How did Google get to this spot?
Google's little experiment to sell Android handsets online directly to consumers was a failure from the start. It just didn't work. With partners Verizon Wireless and Sprint throwing in the towel on the Nexus One completely before the device even launched for their respective networks, there was little reason for Google to keep the store open.
Google's Andy Rubin said in May, "As with every innovation, some parts worked better than others. While the global adoption of the Android platform has exceeded our expectations, the web store has not. It’s remained a niche channel for early adopters, but it’s clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to chose from."
Google made the right call with this decision. It is one thing to sell a device online that customers at least have the opportunity to see in real life somewhere else (such as a store). But when consumers can't put their hands directly on the thing that they are going to buy, things get tricky.
Phones are extremely personal devices. I would never recommend that anyone buy a mobile phone sight unseen. It's just not a good idea. Why? It's something you spend hours with each day. It has to be good, it has to be what you want.
When Google first announced that the Nexus One online store was going to be shuttered, it said that the device would eventually be available from brick-and-mortar retailers. To-date, however, the big national retailers (such as Best Buy, RadioShack, etc.) have remained mum on the Android handset's availability. Google's latest word on the subject only implies availability in Europe, though developers will always have access to the Nexus One through the Android developer program.
Despite the failure of its online sales model, Google has maintained that the Nexus One was a profitable business.