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Unpicking the Pixel puzzle: Why Google is struggling to impress

Despite respectable sales, it's an uphill battle

Is seven million in nine months good or bad?

Is Google serious about selling phones? The level of investment suggests so. Perhaps you can argue Google is doing the best a consumer data cruncher can. But that's largely the problem. As I discovered recently, configuring a Pixel 2 with a "burner account" – a fresh Google ID – the experience is entirely geared around data acquisition. That seems to be the Pixel's raison d'être. From the moment you first boot it, Pixel is demanding to help you by recording corners of your life that had previously gone unrecorded. All to help you, dear user.

With Google refusing to disclose sales, I turned to Francisco Jeronimo, who counts phone shipments for IDC.

"The Pixel 2 and Pixel 2 XL shipped 3.4 million units between Q4 2017 and the end of Q2 2018," he told us. Jeronimo said shipments of the first generation Pixels, which continued to be on sale, reached the similar volume: 3.44 million first generation Pixels and 3.47 million second generation Pixel 2s shifted. So in all, that's around seven million shipments in three quarters. By comparison, in a full 2017, IDC reckoned Google shifted some 3.9 million Pixels.

It isn't too bad, from a glass-half-full perspective – that's far from a failure. As Francisco pointed out earlier this year, it's an achievement to persuade a mature market, in which everyone has a decent phone, to shift to a new brand. Especially ones that come with an eye-gouging price. For perspective, Samsung is expected to shift 31 million Galaxy S9s this year – its lowest flagship volume for six years.

But the market is shifting to high-quality midrange. As Jean Baptiste Su of Atherton Research argued earlier this year, the Pixels are still too expensive for what they deliver.

"The hardware business is just not worth as much as Samsung's or Apple's that it can command the same price premium. Having said that, despite how good Google phones would be, they need to cost about $150 to $200 less than the newly released S9 ($720) and S9+ ($840) – and that's before Samsung's discount of up to $350 for a qualifying trade-in!," he wrote in March.

Google needs to listen to Pixel owners. They seem to be living in a permanent beta test. Serious bugs – such as the one that requires you to reboot the phone after a call – shouldn't take six months to fix. The support and service and sales incentive infrastructure needs to be built. This is textbook stuff – Huawei has managed it. Soon Xiaomi will enter mature markets with modern-looking phones at even lower prices.

Google has bought its success at huge expense, but it's not going to be easy maintain. Success means establishing a warm, assuring brand in the public's mind. That's hard for anyone... let alone a consumer data processing company. ®

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