There has been a lot of speculation about Google’s upcoming mobile phone, last night it was officially presented: the Google phone is real and can be ordered directly from their website. As interesting as I find this new gadget and would like to play with it once it comes to Europe, what’s even more remarkable about Google’s latest move is the fact that they enter the business of retailing physical goods.
Up until now, Google first and foremost business has been in the realm of making money by shifting electrons: their most important asset – paid advertising – is based purely on bringing together advertisers and potential customers. By means of an Adwords ad for instance, the latter are being forwarded to the retailer’s webstore and fulfill their purchases there. Google collects the fee for this click – business done.
The strategy behind marketing of the Nexus One changes this completely. With their plan of selling their phone directly from their own online store – rather than tying it to carriers, shipping it to their stores and letting customers experience it in real life – Google is offering an unlocked phone without any intermediary (in this regard, Ars Technica has published a piece on how Google’s latest move will affect the US wireless market). In other words, Google will start shipping real products and collect payments via – what else? – Google Checkout.
While surely being a well-equipped smartphone (detailed review by Techcrunch) it is by no means revolutionary; the real news is they way in which Google positions itself in the world of retailing and strenghtens its own checkout service.