30 Mar 12Sarah Vizard
Google is reportedly planning to open an online store that will allow it to sell Android-based tablets directly to consumers as it seeks to boost sales and the market share of tablets running on its operating system. A Wall Street Journal report, citing people familiar with the matter, claims that the store will initially sell tablets manufactured by Google’s hardware partners, such as Samsung and Asus, including the upcoming Nexus-branded Google tablet that is rumoured for release around May. The move is aimed at driving up sales of Android tablets, which Android chief Andy Rubin says have been “less than expected”. It will also pitch Google more directly into competition with its main rivals Apple and Amazon, both of which sell their tablets through online retail stores.
Google currently relies on retailers and mobile operator partners to sell Android-based smartphones and tablets. The strategy has worked well in the smartphone market, where the operating system is the number one globally. However, Google appears to be finding it harder to increase its market share in the tablet market. Despite the raft of devices running Android, Apple’s iPad remains far and away the dominant device, with its market share actually expected to increase this quarter following the launch of the latest iteration of the iPad. The only tablet to even come close to matching the success of the iPad is Amazon’s Kindle Fire which, just a few months after launch, is already number two in the market. But while it does run Android, it is a customised version of the OS, with analysts forecasting that it could eat into sales of other Android-based devices. That is particularly bad news for Google because the Kindle Fire has access to Amazon’s wealth of digital content, such as e-books and apps, rather than Google’s.
Google has made a move into online retail before, launching a store to sell its first smartphone – the Nexus One – which was manufactured in partnership with HTC. However, that site was shut down after just four months, with Google saying sales had failed to live up to expectations. Its lack of success was not surprising as consumers could only buy that one device via the store and Google provided no customer support. Google will likely have learned from that experience and, if it combines a hardware store with its Google Play content, could be a formidable player in the market.
Launching its own tablet retail store is just the latest sign of Google’s growing focus on the tablet market after Rubin said the firm would “double down on tablets”. The firm has already released a tablet-optimised version of Android, dubbed Ice Cream Sandwich, and is understood to be launching an update, codenamed Jelly Bean, in the middle of this year. Google has also bought Motorola Mobility, which many commentators are suggesting means the company is looking to make a move into hardware. The WSJ claims that Google is planning to sell Motorola tablets in its online store once it is up and running.
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