With its latest consumer goods, Google prices are falling Apple, Samsung and Amazon. The search giant has unveiled its latest smartphones, tablets and smart devices for the home, all available at prices well below those of their direct competitors. Where Apple and Samsung are pushing prices for its latest products even higher, Google seems happy to keep prices low, which creates an undeniable advantage for its products.
Google, like Amazon and almost Apple, is a service company that sells hardware. It must acquire users across multiple sectors, including hardware. Somewhere at the bottom of the Googleplex, a team of number calculators decided that it made more sense to significantly reduce the price of its hardware compared to its competitors. If Google suffers a loss on the hardware, it will probably do it back through services.
Amazon does it with Kindle devices. Microsoft and Sony do it with game consoles. It is a proven strategy to increase market share when the product generated by the system recovers the lost product by selling hardware with thin or negative margins.
Look at the pixel 3 . The basic model of 64 GB is available at $ 799, while that of the iPhone XS 64 GB is $ 999. Want a bigger screen? The Pixel 64 XL 64 GB costs 899 USD, and the iPhone XS Max 64 GB to 1099 USD. As for specifications, both phones offer OLED screens and amazing cameras. There are probably advantages and disadvantages regarding the SoC speed, the amount of RAM and the wireless capabilities. Will consumers worry about it since the screen and the camera are so similar? Probably not.
Google also announced the Home Hub today. Like the Echo show, it is designed to be the central part of a smart home. He places Google Assistant on a fixed screen where users can ask him questions and control a smart home. It's $ 149. That's $ 80 less than Echo Show, the Google version lacks video conferencing and a dedicated hub for the smart home – the Google Home Hub requires additional hardware for some smart home objects. Nevertheless, even with fewer features, the Home Hub is attractive because of its considerably lower price. For a few dollars more than an Echo Show, a buyer could buy a Home Hub and two Home Mini.
The Google Pixel Slate is Google's answer to the iPad Pro. From all we've seen, it seems to miss a lot of the processing power of Apple's best tablet. It does not seem as refined or capable of specific tasks. But to visualize the media, to create content and to play games, that seems very good. It even has a Pixelbook pen and an excellent keyboard that indicates that Google positions it in relation to the iPad Pro. And the 12.3-inch Pixel Slate is available priced at $ 599, while the iPad Pro 12.9-inch costs $ 799.
The initial price is only part of the equation. When considering the resale value of these devices, a different conclusion can be reached. Apple products systematically sell more money than Google products. On Gazelle.com, a company that buys used smartphones, a used iPhone X is worth $ 425, while a used Pixel 2 is worth $ 195. A used iPhone 8, a phone sold at a price closer to the Pixel 2, is worth $ 240.
In the end, Google probably does not expect to make money with the hardware sold. He needs users to buy his services. The best way to do this is to make the ecosystem competitive without investing the capital to get the most out of it. That must be enough, and that's how I would describe these devices. Good enough to be competitive on a specification basis while being available for much less.