Are Google Nexus One Sales As Slow As They Seem?


Now that Google's Nexus One is in the wild, its ongoing sales strength will be closely monitored. And a few early sales estimates suggest Nexus One sales have been slow out of the gate, at least compared with the launches of other smartphones with which Google's phone now competes.

A report published Wednesday by mobile researcher Flurry estimates that Google's week-one sales of Nexus One -- the phone debuted on Jan. 5 -- were about 20,000. Compared to launches by Apple's iPhone 3Gs (1,600,000 in week one), the Motorola Droid (250,000 in week one) and even the MyTouch 3G (60,000) in week one, the Nexus One's initial numbers are paltry.

Are the numbers misleading? As Flurry itself points out, Google's go-to-market strategy with Nexus One was different than all of those other phones.

Google in effect soft-launched the phone without the benefit of, say, the $100-plus million marketing campaign Verizon mounted for the Droid launch last fall. Google also skipped the holiday season, choosing to launch its phone at the beginning of the calendar year, which Flurry admits "adversely affected sales."

But it may just be that Google's lack of retail experience is creating ongoing issues with customer service, from angst over its early termination fees to questioning its distribution methods. Either that, or the Nexus One phone itself just isn't a game-changer.

"As a product, the Nexus One boasts the most advanced Android OS to date as well as unique features, such as Google Voice and Google Maps," wrote Flurry researchers. "However, potentially due to the heightened 'promise' created by early buzz, the handset has ultimately fallen short on sales expectations.Without the 'wow factor' now expected with each new challenger to the iPhone, especially the first smartphone with Google's own branding, demand generation has been modest."

Other analyst sales projections are in line with Flurry's categorization of Nexus One as slow. Doug Anmuth with Barclays Capital earlier this week predicted Nexus One sales of between 5 million and 6 million units in 2010 -- a far cry from the 36 million iPhones many are predicting and the 13 million Motorola smartphones. Still, those numbers, as Anmuth pointed out, would be an improvement compared to how previous Android phones matched up against iPhone.

It's a stretch to think Nexus One will damage the Google brand, especially as it relates to Android, Google's mobile OS and a mobile platform expected to grow by leaps and bounds in 2010. If Google gets its retail operation right and keeps the Android developer and app community growing, will the strength of its Nexus One phone sales even matter?