Recent Product Launches Position Google For Strong Future Growth

  • Google recently launched two new Nexus phones, the 5X and the 6P.
  • Google also announced a tablet with a full-size keyboard, the Pixel C, and enhanced Chromecast streaming devices.
  • Google is building hardware to drive the Android ecosystem forward.
  • Google's experimental cell phone service Project Fi is now available on Nexus 6P and Nexus 5X.
  • Project Fi, which intermediates between the consumers and the carriers, is likely to disrupt legacy cellular business models and establish Google as a leading wireless service.

Google -A (NASDAQ:GOOGL) launched two new Nexus phones on Tuesday. The product launch was as per expectations, as covered in an earlier post on amigobulls. The new Nexus phones, 5X and 6P are available for preorder in the Google Store in several countries, with the 5X priced at $379, and the 6P priced at $499.

A full video recording of the launch event is available on YouTube. The video also shows the announcement of the Pixel C tablet, updates to Chromecast, and new features for popular Android apps.

The independent reviews that are starting to appear are mostly positive. "The Nexus 5X is once again set to become the best budget Android phone - especially for Android purists, while the Nexus 6P finally gives the line a premium model to compete with the best from Apple and Samsung," notes Gordon Kelly on Forbes. "As such there should be something for everyone here. Longer term testing will be required to truly give the new Nexuses a definitive thumbs up, but my initial impressions are highly positive."

"Android’s diversity is why it’s become the most popular mobile platform in the world, and the latest version, Marshmallow, takes Android to a new level of performance," states Google's announcement. "While we love all the Android devices out there, every year we build Nexus devices to show off the latest and greatest, directly from the people who built Android. Today we’re introducing the latest Nexus treats, both running Marshmallow, sweetened by amazing apps and sandwiched by some cutting-edge hardware."

"The reason that we build hardware... is so we can guide the ecosystem forward," said Google CEO Sundar Pichai.

The higher-end 6P, built in collaboration with Huawei, has a 5.7-inch screen, and the 5X has a 5.2 inches screen. Both phones have 64-bit processors and increased battery time, with the 6P charging fully in half the time of an iPhone 6 Plus, according to the company. The new phones use machine learning to adapt to a user's specific patterns over time, said Dave Burke, Google's vice president for engineering. Both phones include a new fingerprint sensor, Nexus Imprint, as well as use of Android Pay (in the U.S.).

Google also announced the Pixel C tablet, the first Android tablet built end-to-end by Google. The Pixel C has a full-size keyboard that attaches magnetically to the tablet. Pixel C will be available by the holidays starting at $499, with the keyboard an additional $149, Google said.

Google also introduced two new Chromecast devices with improved performance and new features to stream media to a TV or speaker using a phone, tablet or laptop.

Google's page states that Project Fi, "a program to deliver a fast, easy wireless experience in close partnership with leading carriers, hardware makers and our users," is now available on Nexus 6P and Nexus 5X.

Wired reports that Google started working on Project Fi, its experimental cell phone service, about two and a half years ago. Project Fi allows phones to automatically switch among multiple cellular networks and local area Wi-Fi networks, depending on which network offers the strongest signal at any given moment. Project Fi, operated by Google, lets users switch automatically between two US cellular services: T-Mobile and Sprint. Users pay Google for the service, and Google handles the technical and financial relationships with T-Mobile and Sprint.

Wired notes that Project Fi removes much of the power traditionally held by the big wireless carriers, such as T-Mobile US (NYSE:TMUS), Sprint (NYSE:S), AT&T (NYSE:T), and Verizon (NYSE:VZ). But the carriers have to accept the reality of today's cellular business, which is changing rapidly and moving closer and closer to the flexibility and customer empowerment represented by Google's Project Fi.

"The trend is inevitable," said Richard Doherty, director of wireless technology consulting firm Envisioneering. "The folks at AT&T and Verizon come from a monopoly background. They’ve been used to this since even before Google was born. But that’s not going to work anymore."

It appears that Google is rapidly positioning itself - among so many other things - as a leading maker of cell phones, tablets, and wireless devices, which is likely to have a positive impact on Google's stock in the short term. But Project Fi, if successful, is likely to disrupt legacy cellular business models and establish Google as a leading wireless service that intermediates between the consumers and the carriers, with high potential for Google's growth.

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