Google Inc. has designed a cellphone it plans to sell directly to consumers as soon as next year, according to people familiar with the matter.
The phone is called the Nexus One and is being manufactured for Google by HTC Corp., these people said. It runs Android, the operating system for mobile phones that Google developed, they added. But unlike the more than half-dozen Android phones made by phone manufacturers today, Google designed virtually the entire software experience behind the phone, from the applications that run on it to the look and feel of each screen.
The Internet giant is taking a new, and potentially risky, approach to selling the device. Rather than selling the phone through a wireless carrier—the way the bulk of phones are sold in the U.S. today—Google plans to sell the Nexus One itself online. Users will have to buy cellular service for the device separately. Google began sharing a version of the Nexus One with employees in recent days, according to people familiar with the matter.
In a blog post Saturday, Google wrote it was sharing a new device running its Android operating system with employees to “experiment with new mobile features and capabilities.” The phone is a significant escalation of Google’s assault on the mobile industry, challenging both wireless carriers that sell devices as well as companies that design them.
Google became a high-profile player in mobile two years ago, when it launched Android. Google designed the software to seed its mobile applications, such as Gmail and Google Maps, and increase usage of the Internet from phones to grow its online advertising business. A number of leading handset manufacturers, including HTC and Motorola Inc., built phones running the software, some of which contain branding “powered by Google.”
But the phones—many of which just hit the market in recent months—haven’t sold nearly as well as Apple Inc.’s iPhone, which is capturing more interest from software developers. Now, Google appears to want to throw its brand behind a device more directly, designing a phone without working with the wireless carriers that often dictate what features they allow on their networks.
The move could alienate wireless carriers and handset makers that offer Android phones and don’t want to compete with Google. Google has repeatedly said its goal is to have hundreds of Android phones rather than one.
The move also marks a rare foray into direct sales for Google. With the exception of an appliance it markets as a search tool to businesses, the company hasn’t sold hardware in the past.
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