Making sense of Google's high Galaxy S4 price tag

When Google announced its exclusive version of the Samsung Galaxy S4 at Tuesday's keynote, many were left wondering about its $649 value.

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On Tuesday, when Google's Vice President of Android Product Management Hugo Barra told a crowd of nearly 6,000 attendees that the online giant would be releasing its own variant of the critically-acclaimed Samsung Galaxy S4, many broke out in applause.

Not only would the top-tier device sport all the same desirable specs the GS4 was already known for (like the quad-core Snapdragon 600 processor and Android 4.2 OS), it would also give Android purists/TouchWiz haters, an unsullied Nexus software experience.

Yes, there was clapping all around (and even a "woot!" or two) until Barra added, "This version of the Samsung Galaxy S4 will be on sale starting on June 26 on Google Play for $649."

If you were there, or watching the live stream, you'd have noticed the silence that quickly blanketed the room, followed by a self-aware wave of giggles that audibly confirmed what everyone was thinking: "lol wut?"

First, a little bit of context
In actuality, however, $649 is not at all unreasonable for an unlocked GS4. It was surprising, of course, given that Google's last flagship, the LG Nexus 4, cost just $349 for the same 16GB capacity, but not unreasonable.

For one thing, the device already costs about that much off contract. At regular price, you can get the 16GB model from AT&T for $639.99, or from T-Mobile (which went completely prepaid) for $629.99. The only way you could get it for less is if you sign up for a two-year carrier contract (a no-no for some buyers), or, you know, steal it (which I don't recommend).

Samsung Galaxy S4 Nexus UI
Google's Samsung GS4. Seth Rosenblatt/CNET

You'll have to determine for yourself whether that sounds worth it to you , but know that high-end, contract-free handsets usually fall in the $500-to-$600 price range. To put it into perspective , an unlocked HTC One costs $574.99, and an iPhone 5 cost the same price as Google's GS4. So really, the $600-plus price isn't that unusual. Now, whether or not all these handsets' hardware parts justify these prices is another matter altogether, and it'd be an interesting discussion to be taken up at another time.

But what about that high-end $349 Nexus 4 then?
Oh, right. About that. Therein lies the real question. Honestly, no one's quite sure why that handset was so inexpensive (then again, it wasn't like anybody was complaining). Is it cheaper to manufacture? Is it made of less expensive parts?

It's important to keep in mind that Google commonly takes a big role when it comes to introducing a Nexus phone, as it did with the original Nexus One and the Nexus 4. And so it would make sense that Google, not LG, had the biggest say for the handset's price.

But as we all know, the Galaxy family is a different beast and is Samsung's pride and joy. Therefore, because the GS4 is unquestionably not a Nexus handset, it'd be logical to infer that the Korean company had a bigger role in determining how much the GS4 can cost.

Another thing to consider: the Nexus 4's main draw is that it's trying to be as globally appealing as possible. The fact that the device lacked 4G LTE -- a network speed that's not widely available in many other countries -- was a good indicator that Google was looking beyond the U.S. Add that to a competitively low price and the Nexus 4 had all it needed to be an international hit. (By the way, it did go on to be one of the most popular Android phones of the season.)

Unfortunately, Google's GS4 won't have that same sweet, sweet price tag -- but does it matter? Judging by how popular the GS4 already is, and how high the demand is for a vanilla Android experience, it's safe to assume that this GS4 will do just fine on the market, and that its price is no death sentence.

 

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