USA TODAY US Edition

CAN GOOGLE LURE APPLE BUYERS?

This could be Google’s big chance to nab Apple customers who don’t want to pay $1,000 or wait months for a new phone

- Ed Baig ebaig@usatoday.com USA TODAY

The next Pixel phones are coming, and Google wants you to know they’re hoping to leave competitor­s — namely two glossy, recently launched rivals from Samsung and Apple — in the dust.

Weeks ahead of Wednesday’s expected launch, Google teased the devices in YouTube and TV promo videos that asked, “What’s wrong with my phone’s battery? Why does my phone take so many blurry photos? Why doesn’t my phone understand me? Why is my smartphone so dumb?”

Last year, Alphabet-owned Google made a big push into hardware, launching its first ‘Made by Google’ phones with overtures to Apple iPhone users who might be lured by its new, artificial-intelligen­ce-powered Google Assistant and satisfied by a design that was similar to other premium phones.

The Pixel and Pixel XL — the first phones for which Google took over all aspects of the hardware and software design (though HTC was the manufactur­er of the units) generally earned good marks off excellent cameras and the Assistant’s better-than- Siri smarts. They had the added advantage of offering Android users an alternativ­e to the beloved, but ultimately recalled, Samsung Galaxy Note 7.

But positive reviews didn’t result in big sales, raising the stakes for Pixel 2 and Pixel 2 XL (or whatever they will be called). These probable successor models again face off vs. the top-line phones from Samsung, which recently released its Galaxy Note 8 phablet to complement its popular Galaxy S8 phones, and Apple’s premium iPhone X.

There’s also a slew of other Android rivals selling premium, as well as lower-priced, phones, many out of Asia.

“Pixel has been a flop,” says Neil Mawston, executive director

Positive reviews for the Pixel didn’t result in big sales, raising the stakes for Pixel 2 and Pixel 2 XL (or whatever they will be called).

for wireless device strategies with the Strategy Analytics market intelligen­ce and consulting firm. He says Pixel captured a puny 0.1% share of all worldwide smartphone­s in the second quarter of 2017. For comparison purposes, the best-selling iPhone 7 (single model, not the whole iPhone portfolio) captured a 5% share.

Last year’s Pixels were partly hamstrung by distributi­on delays and product shortages and the fact that the phones lacked certain features found on other devices, including water resistance. The design, which had big bezels along the top and bottom of the display, was considered ho-hum.

IN SEARCH OF DEFECTORS

Still, there could be an opportunit­y for Google among disillusio­ned Apple customers for whom spending more than $1,000 for the iPhone X just isn’t palatable. Besides, the X isn’t slated to arrive until Nov. 3, and even then, supplies are expected to be extremely tight. If you’re a Google optimist, maybe some of those prospectiv­e buyers look to Pixel, though they might just as likely stick with Apple and go for an iPhone 8 or 8 Plus.

The new Pixels aren’t expected to crack four digits, but they won’t be inexpensiv­e, either. The betting is the Pixel 2 will start around $649 and the Pixel 2 XL around $849, in the ballpark of where the iPhone 8 and 8 Plus models are priced. The phones will almost certainly run the fresh Oreo version of Android. VentureBea­t’s Evan Blass maintains that Pixel 2 will have a 5-inch display while Pixel 2 XL could have a comparativ­ely massive 6-inch screen.

Beyond the specs, though, will the phones incorporat­e any major surprises or features to help differenti­ate Pixel from the competitio­n? Has Google signed up more carriers? Last year, Verizon was the exclusive seller, but the phone could be used (unlocked) on any of the major carriers.

If there are surprises, they will likely emerge from the software side of Google and its prowess in artificial intelligen­ce, the secret sauce that Google has used to advertise its hardware over rivals in phones and voice-activated assistants. The aim, according to Google execs, is to make sure the informatio­n and search giant is intertwine­d with the devices consumers use in nearly every waking moment — from laptops to smartphone­s to voice speakers.

Besides the Pixel, so-called “Made by Google” products include Google Home speakers, Google Wi-Fi routers, Daydream View (virtual reality) and Chromecast Ultra streaming devices.

Google has two main goals for Pixel, Strategy Analytics analyst Mawston says. It should increase eyeballs for Google’s profitable search engine and advertisem­ents. Second, Pixel is designed to be a showcase example of hardware-software integratio­n for “purer” Android. Manufactur­ers of Android phones sometimes add their own proprietar­y custom interfaces, which leads, critics say, to a lack of consistenc­y.

THE HTC CONNECTION

Google recently bolstered its hardware abilities by acquiring certain HTC “assets” — essentiall­y some HTC employees transferre­d to Google to bolster its hardware efforts. HTC is expected to manufactur­er the Pixel 2, but reports have LG making the larger XL device.

The HTC deal “illustrate­s Google’s commitment to the consumer device space,” Forrester analyst Thomas Husson says.

Google senior vice president for hardware Rick Osterloh, writing about the HTC deal, said Google is focused on “creating a portfolio of products” that combine the best of Google software with “thoughtful­ly designed” hardware.

Still, there are questions about how big a business Google can build on branded hardware and how long it will take to achieve any kind of measurable success.

It’s in good company in trying. Software and Internet giants, from Microsoft to Amazon, have found that they want their own hardware to keep contact with the end user. “Premium hardware can be a good way to monetize a software and services platform,” said Avi Greengart, research director, for consumer platforms & devices at Global Data. “Apple pioneered this business model 40 years ago, and Microsoft got fully on board with Surface,” he says.

 ?? SARA SNYDER, USA TODAY ?? Last year’s Pixel smartphone didn’t sell well.
SARA SNYDER, USA TODAY Last year’s Pixel smartphone didn’t sell well.
 ?? MARCIO JOSE SANCHEZ, AP ?? If there are surprises with the new Pixel smartphone­s, they will likely emerge from the software side of Google and its prowess in artificial intelligen­ce.
MARCIO JOSE SANCHEZ, AP If there are surprises with the new Pixel smartphone­s, they will likely emerge from the software side of Google and its prowess in artificial intelligen­ce.
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