Why I Think The Google Nexus One is a Mistake

At this point, everyone should know the details about Google's Nexus One phone, which is basically Google's copy of the iPhone running Android.

Nexus One is basically Google's answer to the iPhone; there is an Android app store, and features that are altogether too similar from the Cupertino-based phone. Google thinks that there is a market for those who want an unlocked smartphone without a contract, and I agree, but a first phone is not it. How many poor saps who bought a Motorola ROKR tied to AT&T regretted that decision when Apple's iPhone was unveiled in 2007? Those that purchased the ROKR are exactly the same followers who would buy a Nexus One -- those that are early adopters or the company faithful; I honestly don't see much over that.

Sure, the Nexus One is a capable phone, but when you get down to it, the Nexus One running Android is really no different from any other Android-based phone on the market. Verizon has the DROID, Sprint has several Android based phones, and now T-Mobile has the Nexus One. AT&T, because of their exclusive deal with Apple, hasn't started distributing Android phones yet, but it's just a matter of time; eventually, Android might eventually become a dominant force to be reckoned with, but for now, the smartphone market is dominated by Apple, and then RIM.

RIM has a faithful following, but will eventually lose ground, as Android begins to take off; at that point, people should be squarely in the Apple camp or the Android camp; both will have features so similar, that at that point, it becomes a matter of preference, and it is likely no more than 3 years from the point that people will be making that decision.

Apple meanwhile will dominate on their iPhone platform. The key to winning the next battle in the war of smartphones is being able to attract the typical consumer, and I think of the three major phone types (Apple, Android and RIM), Apple is by far the most user friendly, and the cheapest, which are two very big advantages. However, despite the usability, cheapness trumps all (in fact, when we think of free, even cheap options are overtaken by the notion of free), which lends the possibility that free phones would take away market share from other smartphones. The only problem is, there's no such thing as a free smartphone.

Googles Nexus One hits on the free notion alot; the phone is unlocked. You can take it to any carrier you want, for a one time charge of $530, and have a contract free phone for just the monthly cost.. Interent access is $40 a month extra, on top of the $40 you would pay for normal service with T-Mobile. The big problem is that people don't want to pay several hundred dollars for a phone, and they shouldn't. In the United States, Americans have become accustomed to the subsidization that phone companies offer phones in exchange for a two-year long service contract.

For the past seven years that I have paid for my own cellphone, I've only ever had one carrier: Cingular. This is not because I love Cingular (which merged with AT&T), but rather because no phone could ever entice me to change carriers, and up until recently, cellphone reception was decent enough that I didn't feel it necessary to switch providers.

Here's the thing: it doesn't make sense to change carriers for a phone unless a phone is so superior to the phones on the market that you cannot live without its features, and that phone for me is the iPhone. All the other smartphones on the market are imitations of the iPhone, and it's quite foolhardy at this point to try competing against the beachhead already secured by the iPhone. However, this is exactly what the Nexus One is trying to do, and despite the Google branding, I don't think the Google Nexus One is really ready to go head to head with the iPhone.

Here's the big problem. Within Apple, they have product cycles down pat; a new iPhone every year has been their trend; for Google, there are so many different manufacturers running Android on their handsets now that the Nexus One will be outdated in a matter months, whereas the iPhone is guaranteed a year before it is cycled out. This makes paying the subsidized cost of a smartphone a little easier to swallow, as the outdatedness is only a year, and usually not by any substantial amount; the differences between iPhones from year to year are expectedly, pretty minimal which means that you don't feel as bad when the next model appears. The same is not true for Android phones, which have such a varying degree of capabilities that the Nexus Two could be out in 3 months or 6 months or 9 months it could be out in 3 years, or it might never be out.

It might not matter too much if you've got a two-year contract with the carrier, but what if you bought the unlocked phone, how long does the unlocked consumer expect to use it? A week, a month, 6 months, longer? That initial cost is enough to discourage many a consumer just because $530 is perceived as a lot of money for a phone that one might use for 2 years, when they are accustomed to paying nothing for the phone.

In my opinion, a smartphone shouldn't be bought unless it has a long and useful lifespan as a gadget; and that's the real problem with the Nexus One -- just how long it will last.

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