Google Could Be Preparing to Offer Its Own Smartphone Models

The search giant is reportedly preparing to offer its own Android smartphones to consumers by the end of 2016, based on its own designs.

Google, smartphones, Android, Nexus, Project Fi, Project Ara, HTC, Huawei

Smartphones designed by Google itself could hit the world market by the end of 2016, giving the company more control and oversight of its hugely popular Android mobile operating system and helping it take on Apple more directly in the smartphone wars.

That's Google's plan for the near future, according to a June 26 story by The (London) Telegraph, which reported that Google will be more firmly moving into the hardware race, based on unnamed sources who are familiar with the discussions.

Google has offered Android handsets in the past through arrangements with manufacturers such as HTC, Huawei and others, but those handsets were designed by those companies and carried Google Nexus nameplates, without Google's own designs. Google has not previously designed and built its own phones.

Under a new strategy, Google "is in discussions with mobile operators about releasing a Google-branded phone" to directly attack the market, the story reported. "The new device, which will be released by the end of the year, according to a senior source, will see Google take more control over design, manufacturing and software."

Android smartphones continued to gain market share in the first quarter of 2016 in the United States, five key European countries and in China, compared to a year ago, according to a May report by analyst firm Kantar Worldpanel ComTech. The figures showed Android phones holding 65.5 percent of the U.S. market in the first quarter, up from 58.1 percent a year prior. Apple iOS smartphones made up 31.6 percent of the market in the first quarter, down from 36.5 percent a year prior. Windows phones captured 2.7 percent of the market in the first quarter, down from 4.3 percent in 2015.

In the combined EU5—Great Britain, France, Germany, Italy and Spain—Android smartphones made up 76.6 percent of first-quarter sales, up 7.1 percent from 2015, according to the study. In the EU5, iOS share fell to 18.9 percent in the first quarter from 20.2 percent a year earlier. Windows Phone sales dropped 5 percentage points to 4.9 percent of overall smartphone sales in the region. About 6.6 percent of new Android customers switched from Windows Phones, compared to 3.3 percent who shifted from iOS phones.

In China, Android phone sales increased to 77.7 percent of the market in the first quarter, up from 71.5 percent a year earlier. Apple iOS phones made up 21.1 percent of the market, which fell from 26.5 percent, while Windows Phones came in at 0.8 percent of the market in the first quarter, down from 1.3 percent in 2015.

By Google having its own hardware lines in the marketplace, the company would be able to better control its Android software, its Google search engine and its Google Play app store, according to The Telegraph.

Google is also working on other related projects at the same time, including its planned Project Ara modular smartphones, which are likely to be released sometime in 2017, according to a May eWEEK story. The customizable smartphones will feature swappable modules for different functions, such as those that let users add a high-resolution camera or an additional speaker to their phones. Google began work on Project Ara in 2013. The Ara phone will consist of a baseplate or frame with a pre-integrated display, CPU, graphics processing unit, sensors and all the functionality of a standard smartphone, as well as slots for six modules.

In March, a Google Nexus handset, the Nexus 5X, debuted as the second phone being sold for use with Google's Project Fi mobile phone services, which start at $20 a month. The Nexus 5X smartphone is made by LG for use with Google's Project Fi inexpensive monthly wireless service plans. The Nexus 5X is priced at $349 for a 16GB model or $399 for a 32GB model.

Project Fi is Google's inexpensive mobile phone service that came out in April 2014 under what was then an invitation-only system. Project Fi phone services recently opened to all users who buy or provide a compatible Nexus smartphone that will work with the service. So far, the Nexus 6P by Huawei, the new Nexus 5X and the earlier Nexus 6 are the only three smartphones that will work with Project Fi's network. Users pay $20 per month for cellular access, plus data fees of $10 per GB only for the data that is consumed each month. The monthly access fee also includes unlimited talk and texting, WiFi tethering and international coverage in more than 120 countries.