Google unveils $179 Nexus One cell phone

MOUNTAIN VIEW, Calif. - Google Tuesday unveiled its long-anticipated new smartphone, Nexus One, which costs $179 with a two-year service contract.

The phone, available now, reinforces Google's position as a major player in the smartphone market - and issues a challenge to its rivals and partners alike.

The Nexus One runs an updated version of Google's Android operating system. It has a 3.7 inch touchscreen display, with a 1 gigahertz processor from Qualcomm. It includes a 5 megapixel camera for video and photos, a global positioning system (GPS), and stereo Bluetooth connection for headphones.

The battery will last for up to seven hours of talk time, or up to five hours of Internet use, on a 3G cellphone network, Google says.

The phone, available online at google.com/phone, costs $179 with a two-year contract from T-Mobile. Similar offers will be available from Verizon Wireless and Vodafone (a British cellphone company) in 2010, Google says.

Consumers can also buy an unlocked phone, without a contract, for$529. Since the current model uses GSM cellphone technology, it work with AT&T's network as well as T-Mobile's. The future model, being designed for Verizon, will feature CDMA technology, used by Sprint, MetroPCS, Cricket and other carriers.

Rival Apple's iPhone costs from $99 to $299.

The Nexus One price didn't impress longtime Google watcher Danny Sullivan, editor of SearchEngineLand, who asked Google executives why they introduced a phone with similar pricing to what's already out there. Sullivan mentioned reports that Google would one day introduce a free, ad-supported phone. "Where is that?" he asked. "I want the revolution from Google."

Andy Rubin, who runs Google's Android division, replied, "Before you can revolutionize the world, you have to have a mechanism in which you're selling products. Let's put the best class of products in the store."

Other manufacturers, including Verizon and Motorola, have already released Android phones, but the Nexus One is the first to be rolled out by Google. Manufacturer HTC, a Taiwanese company best known for the Touch smartphone, is actually building the device.

The message to consumers from today's announcement is that Nexus One is the flagship Google phone, and the others aren't as good, says Michael Gartenberg, an analyst with Interpret.

"If I was a (Motorola) Droid customer who just bought the phone a month ago, I might not feel so good about the purchase," he says. Google "made it clear that not all Android phones are created equal."

Google's Rubin says that by having its own store, Google could potentially lower the costs of wireless plans, "because(the company) won't have the built-in costs" of heavy advertising.

The Nexus One includes a feature new to Android: active noise cancellation technology that will push out background noise when in a busy area.

Another highlight is a feature that lets you dictate e-mails, Tweets and Facebook posts without having to type.
It's an extension of Google's voice search, already available on other Android phones.

On the iPhone, similar functionality is available via a Dragon Dictation app, from the company that makes speech recognition software for PCs.

Other apps on Nexus One include YouTube, Gmail, and Maps.

Gartner analyst Ken Dulaney says it's significant that Google is selling the phone directly via an online store. "If I was Amazon, Best Buy or Radio Shack, I'd be worried," he says. "Google is now in the retail phone business and if it turns out to be big, this is going to affect them. Its like what Dell did to the PC business."

Google could also undermine carriers by offering the unlocked model. Unlocked phones aren't very popular in the U.S., where consumers like subsidies, says Gartenberg says. But Rubin says that overseas, as many as 50% of phones are sold unlocked.

The Nexus One launched Tuesday in four markets: The United States, the United Kingdom, Singapore and Hong Kong.

Sulamérica Trânsito

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