Nexus One: Smartphone revolution still on hold

Apple paved the way, and with its new Nexus One, Google is following. But there is a way that Google could really lead.

HTC's Peter Chou with Nexus One
Peter Chou, CEO of Nexus One maker HTC, holds up the phone. Josh Lowensohn/CNET

Google's Nexus One (complete coverage) is just a phone. It's a good phone, but does it break new ground for consumers? Not so much. Looked at in context of the history of mobile phones, it's a solid step in Google's continuing assault on new markets in general and on Apple in particular, but it's not revolutionary the way the iPhone was, and not, to my mind, worthy of the frenzy that I awoke to this morning on the blogs.

Of course, the Nexus One has solid consumer advantages over Apple's phones. In the U.S., it doesn't run on AT&T, for one thing--you can get it on T-Mobile (now), Verizon (in the spring), or unlocked. It looks like it has a better screen, and it has active noise cancellation and voice control, both very cool. It has nice integration with online services like Google Maps, Facebook, and Picasa. For industry watchers, the Android platform's openness is important. Developers don't have to funnel their apps through the Google, and the platform itself is open to other manufacturers, which can lead to rapid product innovation.

But none of these features is as important to the industry as the iPhone was. The iPhone was the first smartphone to really bring consumers to the mobile Web. The Android phones are riding that wave. The iPhone's second act--the App Store--changed the way applications are distributed and priced. Android is riding that as well.

The iPhone is also a great iPod and iTunes client, and Android doesn't yet offer a competitive experience.

The Nexus One, as shown on Google's product page. Google

So is the Nexus One a revolution? No. And it's a shame, since Google could--still can--upset the mobile phone market to benefit consumers. This revolution would be economic. With Google Voice, its end-run around traditional phones and voice mail, and with its newly acquired VoIP platform Gizmo5, Google could create a mobile phone infrastructure that upends the traditional lock-in and cost structure that cellular companies impose on consumers. Of course, someone still has to run the data networks and get paid for that, but we've seen businesses that hide that relationship from consumers already. MVNOs (mobile virtual network operators) like Virgin Mobile resell other company's cellular bandwidth, and connected e-book readers like the Kindle and Nook hide their mobile carrier relationships as well.

Google execs have said they have no plans to compete with their carriers, and it would be economically unsound for the company to do so now, when the company needs carriers for bandwidth, marketing, and distribution. But as the Apple iPhone has demonstrated, on the marketing side that need is diminishing. With the Nexus One, Google is pulling an Apple. It's pushing the carrier relationships down the marketing stack by running its own Nexus One store, on which you choose your phone first, and the carrier second, and where you pay for the new product with your Google account.

I'd like to see Google take over the monthly billing and let its users switch carriers at will or manage the reselling and switching of bandwidth effectively so users don't know or care which carrier they're on (or none at all--think Wi-Fi and VoIP). Freeing U.S. consumers from the yokes of the carriers would be the real revolution. Selling a $529 unlocked Nokia-like version of the phone is a tiny step forward, but it's not a mass-market solution to carrier woes. Google could do more.

 

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