The Google online store showing the NexusOne
I must be honest to say that I didn’t follow the whole Nexus One hype too much. Maybe that’s why I was surprised to read on the Engadet’s live blog of the Google Android press conference that Google is launching an online store where (in the future) you can buy more devices, with service plans of different operators.
As far as I know this is a departure from the existing model where you had to go to a specific operator that had a service plan for the high-end phone you wanted to buy. Since operators always were the major players in marketing and selling the devices, they always have had a lot of power over phone features. Further, with only one or a few operators providing a plan for your mobile device of interest, operators weren’t pressured in the market. Next to their intrinsic control over their networks, this gave them a lot of power over what you could or couldn’t do with your device, especially related to mobile Internet applications.
Now, with Google selling the phones independently and multiple operators stepping into Google’s online store program, the power of operators is diminished. They will have to compete more by giving consumers better data plans, more open access to their networks & bandwidth, and further, they have less to say about phone features.
For Google this online store must thus be an obvious move; it will give Google more freedom to roll-out new mobile hardware & software solutions and a better position to negotiate good service plan deals with operators. Ultimately, this will support Google’s efforts to get more mobile users to use their web service & application innovations, which in turn implies more revenue for them.
I think this is a very good move, not just for Google but also for the users of mobile Internet devices (that’s a lot of people, especially in the future!), operators have been slowing down innovations in this area for too long if you ask me. Probably with the advent of the iPhone they started to realize that a lot of money can be made pushing data around for users on the move. This is also why I think T-Mobile, Verizon and Vodaphone already agreed to take part in the Google store progam.
I wanted to post this as a short comment on my three tweet blog but the post became too long so I promoted it to web2society. Please let me know if I missed anything important that should have been refelected in this post. I’m also interested in your opinion on the strategic importance of the Google online phone store.
Tags: business model, Google, innovation, mobile, Nexus One, online store, open network, operators, strategy
