Narrative: Google's Hardware Push
Each narrative page (like this) has a page describing and evaluating the narrative, followed by all the posts on the site tagged with that narrative. Scroll down beyond the introduction to see the posts.
Google Pixel Launcher User Numbers Cross 1m Mark, Suggesting 1m Pixel Sales (Jun 13, 2017)
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eMarketer Estimates 71% Market Share for Amazon Echo, 24% for Google Home in 2017 (May 8, 2017)
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Google Forced to Unbundle Services from Android and Open to Search Competitors in Russia (Apr 17, 2017)
The EU is currently taking action against Google over what it sees as anticompetitive practices including bundling of its own services and blocking competing ones from being pre-installed in Android. As such, this Russian case takes on more importance than it might otherwise have, because it presents one possible outcome of the EU case, which is forcing Google to unbundle its own services from Android and allow competing search engines like Yandex to be pre-installed. That’s certainly a possibility in the EU case too, and would mirror the action taken years ago against Microsoft over browsers in Windows. If that were to happen, I’m skeptical many people (or OEMs) would choose alternative search engines on an Android phone, but it would potentially threaten Google’s Android business model, which is entirely about the apps and services it runs on the device (and the advertising they enable). For what it’s worth, as I wrote in this piece at the time the EU action was announced, I still think it’s misguided.
via Bloomberg
LG Confirms Interest in its Display Business, Doesn’t Mention Google – Android Authority (Apr 12, 2017)
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Google calls time on the Pixel laptop – TechCrunch (Feb 28, 2017)
This is a minor news item, but a slightly surprising one – the first product to bear the Pixel brand at Google was a laptop, but the company won’t be making any more of those in the foreseeable future, apparently. With the big hardware push underway at Google, I had been anticipating that we might well see updates to both the laptop and the tablet that also bear the Pixel name alongside a revision of the Pixel phone this fall, but it seems Google’s hardware vision isn’t quite as expansive as I thought. It would be great to hear from Google at some point some sort of specific vision of why it’s in the hardware business, and why it wants to be in some categories and not in others (even some it’s done in the past).
via TechCrunch
There are too many ways to Google on Android – The Verge (Jan 30, 2017)
I’ve tagged this post against three different narratives, because this little mini-review taps into several broad threads. Firstly, this is about Google and parent Alphabet’s tendency to allow lots of people to work on the same thing in different parts of the company in different ways, which results in a confusing user experience because there are many ways to do the same thing (see especially messaging). Secondly, there’s the fact that on Android Google’s own messy set of services is often duplicated (or worse) with competing services and apps from OEMs and/or carriers. And lastly there’s the fact that even on Google’s own hardware, the Pixel, which is supposed to represent the epitome of Android at its best, this confusion still reigns. I was half-tempted to tag this post against the Google is Ahead in AI narrative too, because though Google does fantastically well at the back-end AI piece, it often falls short on the user interfaces and experiences that present the functionality to the user. The point is, the situation described in this article is far from ideal, but it grows out of several cultural quirks at Google/Alphabet combined with several of the downsides of the approach Google has always taken with Android, and a solution doesn’t seem imminent.
via The Verge
Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results – Alphabet (Jan 26, 2017)
One of the things I was most interested in as part of Alphabet’s results was what happened to the Google Other category of revenues, because that’s where sales of the new hardware devices will be reported. That category grew 62% year on year, but also includes Play store revenues as well as Google’s enterprise cloud service revenues, and has been growing at a decent clip already. I’d estimate around $600-700m in revenue from the new hardware products, which probably translates into 600-700k Pixel sales and sales of Home, WiFi, and Daydream hardware. That’s not a bad start, but of course supply was constrained and distribution limited, so there’s clearly potential for more here. Back in the core business, it’s striking how the number of paid “clicks” on Google’s own properties remains the one big driver of ad revenue growth, while total paid clicks on third party sites and the cost per click on all sites continues to fall. YouTube is the major driver here (those clicks include views of video ads where no-one actually clicks), offsetting the erosion of revenues from the shift from desktop to mobile, and was an obsession among analysts on the call. Sundar Pichai focused his remarks on machine learning rather than AI, although the two topics are closely related – it was interesting to hear Satya Nadella kick off the Microsoft earnings call an hour later with talk of AI.
You might also be interested in the Alphabet Q4 2016 deck which is part of the Jackdaw Research Quarterly Decks Service.
via Alphabet (more on Techmeme)
Source: Google’s Pixel 2 to feature improved camera, CPU, higher price, but ‘budget’ Pixel also in works | 9to5Google (Jan 26, 2017)
Lots of interesting stuff in here, but of course none of it certain to pan out in the actual product. To my mind one of the most interesting aspects is that the price of the Pixel 2 is expected to be $50 higher than the first-generation Pixel, which was already priced at premium levels – that part doesn’t ring quite true to me, unless it’s an Apple-like creation of an additional tier above the standard ones. Pricing its only phone higher than the base iPhone model would unnecessarily limit the market, and that seems unlikely. The camera focus makes sense – the first version majored on the camera and the Assistant differentiator should have been eroded relative to other Android devices by then, so hardware features will be important. The budget version is also interesting in the context of the recent reports about Google bringing Android One to the US – it certainly wouldn’t be unprecedented for two parts of Google to be working on essentially the same problem in different ways, but the hardware strategy there has been more joined up lately. The other thing to note is the details about chips, as Google is apparently testing both Samsung and Intel components as well as something it’s built itself. There have been repeated rumors about Google building ARM-based servers, and it’s possible that it’s also experimenting with its own ARM-based chips for smartphones too, though this would be a massive multi-year effort, especially tough without an acquisition of significant existing skills a la Apple/PA Semi.
via 9to5Google
Google’s Big Marketing Push Pays Off for its Pixel Phone Over Holiday – Bloomberg (Jan 19, 2017)
This piece is an interesting counterpart to a couple of others I’ve recently linked to – another quoting Wave7 estimates for Pixel sales, and this WSJ analysis from earlier today on how hard Alphabet has been pushing sales of its hardware on Google search, given what this piece says about heavy TV advertising by both Google and Verizon around the Pixel. It’s also worth reading this Verge piece, which takes a much harsher stance on what these sales numbers and the supply shortages mean, though it focuses almost exclusively on the 128GB model. The point is, Pixels are in short supply, and there’s an estimate in this Bloomberg piece of around half a million sales, so this is a very different supply shortage from Apple struggling to meet demand for over 70 million phones per quarter – in other words, this isn’t about hitting up against theoretical maximum capacity for building phones, but about very conservative planning on Google’s part. Half a million isn’t bad, but it’s fairly clear sales could have been a lot higher with better supply. Presumably Google will learn from this experience as it looks to update the Pixel, possibly later this year.
via Google’s Big Marketing Push Pays Off for its Pixel Phone Over Holiday – Bloomberg
Google Uses Its Search Engine to Hawk Its Products – WSJ (Jan 19, 2017)
This is a really fantastic bit of a analysis commissioned by the Wall Street Journal. It found that for 91% of searches relating to top consumer electronics categories, a Google or Nest product was in the top ad slot above the results, and in 43% it had the top two slots. This is Google competing with its own advertisers, and Google apparently was so taken aback by the analysis that it tweaked its strategy when the WSJ spoke to Google about it, and the numbers are now much lower. Google’s hardware push therefore not only puts it in conflict with its OEMs, but also with its biggest customers – advertisers. I’m intrigued to know how other big consumer electronics brands feel about this, but the challenge of course is that they have few alternatives – Google dominates search, and so it also has a dominant position in pitching its own products. There’s a close analogy here to Amazon’s hawking of its hardware on Amazon.com, but competitors know what they’re getting into there to a greater extent.
via Google Uses Its Search Engine to Hawk Its Products – WSJ