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Google Inc.: The Nexus program

Published: January 2013 · Publisher: MarketLine
Incorporated in 1998, Google Inc. (Google) has become the world’s largest Internet search engine, and now offers various other affiliated services. Google has recently started to offer Nexus branded products to supplement its main operations ...
Report Type Case Studies
Language English
Format Electronic (PDF)
Pages27
Frequency Updated Annually
Availability Will be emailed within 1 business day
Reference No. 0109-2781
Price € 369,00
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Introduction

Incorporated in 1998, Google Inc. (Google) has become the world’s largest Internet search engine, and now offers various other affiliated services. Google has recently started to offer Nexus branded products to supplement its main operations. This case study assesses why and how Google has entered the hardware market with Nexus, its success thus far and the impact on its business going forward.

Features and benefits

* The publisher's Case Studies describe topics such as innovative products, business models, and significant company acquisitions.
* Fact-based and presented in an accessible style, they explain the rationale of commercial decisions and illustrate wider market and economic trends.

Highlights

• Since its inception, Google’s revenue mix has been highly concentrated, with the vast majority of its revenues being derived from online advertising operations. Following the economic downturn, weaknesses have begun to emerge within this revenue stream, and the company is therefore looking to diversify operations.
Through its Nexus program, Google has entered the smartphone and tablet markets, and has employed a partnership strategy with other manufacturers with its Nexus devices. Additionally, the company has aimed to disrupt the mobile devices industry through pricing and distribution strategy.
Sales of Nexus devices have not been a significant revenue or profit driver for Google due to competitive pricing strategies, dual branding and distribution failures. However, Nexus devices have had an impact upon the tablet market, and have forced market leader Apple to pursue the small tablet market in spite of previous reservations.

Your key questions answered

* Why has Google entered the smartphone and tablet markets with its Nexus devices?
* What strategies has Google employed in bringing its Nexus devices to the market, and how successful has it been in doing so?
* What has been the impact of the Nexus program on Google's business thus far, and what effect will it have going forward?
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O VERVIEW
Catalyst
Summary
WHY ENTER THE HARDWARE MARKET?
Google has an overreliance on online advertising revenue
Google’s revenue stream suffers from a lack of diversity
The economic downturn highlighted the weakness in Google’s revenue approach
Cost-per-click declined once again in 2012
The popularity of Internet-enabled mobile devices is growing
Internet-enabled portable hardware has been a key revenue growth driver for other technology companies
Mobile device Internet usage is rising dramatically
Google faces competition as a search engine
Bing and Baidu market share is growing
Non-traditional search engines are emerging as competitors
Competition in the search engine space could dramatically impact Google
GOOGLE’S NEXUS PROGRAM
Google now offers Google Nexus branded smartphones and tablets
The first Nexus branded smartphone surfaced in 2010
Google entered the tablet market years after its first smartphone
Google has employed a manufacturing partnership strategy for its Nexus range
Google has aimed to disrupt with the Nexus
The pricing of Nexus smartphones has shaken the market
Nexus tablets also retail for a highly competitive price
Google has experimented with different distribution models
Nexus devices are showcases for Google’s Android system
Android is a revenue opportunity for Google
Nexus devices represent a pure Android experience
Nexus device announcements have coincided with Android updates and mobile services
HAS THE NEXUS PROGRAM BEEN A SUCCESS?
Nexus devices have not been a direct revenue and profit driver
Pricing has hampered the overall profitability of Nexus devices
Dual branding has hampered profitability further
Distribution models have been limiting
Google has had mixed success at revolutionizing the industry
The Nexus 7 has changed the market share of the tablet market
Apple has now entered the small tablet sector
The Nexus 4 has struggled to make an impact
The Android system is flourishing
Revenues from the Google Play Store are growing
Android continues to be the most popular mobile operating system
Amazon’s Kindle strategy is a threat to Google
CONCLUSIONS
Google has seen limited success with Nexus
APPENDIX
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Copyright © FriedlNet. You may share using our tools Please don't cut content from FriedlNet and redistribute by email or post to the web.