Analyst Says iPhone Success Guides Google's Nexus One
Bernstein Research analyst Jeffrey Lindsay said in a research note that the phenomenal success of the iPhone, nearly 10 million units of which will ship through 2009 and whose Apple App Store offers more than 100,000 applications, has forced Google to take actions into its own hands in the smartphone market. Specifically, Google is creating the Nexus One as an unlocked alternative to existing Android phones, such as the successful Motorola Droid, to better challenge Apple's iPhone dominance. BroadPoint AmTech analyst Ben Schachter sees Google's move as a disruption in the space.The unstoppable success of Apple's iPhone has pushed Google to create Nexus One, a smartphone based on the Google Android operating system whose software and features Google has built from the bottom up on hardware from HTC. So claims one analyst. Nexus One, which Google employees are testing, is expected to come to market early next year, possibly in January, and allegedly with support from T-Mobile USA. However, the device will be based on GSM technology and will be unlocked, meaning users can pick their carrier to power it.
Bernstein Research analyst Jeffrey Lindsay said in a research note that the phenomenal success of the iPhone, nearly 10 million units of which will ship through 2009 and whose Apple App Store offers more than 100,000 applications, has forced Google to take actions into its own hands in the smartphone market.
"We do not expect just another smartphone to compete with the iPhone. We think Google will try to change the current model and influence the development of the mobile Web in a more fundamental way. That could be through some sort of advertising supported economic model, a mobile device more focused on data than voice, the unlocked feature, etc. "At the end of the day, this will not be a phone in the traditional or 'smartphone' sense. We think it will be a mobile device that tries to challenge current business models, notions of data versus voice, and how consumers should pay for mobile services."In controlling all of what goes into Nexus One, Google could create a mobile ecosystem where all of its various services/applications run without breaking from fragmentation. This would include tighter integration with Google Voice, GPS-enabled directions and mapping, location-based mobile advertising, and mobile searches. Schachter said that while it is too early to predict how these models will evolve, Google might be able to make a lot of money from ads associated with mobile Web services, which would help it fully subsidize the cost of the phone for users.