Citing sources familiar with Google's plans, the Wall Street Journal reports the impetus behind this change is to give Google more control over what features and applications are available on the handsets. Google hopes to sidestep the level of control exerted by wireless network operators, who often install their own apps and services on smartphones they sell with wireless contracts.
[ For more on Google's acquisition of Motorola, see Google Debates Fate Of Motorola Smartphone Business. ]
Google first sold the Nexus One, which was made by HTC, directly to consumers without a contract via a dedicated website in January 2010. The device was sold at full retail price and initially worked with T-Mobile USA's network. Less than a year later, Google shut the program down due to low uptake on the device. Google found out what Apple did: selling smartphones at $500 or $600 a pop isn't easy. The subsidies provided by wireless network operators are able to bring smartphone prices down to a more palatable $200 or $300.
Last month, Google resumed direct-to-consumer sales of the current Nexus device, the Samsung Galaxy Nexus. It is being sold without a contract and can be used on the networks run by AT&T and T-Mobile USA. It can be purchased from the Google Play Store for $400.
To date, Google has always stuck with a single manufacturer for Nexus devices. Why change to five? There are at least half a dozen probable reasons:
First, providing early access to five OEMs should abate fears that Google will give preference to Motorola's hardware division, which it is in the process of acquiring. Many are wary of how Google's relationship as Motorola's owner will play out. Though Google has gone on the record saying there will be a "firewall" between the Android software and Motorola hardware teams, spreading the Nexus love to other OEMs should put those concerns to rest.
Second, it should ease Google's relationship with handset makers that may feel left out of the "lead device" Nexus program. So far, HTC and Samsung have been tapped for Nexus devices, while other Android manufacturers such as Motorola, LG, Pantech, Huawei, Sony, ZTE, ASUS, Dell, and others have been left out. Were Google to continually stick with one OEM, it could foster resentment. This should help in that regard.
Third, Nexus devices should receive system-level Android updates faster, which makes for happier customers. Historically, Google has provided major new versions of Android to its base of Nexus devices before other devices. Case in point: Google updated the Nexus S to Android 4.0 Ice Cream Sandwich long before other OEMs and carriers rolled out the Android 4.0 update to their devices.
Fourth, it will prevent carriers from blocking apps. As the Journal points out, Verizon Wireless has blocked Google Wallet from the Galaxy Nexus device that it sells. Blocking this app prevents Galaxy Nexus owners from using Google's mobile payment service, which it is trying hard to expand.
Fifth, fans of the stock Android experience will have a much better selection of handsets. Under the current model, the single Nexus device is typically the only one available that hasn't been modified by the carriers. With five stock Android devices available, those who prefer the unadulterated code will enjoy greater choice.
Last, it could help boost sagging sales of Android tablets. Google is reportedly working with ASUS to bring a low-cost Android tablet to market, which it intends to sell directly to consumers via the Google Play Store. With stock Android tablets that don't require carrier contracts available at low cost to consumers, it is possible consumers will go to Google for their tablets rather than other low-cost providers such as Amazon or Barnes & Noble.
According to the Journal, all this is going to be up and running by Thanksgiving. Google will likely reveal more details at its I/O developer conference, scheduled for next month.
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