Google Sells Only 20,000 Nexus Ones in Week 1
If one were to simply judge the Google Nexus One smartphone by its first week of sales, it would be, well, a dog.
Such as it is, however, mobile analytics company Flurry said Google sold only 20,000 units of the Nexus One in its first full week selling it through its Webstore for $529 unlocked or $179 through T-Mobile with a two-year service contract.
By comparison, Apple sold 1.6 million iPhone 3GSes in that device's first week. The Motorola Droid sold 250,000 units backed by a strong, cyborg ad campaign. T-Mobile shipped 60,000 copies of the MyTouch 3G, the second Android device in the United States.
Here is Flurry's chart:
So, why has the Nexus One fared poorly compared with these devices?
In my opinion, the device was unwisely overhyped once Google gave it to thousands of employees for dogfooding. It created such a buzz vacuum that blogger corps, including yours truly, were compelled to research, pontificate and write about it ad nauseam.
Flurry has other reasons, noting that while Verizon spent $100 million on marketing and advertising the Droid during the holiday season in November 2009, Google sold the Nexus One only online, missing the holiday exposure and corresponding sales.
Somewhere, Motorola CEO Sanjay Jha, reported to have been burned by the Nexus One launch, is smiling.
Flurry also speculated that the MyTouch 3G is cannibalizing Nexus One sales, though I doubt this happened much in the course of one week.
Of course, the T-Mobile 3G service issues and Google's inability to field complaints in hours instead of days aren't helping matters.
Google is also getting negative attention for charging an Equipment Recovery Fee to those users who decide to cancel their T-Mobile service contract within the first four months.
This is unfair because Google is only protecting its investment. Still, it's another hitch that could prevent Customer X from choosing a Nexus One over an iPhone or MyTouch 3G.
Overall, I can't say I'm shocked by the Nexus One sales after week one, and people are likely wary of and uncomfortable with buying a smartphone over the Web on the SAAS (smartphone as a service) model.
Forrester Research's Charles Golvin and Gartner's Ken Dulaney told me this could be a sticking point for Google going forward.
I suspect that when people get comfortable buying smartphones from Google the same way they buy books from Amazon.com, then the Nexus One, and subsequent Nexus devices, will prosper. Flurry noted:
With each consecutive Android launch, consumers are enjoying more choices in the market. The flipside of this, however, is that it will take increasing innovation and decreasing price points to attract new smartphone consumers.
Agreed, but a bigger question may be, How much time does Google have to narrow any gap between its smartphone line, Webstore and platforms, and devices from Apple, RIM, Palm and Symbian?
These vendors aren't sitting still either.