Google Jan. 15 pared the price of its Nexus One smartphone by $100 for existing T-Mobile subscribers, an olive branch for customers angered by dual early termination fees and sluggish customer service.
Google sells the Nexus One sans wireless service for $529, or with a two-year service plan from T-Mobile. However, existing T-Mobile subscribers with data plans were being charged $379 for the Nexus One and subscribers without data plans were paying $279.
Now the Nexus One will cost all existing T-Mobile subscribers $279. T-Mobile customers with data plans who bought the Nexus One are being refunded the $100 difference. The Android and Me blog captured a screenshot of the refund in action here. A Google spokesperson told eWEEK:
"Previously there were two price points for those fully eligible for T-Mobile upgrades. Those without data plans were paying $279 for the Nexus One, and those with data plans were being charged $379. We worked with T-Mobile and are now able to offer the higher upgrade discount to all existing fully eligible T-Mobile subscribers. This price is now $279. Refunds will be granted to all eligible subscribers who previously purchased the Nexus One at $379."
The $100 refund is not available to T-Mobile customers who bought the phone for $279.
Google began selling the Nexus One Jan. 5 from its Webstore, a move that was supposed to give the company more control over sales of the device. Google hoped this model would be a launching pad for mobile advertising on its search engine and other Web services.
Experts who warned this new road could be a rocky one were proven prescient; one day after the Nexus One hit the market, customers lit up Google's support forums with complaints about poor 3G service from T-Mobile and a few other issues.
Perhaps the most common of these concerns was the question of whom to turn to for help: Google as the merchant of record, HTC as the device maker or T-Mobile as the service provider.
That isn't the only issue bothering new Nexus One customers these days.
The Phandroid blog Jan. 11 read the fine print on Google's Terms of Sale for the Nexus One and found that consumers who buy a subsidized Nexus One through their carrier and cancel the account before 120 days must pay Google an equipment recovery fee on top of the early termination fee they would pay to their carrier.
The ERF is the difference between the full price of the Nexus handheld device without service plan, which is $529, and the price of the subsidized device, in this case $179 from T-Mobile. That means T-Mobile customers who buy the Nexus One at the service price and cancel before four months have to pay Google $350 for its ERF and pay T-Mobile $200 for its ETF.
Topping all of this off is that Google only sold 20,000 Nexus One units in its first week, far below the first week sales of the Motorola Droid and myTouch 3G Android phones.