Google shutters Nexus One direct sales channel

Google announced it will stop selling the Nexus One via its website, and will shutter the direct-to-consumer effort the phone championed. The news comes shortly after both Verizon Wireless (NASDAQ:VZ) and Sprint Nextel (NYSE:S) announced they will not sell Google's Nexus One smartphone.

Google will no longer sell the Nexus One via its website.In a post on the company's site, Google's Andy Rubin wrote that the company is "very happy with the adoption of Android in general, and the innovation delivered through Nexus One."

"But, as with every innovation, some parts worked better than others," wrote Rubin, Google's vice president of engineering. "While the global adoption of the Android platform has exceeded our expectations, the Web store has not. It's remained a niche channel for early adopters, but it's clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to chose from."

Thus, Google will work to make the Nexus One available globally directly through carriers, as it has done with Vodafone in Europe. Rubin wrote that Google will "stop selling handsets via the Web store, and will instead use it as an online store window to showcase a variety of Android phones available globally."

Explained Rubin: "Innovation requires constant iteration. We believe that the changes we're announcing today will help get more phones to more people quicker, which is good for the entire Android ecosystem: users, partners and also Google."

Google unveiled in January its direct-to-consumer effort, centered on the HTC-built, Google-branded Nexus One. The action raised hullabaloo in the industry, as pundits wondered whether Google's efforts would alienate its Android licensees, who would have to compete against Google-branded hardware. Industry watchers also saw the push as an attempt by Google to wrest some control over the distribution of phones away from carriers.

In announcing the Nexus One, Google said in January that "the goal of Google's new consumer channel is to provide an efficient way to connect Google's online users with selected Android phones. The online experience of the web store has been designed with a focus on simplicity."

Though Google executives have recently described the company's Nexus One effort as profitable, it appears the company is bending to criticism over its smartphone strategy. Indeed, industry analyst Jeff Kagan appeared to offer a prescient outlook on Google's Nexus One strategy in January by noting: "The Google brand is getting confusing though. First there was the Google Android. Then the next version of the Google Android along with Verizon's version called Droid. Now we have another brand called Google Nexus One. If managed poorly this could get very confusing in the marketplace."

Despite Google's Nexus One rejiggering, the company's Android operating system continues to gather momentum. According to a report released this week from NPD Group, Google's Android mobile operating system now represents 28 percent of smartphone unit sales in the U.S.--behind only Research In Motion's (NASDAQ:RIMM) BlackBerry (36 percent) and moving past Apple's (NASDAQ:AAPL) iPhone (21 percent).

For more:
- see this Google post
- see this Engadget post

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