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Comment by FraaJad | Hacker News Reader

Google, don't lose heart. It's not you. It's just that people in US don't know that they can buy phones in open market without signing away a chunk of income to cell companies every month.

There are bigger, more mature markets elsewhere. Go after them. You might even get more people to use your services (maps, etc.) on a mobile than they would on a PC.

Also, $350-$400 (may be even $500 for topend) is a sweet spot for smart phones in India. And people do buy these phones in open market without a contract.

All the best. Go forth and prosper.

/an iPhone and Droid owner.

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I think it's more a question of providing their usual level of mediocre, black-hole customer support, where there's no way to talk to someone about problems or issues. They fixed this about a month after launch (set up a phone line), I still have the sense that properly supporting end-users isn't in Google's DNA.

Google's support sucks, but it's not like, say, Verizon is known for prompt and friendly service. Waiting so long to set up a phone line didn't do them any favors, but it was all about post-sale support anyway. I really don't think that had a big impact on sales.

Google, don't lose heart. It's not you. It's just that people in US don't know that they can buy phones in open market without signing away a chunk of income to cell companies every month.

As far as I know, only T-Mobile USA has really come on board so far to make non-subsidized phones a better deal. T-Mobile has cheaper rates if you are not on contract. If you buy the AT&T compatible Nexus One, for example, you still pay the phone "subsidy" the entire time are using AT&T, even though you own the phone outright.

If you're a loyal T-Mobile customer you get to pay a loyalty tax if you want a Nexus One compared to if you are not a T-Mobile customer.

What do you mean exactly?

Honestly, it's just the way things work. It's not specific to this phone or provider. You get a subsidized phone when you sign up a _new_ plan. It's part of the cost of the service you're agreeing to. If you're already a customer, in the middle of a contract, they don't "reward" you by subsidizing a phone any time you ask for it (i.e. when a new one comes out).

When the N1 came out, however, people were for some reason surprised about this. There's lots of news about it: http://www.google.com/search?q=t-mobile+%22nexus+one%22+%22n...

What's the difference between me re-upping my contract for 2 years and someone else starting a new 2 year contract?

Google seems to think the former case deserves to pay $100 more for the phone.

T-Mobile pays out more in commission for the latter than the former.

If you're not outside your current contract, that's not really a very good option. If your plan has expired, aka, you're past your initial 2 years, that's fine.

Otherwise, you have people entering (comical) 20 year contracts, which would be (practically) unenforceable.

Huh? You've already received a subsidized phone if you are an existing customer so I don't see the point. If I don't want a subsidized phone, why should I pay the same rate as someone that does?

Can we expect LTE phones to work across carriers? If so, I anticipate a demand for change in the US when someone brings their out-of-contract ATT phone over to Verizon and realize they are paying as much as someone that got a subsidy.

In Germany at least there are lot's of options. I am currently on a contract with no recurring fees that can be canceled at any time. Prices for telephony and data connections are cheaper than most other contracts, too (so they don't make up for the lack of recurring fees with higher rates).

Google botched it from the start by offering what was effectively a carrier locked phone. Few people want to pay $500 for a phone that is only fully functional on one carrier. If Google had at least offered one GSM model compatible with both AT&T and T-Mobile 3G they could have offered some choice. Alternatively maybe they could have offered a trade-in/swap program so GSM N1 owners could switch to a CDMA N1 inexpensively. Better yet Google could have subsidized the price of the handset enough to entice people. They basically just adopted the same business model of expensive "unlocked" carrier locked phones that have failed many times in the US before. Not sure if they really expected a different result here or just wanted to jump start the Android market. If it's the later I'd say they got some successful results.

"Also, $350-$400 (may be even $500 for topend) is a sweet spot for smart phones in India. "

Given that the average Indian worker makes less than $6k a year, I'm not sure I'd really describe those figures as a "sweet spot".

You can't go by averages. Average wages are low in India. But India also has more billionaires than UK or Germany.

The market for smart phones is pretty big in India.

(Don't have the sales numbers at hand. But Admob metrics report shows that in the first 3 months of 2010, they served 2.8 billion requests to cellphones in India. 63.1% of them were from smart phones. This doesn't mean that 2 out of 3 cell phones in India are smart phones as folks without smart phones don't usually go online much. But it does mean that the Indian market for smart phones is bigger than the Australian market - where Admob served 656 million requests in the first quarter of 2010.)

As ankeshk pointed out, average salaries may be low, but there is no dearth of well to do people in India. Also, young people spend a lot of money on mobile phones. A fancy and suitably expensive phone and a motorbike are what is a car to an american teenager.

India has unequal distribution of wealth compared to western countries. Thinking of India as a poor country is common mistake.

This. I'm surprised that Android phones are not being pushed more aggresively in India. There's a pretty big demographic there that is willing to throw money at good smart phones and Apple is screwing the pooch with their comically high pricing. If companies can sell unlocked androids at decent prices they could capture a piece of a very significant mobile market that is currently owned by Nokia and Sony

an iPhone and Droid owner

If you don't mind me asking, how/why do you use two phones?

iPhone is my main phone. I'm using the droid to learn more about the android platform and do development on it.

The problem is there were no samples in stores that people could play with.

And, if you got a lemon, you couldn't take it back and exchange it for a new model (you had to wait weeks while it was repaired by HTC (assuming N1 here)).

I really don't understand why people keep missing these two crucial points, which TRUMP ALL OTHERS.

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