Bad News for Google: Nexus Phones Still Don’t Sell

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Phone makers typically don’t talk sales figures unless there’s a reason to brag, or in the case of Samsung, unless they’re forced to reveal their secrets in court.

Thanks to the case of Apple vs. Samsung, we now know the sad truth about Samsung’s Galaxy Nexus: After two quarters, the phone only captured 0.5% of the smartphone market at most, and brought in a mere $250 million in sales revenue, Bloomberg reports. Given that the Galaxy Nexus never cost less than $349 at unsubsidized rates, the total units sold is far less than a million, compared to 10 million of Samsung’s Galaxy S III and at least five million of the Galaxy Note.

(MORE: Apple Wins Ban on Two Android Devices: What It Means for You)

Weak Galaxy Nexus sales aren’t a huge problem for Samsung, which booked record profits last quarter and is the world’s top-selling phone maker. It’s a much bigger issue for Google.

“Nexus” refers to devices that offer a pure Android experience. While most phone makers customize Android with unique layouts and features, and load up the device with various apps and services (a.k.a. “bloatware”), on a Nexus device the experience that Google envisions for Android is exactly what you get.

Techies tend to like the Nexus concept, but it’s never been popular in the mainstream. Then again, Nexus devices never had a fair shot until late last year. Before that, only T-Mobile and Sprint would subsidize the phones, and their retail availability was limited. The Galaxy Nexus, however, was more like a true flagship phone, sold by Verizon Wireless for $300 with a two-year contract. It hit store shelves during the holiday 2011 shopping season with TV ad campaigns in tow. Despite that, it didn’t sell.

The poor performance confirms what I’ve long suspected about stock Android: Most people don’t know what it is and don’t really care. They’re more interested in other factors, like price, design, camera quality and software features. The primary advantage of a phone that isn’t larded up with gimmicks — that it’s more likely to get software updates in the future — isn’t obvious to the average shopper.

In the past, a poorly-performing Nexus wouldn’t have mattered. Google always insisted that Nexus phones were primarily aimed at app developers, and used as lead devices for demonstrating new Android software. Even if Nexus phones weren’t commercial hits, they still served their purpose.

(MORE: Nine Possible Explanations for the Lousy State of Android Tablet Apps)

But now, that purpose has changed. Google sees its Nexus devices not just as tools for developers, but as a way to promote its own content and branding to consumers. Why else would the company sell its Nexus 7 tablet at practically zero profit, and get it onto the shelves of GameStop, Staples, Office Depot and elsewhere? It’s all about pushing that Google brand as a viable alternative to Apple’s iTunes and Amazon.

We saw more evidence of this earlier in the year, when Google started selling the Galaxy Nexus on its website. “We want to give you a place to purchase Nexus devices that work really well with your digital entertainment,” Andy Rubin, Google’s senior vice president of mobile and digital content, wrote in a blog post (emphasis mine). The branding push also explains why the Android Market was renamed to “Google Play” this year — an umbrella term that covers apps, movies, music and books.

When phone makers tweak Android for their own purposes, they dilute the Google brand. Sure, the Google Play Store is still available on most Android phones, but it shares space with apps like HTC Watch, or the Samsung-owned mSpot, or whatever media apps the wireless carriers decide to stuff onto their devices.

If Google wants its content ecosystem to grow, it needs to take back some control by getting people interested in Nexus phones. Instead of going for the high-end, perhaps Google should try to repeat its strategy with the Nexus 7 tablet, and offer a phone with killer price. If Google can find a carrier who will practically give the phone away with a two-year contract, it’ll be impossible to ignore. And If the stock Android experience is good enough — and with Android 4.1 Jelly Bean, it is — the average shopper may finally bite.

MORE: Is Google Readying a ‘Nexus’ Android Invasion?

35 comments
iFranquinet
iFranquinet

@Vopium Plastic Fantastic with sub-standard specifications.. no wonder!

ice15
ice15

I wanted to get a Galaxy Nexus, but my carrier doesn't subsidize it...

Hoping the 2012 Device will look better and subsidized by M1.

mavericksun
mavericksun

Very poor article.

1- Verizon Galaxy Nexus was launched in Dec 2011 versus Galaxy S3 in May 2012. You are trying to compare tech specs on phones that were not launched at the same time.

2-Galaxy Nexus was first launched by Verizon and then Sprint months later. The GSM version was only sold by Google in the US. Galaxy S3 is carried by all four major carriers in US at launch.

3-Marketing budget for Galaxy S3 is a lot more than Galaxy Nexus. 

4-Comparison of Nexus 7 and Galaxy Nexus is just dumb.

      I-Tablet versus phone.

      II-Nexus 7 was released to promote the content and to go against the Kindle and Nook. 

      III-Marketing budget for Nexus 7 was a lot more than Galaxy Nexus. There were commercials on TV for the Nexus 7.

      IV-Nexus 7 is placed on the Google front page.

5-Android is successful because the manufacturers use it. To use Nexus as a way to conquer the phone market is just going to piss off the manufacturers. Especially when it's only one manufacturer per year. The competition from the software of manufacturers will only improve the overall experience of it. What people like will be incorporated in successive generation of the android phones.

6-Google is expanding AOSP to include multiple manufacturers at once(5 Nexus devices this year) .

      I-More Nexus label phones. Experia Nexus, Optimus Nexus, and Galaxy Nexus II.

      II-Possible to limit control from carriers on phones. Which is the major cause of delays of OS updates.

Jonathon Olson
Jonathon Olson

I think a big reason they don't sell is the lack of publicity and advertising this (or any Nexus) phone got. You said there were commercials, but I never saw one and I watch quite a bit of television. The only place I saw ads online were on tech sites and most people in the tech world, as you pointed out, already know and (mostly) love the Nexus brand. Then look at the GSIII, I can't go one commercial break without seeing one if not two commercials for it, there is one before most youtube videos I watch these days, billboards, ad banners on nearly every site I visit, it is impossible to not see that phone. When people go into the store they have never heard of, or seen the GNexus and will automatically shoot it down because it isn't 'this phone or that phone' that they see on TV all the time. If Google really wants to make this product a true flagship for Android as a platform that sells like one they need to out more into how it is advertised, or rather, advertise it at all. This point can be proven by the iPhone's massive sales even after all the competition left in in the dust after the i4. They know how to advertise things and hype them up like no other company, so everyone thinks it is literally the latest, greatest, must-have even when it is really light years behind and hardly worth the much higher price tag. A phone with the iPhone's specs would sell as a mid range Android device at best, starting at a low $199 on contract and being near free within six-months, yet the world still calls it the best smartphone on the market, simply because Apple made them believe it. Google, take note if you want the Nexus brand to succeed the way it could, and should. This is the one phone that they get to show the world exactly what Android is, how it was intended to look and function. They should back it more than they are and maybe they would convince more people to jump ship.

Mike Gill
Mike Gill

The Nexus line would sell great if Google stopped partnering with Samsung who treat the phone like a bastard offspring. They release it with second rate parts, poor battery life; while there own branded phones with crapwiz receive great specs!.

acermunber1
acermunber1

my nexus phone with the jellybean upgrade is my first experience of andriod. what a great way to start using andriod phones.  at the top

Jonathan Hernandez
Jonathan Hernandez

i think if google does decide to release multiple nexus devices with its partners they should release devices with top of the line innovation from form factor down to the specs. use it as a showcase for each companies unique style and technologies for the year. nexus devices come out as suped up badass devices each unique and equally powerfull in specs. 6 months down the line the companies flagship device is released with greater specs innovation and corrections on flaws or just simple improvemets ie the GS3. 

Manuel Avellan
Manuel Avellan

 

How can their flagship phone not have jelly bean yet? specially with all

the rave reviews it is getting. It boogles the mind.....

Manuel Avellan
Manuel Avellan

"It's my bad"  really?  Is this the new way a professional writer for Times, express himself?

Hell I was going to remark on the article, but I am still stumped on My bad. 

Bubba get a clue, you are not writting about popular culture, you are giving your professional opinion on technology, please use better language than me. 

Concerning the article, I believe that until Google does not get how important it is for us to get timely updates for the OS, there phones will be relegated to second place and frowned upon by those of us that love technology.

You know how long I have been waiting for an update to ICS for my Motorola Atrix 2? all I hear is, " It's coming, it's almost here, sometime in September, we saw a photograph of it in a journal, etc, etc"  It is extremely frustrating.

How can their flagship phone not have jelly bean yet? specially with all

the rave reviews it is getting. It boggles the mind..... And what does Google say on their page?

"Soon you can get Jelly bean, it's coming, i promise and the check is in the mail, and I promise I wont........etc, etc

M C
M C

Mr. Newman: You do realize that the GN model offered in US was initially offered only to Verizon?

Compared that to Canada: the HSPA version of GN is available from nearly all carriers.

And to follow up our conversation on Twitter, you said $250M is the worldwide sales figure for all Galaxy Nexus around the world and I respectfully disagree with that. Here's my calculation:

- Google stated (near the end of June 2012) that there are 400M Android devices activated and 1M activated more per day. So let's assume there are 430M Android devices by the end of July 2012. [https://plus.google.com/+Andro...]

- According to Android Developer Dashboard, 0.8% are running Jelly Bean. Most likely these devices are Galaxy Nexus. Assume the proportion of sales between different Android devices remains the same, This equates to 430M x 0.8 = 3.4M Galaxy Nexus on the market.

- Even calculated at the price of $349 per devicev (currently sold for at Google Play), these 3.4M of GN would worth almost $1.2B.

itlog gan
itlog gan

Have to agree that there seems to be no push for this phone to go big. Am in HK and there were no evidence of advertising dollars spent to promote this phone compared to the S3.  When I decided to get one of these last May, stocks were no longer available from local authorized distributors nor telcos.  I had to order it online from a grey importer.  Local telcos were saying to wait for the S3.

MinnesotaGregger
MinnesotaGregger

They have this thing for $99 at Verizon- they started advertising that about 2 weeks ago I think. That's about as cheap as you can get for a full featured dual core smart phone... I think the real reason that it is not selling is that the reviews people are giving it are TERRIBLE. My wife has one and it is afflicted with the same problems that are all over the web- drops calls, slow gps, drains battery excessively... It has not been fun and the delays in updates through Verizon only make it worse. The camera seems fine- it has a no lag shutter which is great.

cooldoods
cooldoods

I think the Nexus is in a good place, it really wasn't meant to be in the mainstream but rather targets techies and developers who want/need the latest version of the OS and supported hardware. The OEMs are allowed to embellish, improve, make sacrifices, and creatively price based on their business strategy when creating their own products. That is the beauty of the Android platform.

The rumours that there will be multiple manufacturers doing a Nexus device this year is welcome as it shows each of them to put their own design DNA on the device while offering a stock OS experience. I'm sure this is something fans of specific brands will appreciate.

Jardin J
Jardin J

SAY IT AIN'T SO!! 

I love my Galaxy Nexus on Sprint. I was hoping they would do well and lead the way into a new generation of "less is more" tech, without all the extra nonsense most companies put on the devices.

So much for that dream.

Alex Cotman
Alex Cotman

Currently running JB on my Galaxy Nexus....still couldn't ask for a better phone. Picture quality is amazing now (took a panorama in the OBX and my god was I blown away at how crisp it was). 

Jason H. Fuller
Jason H. Fuller

Honestly the #1 thing that keeps me away from the nexus line is the Samsung logo.  If it were made by pretty much anyone else (aside from maybe RIM) I'd probably buy it, but Samsung is notorious for using cheap crappy hardware and only placing value on fluff features (like how much it looks like an i-phone).

Abdallah Al-Hakim
Abdallah Al-Hakim

The main advantage of a Google Nexus phone for me is that it represent the best guarantee of recieving latest Android OS updates. This is important for me - others prefer hardware and they will probably go for Samsaung S3 or HTC One X. Having said that, I do think that Google Nexus is a nice piece of hardware and as @facebook-15800772:disqus alluded to is not advertised much which might contribute to it lack of praise

chromaniac
chromaniac

This could change with the reports of multiple Nexus devices coming out later this year... 

I mean as of now, Google partner with one company to launch a Nexus device. And these companies prefer to cripple the device to save their own models. 

I mean Samsung canceled the launch of Galaxy Nexus in India to avoid hurting the sales of S2, Note and the S3. Galaxy Nexus launch in USA was a mess because of Verizon exclusivity. 

Competition amongst multiple companies to offer the best Nexus device would make things better for the end consumer.

mola2alex
mola2alex

Are the figures global or US only? I will always buy nexus. Fast updates, unlocked, no bloat and runs open source android. Even if what your article states is true, that's a lot of developers since they want to test apps before mass adoption of a new version. I think you are just looking at it wrong.

Tech Marketer
Tech Marketer

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Mark Davids
Mark Davids

It was partially the specs to blame (e.g. the camera, no expandable storage), but I think an even bigger problem was that carriers weren't even trying to promote it because they weren't allowed to put their carrier bloatware crap on them.

Choking Kojak
Choking Kojak

I picked up an S2 over a Nexus last December.   Did it to stay with Sprint for data plan reasons rather than change over to Verizon. S2 was/still is great for my needs.  

However, if Sprint offered the Nexus last December I would have bought that instead.  

And yes, franklyI would prefer the "Android experience" and would love to dump the  seemingly irremovable Sprint screen-cheese that clutters my S2's menu.   

Tim Gough
Tim Gough

 It's a nearly unadvertised phone.  It was never meant to be a market leader, but the base phone on which people could base their experience on.  Google markets it mostly as a developer device.  How is any of this surprising? 

Jong-Won Kim
Jong-Won Kim

Surprised by the numbers. The Nexus' camera might be average at best, but it's hard to get a better overall value for that price.

Urbanitus
Urbanitus

The biggest problem with the Galaxy Nexus was its subpar camera, not the stock Android experience.  If Google would put out a Nexus with top-of-the-line specs, I would purchase it in a heartbeat.  

Jake Bonnett
Jake Bonnett

I had Jelly Bean on my Samsung Galaxy Nexus the day it was announced. Not a leak, Google gave us the OTA that day. So I don't know what you're talking about.

Panais
Panais

 The author of this article seems totally unaware about the Nexus concept. In Europe, where I live you never see any kind of ads regarding this phone. The author is trying to make a stupid point against Google. I consider it as a ridiculous article as long as android has conquered as the No1 software used on smartphones. That is the purpose of Google at this point.

Cameron Strickland
Cameron Strickland

Same. I know it gets the 4.1 upgrade sooner but I'd rather have my SIII with the better specs and smoother experience.

Jared Newman
Jared Newman

I guess it's my bad for not making the article interesting enough to read all the way through..

Cheryl C. Marrero
Cheryl C. Marrero

I consider it as a ridiculous article as long as android has conquered as the No1 software used on smartphones...HoursEnjoyMoneys.blogspot.com

Aaron Freyer
Aaron Freyer

 Oh, perhaps I stated that wrong. I meant I thought it was good of Mountain View to offer it unlocked at a good price to fill that niche market. I know most smartphone users are interested in the expensive 2-year contacts and the cheap smartphone upfront.

Jared Newman
Jared Newman

I recall the GNex getting a bigger push from Verizon than any previous Nexus phone (I saw TV ads for it, at least). It was also the first Nexus phone sold at the country's largest wireless carrier, and at a subsidized price. Those things make it more consumer-facing than any Nexus phone to date.

Then again I don't know how aggressively Verizon's store employees tried to sell it. For all I know they were steering people toward the Droid Razr instead.

You make a good point that the _next_ Nexus phone may get an even more aggressive consumer push from Google. But I disagree with you that a relatively low off-contract price will motivate lots of people to buy. Unlocked phones are a niche market, especially if sold outside of a wireless carrier's retail store, where most people tend to go to buy new phones.For mainstream success I think Google will still have to cooperate with a wireless carrier and find a better selling point than stock Android, which as we saw on Verizon was not a huge sales motivator.

Aaron Freyer
Aaron Freyer

Well I read the article all the way through, Jared, and agree with you (not your comment, the story) and Panais' comment.  I only came across the story as I'm looking for a new phone and right now the Galaxy Nexus is the one I'm all for right now given it's the cheapest high-end smartphone I can buy unlocked (via Google Play0 to use with my T-Mobile SIM. At any rate, Panais is right about the concept of the Nexus. I'm not even sure if Google has tried hard to direct it's latest Nexus towards non-developers much. Certainly lately with the introduction of the inexpensive Nexus 7 and the weird orb thing- they now want the Nexus line to be a big deal for everybody. I suspect the next Nexus phone will be the game-changer, or at least it needs to be if Google is trying to expand their market. I would take a S3 or One X over the Galaxy Nexus, but I'm not paying $500+ for an unlocked phone. Google has it right to offer it unlocked at an unbeatable price.