hear from an owner what's the deal? What bothers you and are you happy with the phone?


Chris   March 19th, 2010 11:24 pm ET

Not surprised about the Nexus One, especially because it's a direct sale and the other issues, namely 3G, that initially cropped up. I bought the N1 the first day it came out to replace the myTouch I had, but ended up sending back because of the 3G issue and the Horrible customer service/response from Google. Thank god HTC was much better with their CS. The speakerphone was also not that good. It's unfortunate, because otherwise the phone was pretty cool. Darn fast and the screen was amazing. I've eyed up again, but Google still hasn't released a car dock, which I desperately needed, and browsing their help forums still seems like they've learned nothing about CS.
I have many friends with the iPhone and if it was available on other networks, I think I would prefer it over the N1, even as good as the N1 is. Sorry, don't understand what's so great about Android OS over others. Not saying Android is bad, but it's not like Apple is some DOS and Android is Win7. Nevertheless, hope something changes soon because I hate the myTouch and can't wait to get rid of.


Seb   March 19th, 2010 11:45 pm ET

I myself think that to buy the phone by itself is too expensive. Only worth it if you are contracted.

Us Canadians must buy the phone from Google WITHOUT contract. I want the Nexus One, but not willing to pay 600$ for it!

Sorry Google. Drop the price or no sale!!!!!


Kyle   March 20th, 2010 12:58 am ET

I agree with first comment , this phone is awesome, it is only on t-mobile right now not a great carrier in my book once the phone can get sold at a reduced rate to sprint and att this phone will explode in sales, i work for sprint and every day we have calls requesting to know when it will happen so i think once other carrier can sell reduced then the phone will rock the States


Ben   March 20th, 2010 1:40 am ET

This story completely leaves out the sales figures for the Droid, which has also sold over a million units already.
Besides, the Nexus is Google's experiment. They wanted to put the option out there for people to buy a top of the line smartphone without being tied down to a single carrier for the life of it. It's not for everyone, and they knew that from the start.
As for the price, smartphone owners are already paying for it, just in different ways. If you look at the contract costs, you're talking thousands of dollars. The difference of $350 from the t-mobile to the unsubsidized version will be almost minimal over the course of two years. As it is for me, the option to get a 3G capable N1 for AT&T is going to save me plenty in the long run rather than starting a new contract with either T-mobile or Verizon.
Google likes playing by their own rules. The Nexus will keep going, but it's never going to get iphone big. That may come in a few years, but not now.


Rob   March 20th, 2010 1:43 am ET

Two points:

1) N1 is not "sold through" T-Mobile (Vodaphone USA), even though its network does support it. Verizon version will be available for sale 3/25, AT&T version to follow.

2) The US is unlike Europe or Asia. The mobile market is fragmented here. The largest carrier is not GSM, it's CDMA. We can never be an open, fluid market like the rest of the world. There's no incentive and not enough capital for one of the big two carriers to buy and assimilate the network of the other, because they would have to convert the whole network. That means the market will remain fragmented.


We do not need Google!   March 20th, 2010 1:55 am ET

I am perfectly happy with my iPhone. I personally think Google.com is the most greedy company in the world and I am happy they are not doing well and they over charge for everything= Greed! Besides that do we even need another type of Cell Phone when the iPhone is already clearly the best and has 40 Million Users and growing. Google.com is too greedy for it's own good and hopefully will implode I support anyone competing with Google.com, Microsoft and BING GOOD for them! Google.com just so not a good company anymore. If they had good prices, lower fees for their services it would be a different story. I hope someone out does Google and Microsoft and Apple at least deserve it.


Antoine   March 20th, 2010 3:00 am ET

Nexus one will fly when retailed by carriers. It is a no brainer.

More increasingly in the blog is the comment on Google vs Bing. Should Bing catching up, it validates Google strategy to own the mobile space. That will sooner or later become an important discovery channel.


Ronald   March 20th, 2010 3:29 am ET

It could be that Google planned for low sales of Nexus One.
Perhaps they did not want to compete too fiercely with other Android phones.

It may be deliberate on Google's part to have sub par customer service and sub par customer support.

Recently I was looking to buy a Nexus One, but after visiting the web site where one purchases the phone, I came to the conclusion that a troop of gorillas could have done a better job of presenting the phone for sale.

If Google wanted to do a good job of selling the phone on the web, they could have hired someone from, say, Amazon to give them tips on customer service.


Jeremy   March 20th, 2010 6:10 am ET

I have the Nexus One and I love it!!!
I have several ipods that I'm happy with, so I was also considering the iphone, But my mobile carrier is T-mobile and after compairing them with AT&T I couldn't make the change. It was a tough decision because I didn't like purchasing something I couldn't touch first and there is NO where you can go to even see a Nexus One in person not even T-mobile stores! I think if Google would put a few Demo models in the retail stores of its mobile carriers they would most definitely have an increase in sales!


Jim Preis   March 20th, 2010 7:45 am ET

Considering how the Nexus One is doing as a barometer for how Google is doing overall is like judging your health based on a hangnail. Google cares about delivery of content because it is though that mechanism that they can place ads. Google is an advertising company or broker as it were. The Nexus One was a toe in the water and it's always cold until the boys go in if you know what I mean. Perfect execution? No. Perfect hardware? No. But Google's smart enough to not allow perfect to be the enemy of good in an exercise that's a learning experience. And the comparison to Microsoft? Microsoft's ONLY bright idea was to license DOS and subsequent versions of OSes as opposed to selling the source code. Microsoft is struggling to get its 2nd (or 3rd) core cash cow – Office – into the cloud; something they should have already completed. Google did this with little effort. Microsoft buys companies that innovate. That is not the same as innovation. Look at Google's portfolio of applications available for free (free in so far as money out of pocket). Look at Google's effort to bring Gigabit speeds to end users. Google TV, please stand by. And oh yeah, the stock's made me a small fortune. If Google's having a rough week, where do I sign up for this kind of rough experience.


sachin   March 20th, 2010 7:58 am ET

The nexus One is definitely required to compete with the iphone. The main reason for this is Apple's reluctance to provide the iphone with other phone dealers. AT&T sucks BIG time, dont believe me ? call up their customer service number. Nexus One's soft spot is the touch screen technology from HTC. It appears to be very sluggish as compared to the iPhone . The pricing and the openness of Nexus One truely portray Google's philosophy of Do-No-Evil. The design and Beauty of the i-phone portray the remarkable artistry which goes into Apple's product design. These are both amazing products and we need both of them to compete hard and bring their prices down😀


Nexus One   March 20th, 2010 8:38 am ET

I think that iPhone jump into the market at the right time. I have an iPhone, but I would prefer if I had the choice to jump to Nexus One. For the reason that it is open to any carrier and no attachements. Also iPhone force users to buy everything through iTunes and that should not be allow. Is monopolizing the phone market.
I do not like Aple because of that. It will be the worse company to control the market.


Froy   March 20th, 2010 9:07 am ET

It's time for google to launch the 3DMobileNetwork
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All can be found at 3DMobileNetwork.com
Google would be number 1 in the industry


photothatdodo   March 20th, 2010 10:40 am ET

Google's Nexus One numbers are actually probably not bad considering the following:

1. There's only one iPhone. There are a bunch of android phones. You don't have to get a nexus one to get the google/android experience.
2. The Nexus One is marketed as a superphone. A lot of people don't need a super phone; they can feel more frugal during these tough economic times by getting just a smart phone.
3. The Nexus one is only sold online. Anyone walking into a store can't buy one and there's no sales staff looking to convince you to buy them.
4. No one walking into a store can hold one or play with one either. This is a crucial part of most people's decision making. When you buy online, you're taking it on faith that you're going to like the product.
5. This one is probably the most important one: The Nexus One is only subsidized by a single carrier, a secondary carrier that doesn't play in all markets and doesn't offer 3G in most markets.
6. Not being subsidized by most carriers means that most customers have to shell out over $500 to buy unsubsidized then find a plan for it. That's expensive and annoying. You have to really be a cell phone aficionado to want to go to that trouble.

So that's Google's market cell phone aficionados. Turns out that there are 74,000 of them. Way to flush out those aficionados, Google. There's no hiding now.

So that should be your real headline: Google flushes out 74,000 most committed smart phone junkies.


Don   March 20th, 2010 10:44 am ET

The phone looks great but what provider(s) will let me use the Nexus on their system *without* having to sign up for a stupid data plan? I've already paid for a wireless connection and don't want to pay again for a service I don't want, need or would use only once in a while. Also – is there any way to "lock" the Nexus from making 3G/4G data access? i.e. any way to insure it's a "wireless data access only" phone?


goo   March 20th, 2010 10:50 am ET

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Clinton Cimring   March 20th, 2010 11:10 am ET

I highly doubt Bing would replace Google in the US considering that Google designed the Android operating system.
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TechFan   March 20th, 2010 11:10 am ET

The iPhone was not Apple's first foray into mobile phones. No one remembers their collaboration with Motorola, arguably Apple's first mobile phone attempt. If the next version of Google's mobile phone can improve with all the learning they are achieving with their first attempt, their next revision of Nexus phone could be very interesting indeed.


Victor   March 20th, 2010 11:24 am ET

I think we cannot compare sales for Nexus One and Droid. Nexus One was available only for T-Mobile which has in 4 times less customers than Verizon. If Nexus one will be available for Verizon you will see a different situation.


xboxer   March 20th, 2010 1:27 pm ET

dont know about failed nexus or whatever and will never bother about it at all..becasue I totally love iphone..and windows phone 7 appears to be headturner...so google's mobile space is just a fad..doesnt matter at all..

their search is good and they should focus on it because bing is better and hitting real hard..not to forget that google with their be evil practices is on its way to self destruction.


Toomb   March 20th, 2010 1:51 pm ET

How can someone call Google greedy when they offer just about everything free minus advertising on Google. They also want to buck the trend that you have to be stuck with a certain provider to have a certain phone.
I have the Iphone and like it, but I don't like how Apple makes us buy through them and they hamstring all these companies that build applications for the phone by setting lots of limitation(think Dragon Dictation). They set all these rules on what apps they "Allow" us to use instead of giving us that freedom. So what we're getting is a watered down version of these App's because Apple has these fuzzy guidelines. We thought Microsoft was bad on how controlling they were and now Apple is doing the same thing but many people think it's OK when Apple does it or there to ignorant to see it.


Zolo   March 20th, 2010 2:25 pm ET

I believe the main reason for the Nexus One's slow sales is the fact that you can only buy it online. Put it in mobile carriers stores where people can get their hands on it, check how it works and feels, and just play with it and sales would greatly increase. That's how the Moto Droid hooked me!


Google Android – The Samsung I7500: To the Galaxy and Beyond by Simon Drew   March 21st, 2010 5:25 pm ET

[...] A bad week for Google? [...]


Nelly   March 22nd, 2010 8:05 am ET

The Motorola Droid is selling very well on Amazon at $25: http://bit.ly/bihgCC

I think the Nexus One would sell a lot better if Google would discount it to almost next to nothing. Or if it would allow other retailers to sell it.


DSA   March 22nd, 2010 1:19 pm ET

I would really like to know why the CNN moderator of these comment areas NEVER lets me post. My posts are ALWAYS deleted.
I adhere strictly to the terms of service. I stay on topic.
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Slick   March 22nd, 2010 1:58 pm ET

LOL and they posted this comment of yours. How funny is that! Haha!


Avrailer   March 23rd, 2010 3:01 pm ET

it is not a personal vendetta you just don't know how to spell... lol


brad   March 23rd, 2010 11:52 pm ET

Who is Google?


DSA   March 24th, 2010 10:58 am ET

Avrailer - you're right. I'm really embarrassed; I usually run these through a spell-checker just to make sure. I hate misspellings.
Besides, things seem to be going through now. Sorry for the OT, it's just been extremely frustrating.
So, never mind. Going away.


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Miryam   October 7th, 2012 11:56 pm ET

yes, i have it on at t. ofcourse the 3G is bteetr than EDGE but i'm just saying i find EDGE pretty fast. I use more wi-fi than edge since im more in my house and places, iphone is faster in internet since it has 3g, but if you connect iphone and nexus one in wi-fi then the nexus one is way faster. the GPS is awesome!! is all instant. It has a lot of awesome features, you could find them on youtube.. NexusOne is faster, it has 1Ghz and iphone have like 500Mhz something like that.


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Are you a gadgethead? Do you spend hours a day online? Or are you just curious about how technology impacts your life? In this digital age, it's increasingly important to be fluent, or at least familiar, with the big tech trends. From gadgets to Google, smartphones to social media, this blog will help keep you informed.

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