Google's Nexus One to Go to Sprint
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Google's Nexus One smartphone will soon be available to subscribers of Sprint Nextel, the second U.S. wireless service provider to announce an agreement to support the touchscreen phone.
Sprint (NYSE: S) said on Wednesday it would announce the pricing and availability date soon for the Nexus One. The smartphone is the first that Google (NASDAQ: GOOG) is selling directly to consumers and is sold exclusively through the Internet company's Web site.
The arrival of the Sprint Nexus One could help broaden the phone's appeal, which has been reported to have experienced lackluster sales in its first several months on the market.
Separately, Google said it continues to claim the right to the Nexus One trademark in the U.S., following reports that the United States Patent and Trademark Office had earlier this month refused Google's application for the rights to the name.
The PTO said there was a likelihood that Google's use of a Nexus One trademark could be confused with the Nexus trademark registered by Integra Telecom Holdings Inc in December 2008.
A Google spokeswoman said in an emailed statement that Google plans to "respond to the office action" from the PTO.
The Sprint Nexus One will represent the first version of the device to work on the CDMA wireless network used by Sprint and Verizon wireless, the largest carrier in the United States.
Currently, the Nexus One is available only as a version that works with the GSM network, for $179 with a two-year contract on Deutsche Telekom's T-Mobile USA, or $529 without a service plan.
Google has previously said that the Nexus One will also be available from Verizon Wireless, a joint venture of Verizon Communications and Vodafone Group, sometime in the Spring.
BGC Financial analyst Colin Gillis said that increasing the number of carriers that support the Nexus One might help sales somewhat, but probably would not be enough to turn the phone into a huge seller like the Apple iPhone.
The real significance of the Sprint deal, Gillis said, is that Google has signed on another carrier to its plan of selling phones directly to the consumer, bypassing the carrier-owned retail stores that have traditionally been the primary mobile phone sales channel.
"It's a step in the process of ultimately having an efficient marketplace for users to go and buy phones and bandwidth, which will put the phones in the hands of more people and which will generate more searches," Gillis said.
The Nexus One is the first of a variety of smartphones that Google has said are in the pipeline as the company seeks to expand its reach from the PC to the mobile world and ensure its online products and ads get prominent placement on a new breed of wireless Internet devices.
Google, the world's No.1 Internet search engine with $23.7 billion in 2009 revenue, said on Monday that it expects the rates that companies pay for search ads on mobile phones to exceed the rates of its existing PC-based ad business in the future.
Google began selling the Nexus One in January, and sales in the first 74 days totaled 135,000 units, compared to the roughly 1 million units that handsets such as Motorola's Droid and Apple's iPhone sold during their initial rollouts, according to a recent report by analytics firm Flurry.
Unlike the iPhone and the Droid, which have been heavily promoted in television ads, Google has only advertised the Nexus One on the Web.
Sprint is the third largest wireless carrier in the U.S. with 48 million subscribers at the end of 2009. T-Mobile is the No.4 carrier in the United States with 33.8 million subscribers at the end of 2009.
Sprint already carries phones that run Google's Android software made by Samsung Electronics and HTC.