Google, You’re Pricing it Wrong (Premium)

Dear Google,

We have a problem. You seem to believe that just because the market leaders have priced their new flagship smartphones in the stratosphere, you can too. Well, I have bad news for you. You can’t.

I’m writing this for reasons both selfish and altruistic. Selfishly, I cannot afford the ludicrous $949 pricing you are about to bestow on the Pixel 2 XL, the next phone you’ll market that no one will buy. Altruistically, I’m hoping that you’ll change your Borg mind to benefit the masses, and not just for me. After all, you don’t even know I exist.

So here’s the thing.

You’re not Apple. And you’re not Samsung either. These companies, these titans of the smartphone world, can market devices that cost about $1000 because they are the market leaders. They’re popular. These products are best-sellers, and they bring advanced new technologies—or, in Apple’s case, advanced years-old technologies—to the masses. They sell $1000 smartphones because they can.

You, however, cannot do this. Will not, in fact, do this. Are, further, artificially limiting the success of your new phones, and are thus undermining your entire hardware lineup and the very reason you make your own hardware in the first place.

Google, you sometimes get this right. Back in 2015, you marketed the Nexus 5X and Nexus 6P at what I’d call—did, in fact, call—the sweet spot for each device, respectively. That is, instead of matching the prices of the devices that people would actually buy, you undercut those prices. In doing so, you gave potential customers a reason to take a chance on an unproven device, an unknown quantity.

Google, I gave this same advice to Microsoft a few years back. Argued that, instead of flooding the market with dozens of basically identical and low-end Lumia smartphones in a mad bid to achieve some volume of sales that was never going to happen, it should instead offer true flagship handsets, and do so at bargain prices. Back then, there was no good reason for any sane person to spend as much on a handicapped Windows phone as they would on a perfectly decent Android handset or iPhone.

Google, Microsoft didn’t listen. In late 2015, it announced and began selling two flagship smartphones, the Lumia 950 and the Lumia 950 XL phablet. And as I wrote in my review at the time, the devices were “simply too expensive.” Instead of undercutting the market leaders, Microsoft simply matched their pricing. And ensured that the Lumia lineup, and Windows phone, would die. Which they did: Just a few months later, Microsoft started holding fire sales to get rid of the unwanted inventory.

Google, you don’t want to have a fire sale, and you most certainly don’t want the bad PR that goes along with that. You don’t—dare I say it?—want to pull a Microsoft. I can tell. You want to do the right thing.

Fortunately, you have good examples to copy—er, sorry, I know that’s a sensitive topic for you, given how easily you fall into that trap—or … emulate. That is, instead of copying Apple’s and Samsung’s pricing, you should copy Motorola’s. And OnePlus’s.

Now, you used to own Motorola, and I’ll pause for just a moment so everyone can appreciate the irony. But here’s the thing. Motorola gets it. And you do not.

So let’s compare how these companies price devices that basically match the specs and capabilities of the new Pixel 2 devices you are going to announce next month. Just for giggles.

Over at OnePlus, a OnePlus 5 with 6 GB of RAM and 64 GB of storage costs $479. This phone has a 5.5-inch display, so it is perhaps closer to the Pixel 2 (4.97-inch display) than the Pixel 2 XL (6-inches). I know, it’s not a perfect comparison. But OnePlus gets it.

The Pixel 2 with 64 GB of storage (also, 4 GB of RAM) will cost $649. That is almost $200 more than the comparable OnePlus handset. Come on, Google. That’s the cheapest phone you’ll be selling, for crying out loud.

How about Motorola?

Motorola offers several different Moto Z flagship models, and, granted, some of them can get expensive. The Moto Z Force, for example, with its 5.5-inch display, 4 GB of RAM, and 64 GB of storage costs $720. That’s more than the Pixel 2, but the display size is between that of the Pixel 2 and the Pixel 2 XL, which starts at $849. And unlike the Pixel 2 family, the Moto Z family is expandable, with modular add-ons that offer a real value and differentiation over the competition. More to the point, you can get other Moto Z devices, with the same expandability, for a lot less. The Moto Z Play, for example, starts at just $408. And Motorola offers many other handset models and varying price points. By which I mean, Motorola gets it.

Google, don’t pull a Microsoft. Don’t screw me and countless millions of others out of a savings of at least $200 over what we’d pay if we went with a Samsung Galaxy S8, S8+, or Note 8, or an Apple iPhone whatever. You need to be better than that, from a pricing perspective, so the market can find out whether you’re actually better than the competition. If you just price your devices at the same level, no one is ever going to bother. And at that point, you may as well just rename the Pixel lineup to Lumia. Because who would even care?

So thanks for listening Google. I know you’re not going to do the right thing. But I had to try.

Love, Paul