4 ms·
It looks great, but as I've mentioned here before, I have some concerns about the cost. It's a great short term boon to consumers getting a device of this high
by nicholassmith 13y ago
It looks great, but as I've mentioned here before, I have some concerns about the cost. It's a great short term boon to consumers getting a device of this high quality at this price point, but the margins have to be razor thing on it, so how do they make money for R&D? What about Company X? What do they do, slice prices to match to keep market share or hope they retain a profit share? If they slash where do they get the R&D budget from?
The smartphone market is starting to get truly interesting, I just hope it doesn't get dominated by the companies with the deepest pockets, it's a short term gain for consumers (we all like things cheaper), but could long term stagnate the market.
- Brakenshire 13y agoYou can see this with Jolla- interesting new entrant, aims to provide a less monolithic, more hackable device, built on the Nokia N9, which was widely acclaimed. But it's double the price of the Moto G, with equivalent or even slightly worse specs. If Google is selling its handsets at or near cost, and relying on the long-term value of advertising and data, then it will be almost impossible for anyone without the same revenue streams to engage in serious competition.
- dageshi 13y agoI guess if you're google, you might worry that someone could come along and do this to you. Someone say for instance Amazon decides to sell a very good quality phone at near cost and starts to capture marketshare. From Google's perspective, better for them to preemptively do that if that's where the market is heading anyway.
- pekk 13y agoAssuming the only spec that matters is a CPU frequency etc., which is as incredibly silly and naive today as it always was
- TrainedMonkey 13y agoGoogle is not in business of making money with selling hardware like Apple and Samsung. Google is selling a platform, and then makes money from people using it.
- a3n 13y agoAnd then makes money from people using the people that use the platform.
- notdrunkatall 13y agoYou worry too much. Google can afford to blow some cash on a long-term strategy. They'll be fine. Company X will either sink or swim. If they sink, Company Y will take their place once Google's long-term plan reaches maturity and the value of their phones begins stagnating. It's a cliche that so many people hate to hear, but the market will sort it out. Consumer electronics is one of the least regulated sectors worldwide, yet it has been advancing by leaps and bounds for some three decades, and the diversity of companies large and small in the consumer electronics space has never been greater than it is today.
- tjbiddle 13y agoExactly. Google can afford a long-term strategy - but, as much as I support Google, competition is healthy for any market.
- InclinedPlane 13y agoThin margins are great. Innovation typically happens more when margins are thinner. When profit is easy it's easy to be lasy, which we've seen. It'll be nice to see the market tighten up more and people actually have to earn money by servicing the customer.