Google’s Nexus One to disrupt Canadian wireless market, analysts say

The Google Nexus One smart phone—designed by the HTC Corp.—has the potential to be a game changer in the Canadian marketplace, but not for reasons that have to do with its hardware, say analysts. Peter Misek of Canaccord Adams in Toronto wrote in a recent newsletter that he believes the Nexus One and Android, the open-source operating system that runs the Google phone, have the potential to disrupt the contract-based business model that dominates the North American wireless market. “For carriers, Google seems to be trying to circumvent their ownership of networks, spectrum, and the very customers they bill each month,” Misek wrote in a Canaccord newsletter. “It has been known to the industry that smart phone partners working with Google never really trusted the company to begin with, and thus, had enough time to prepare for something along the lines of Nexus One.” Nizar Assanie, principal analyst at Vancouver’s IE Market Research, said in an interview that he believes Google will follow the same model that Apple Inc. used with the iPhone. He said he expects Google to build a relationship with one carrier—in the United States it has been T-Mobile—and build its brand from there. “Branding does matter,” Assanie said. He emphasized that phone’s operator support also matters. “I have a Blackberry and when I have a problem, the first thing I do is I call *611 which is the Rogers help line,” he said. If Google chose to use multiple carriers, it would need to find a way to provide centralized customer support, Assanie added. Chris Robbins, chief customer officer of Wind Mobile, said in an interview that it makes sense for carriers to move away from the contract model. “ subsidies are kind of like the heroin of the mobile industry. Any time you want to drive sales you throw in these supposedly free phones and lock them into a three year contract,” he said. “I actually think the model is game changing—the idea of having them actually sell it off their website. It’s unlocked and can be used on any network.” Wind, a new player in the Canadian wireless sector, hopes to strike a deal with Google to be the first company to bring the Nexus One to Canada. Wind is the only Canadian carrier that uses the AWS spectrum band that the Nexus One uses with T-Mobile in the U.S. Wind does not use contracts for any of its phones. Instead it follows the European and Asian model, in which the carriers provide access to the network but customers are not tied to particular phones or contracts. Wind has not yet received an indication from Google about any potential partnership to carry the phone in Canada. Google spokeswoman Wendy Rozeluk would not say when the phone will be available in Canada, but wrote by email that Google intends to “gradually roll out the Nexus One to different countries in order to gain user feedback internationally and ensure the ordering process works smoothly.”

Google’s Nexus One to disrupt Canadian wireless market, analysts say

News | 01/16/2010 1:20 am EST

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