What to Make of Today's Google Announcements

I wish I could say it was a surprise, but the endless rumor mill of supply-chain leaks and rumblings usually gives us a heads-up of what to expect. And that was no different today when Google (Nasdaq: GOOG  ) unveiled its Nexus 7 tablet. However, the company did catch us off guard with a Nexus Q device that wasn't leaked ahead of time.

Without further ado, let's dig into the official details and see what it means for the search giant and the tablet market.

Nexus 7
The tablet is a direct shot at Amazon.com's (Nasdaq: AMZN  ) Kindle Fire, as expected, although it would also love to steal some sales from Apple's (Nasdaq: AAPL  ) higher-end iPad. The device is squarely aimed at the lower end of the tablet market that the Kindle Fire has come to dominate, while the iPad reigns supreme up top.

Nexus 7. Source: Google.

Nexus 7. Source: Google.

The Asus-built device carries a 7-inch display and a quad-core NVIDIA (Nasdaq: NVDA  ) Tegra 3. It's bumping elbows with the Kindle Fire at the $199 price point. Here's how it stacks up against the Kindle Fire and iPad in other spec departments.

Specification

Nexus 7

Kindle Fire

iPad (Third Generation)

Display 7-inch IPS 7-inch IPS 9.7-inch IPS
Screen resolution 1280 x 800 1024 x 600 2048 x 1536
Pixel density 216 ppi 169 ppi 264 ppi
Processor Quad-core Tegra 3 Dual-core TI OMAP Dual-core A5X
Operating system Android 4.1 Jelly Bean Android 2.3 Gingerbread (forked) iOS 5
Storage 8 GB / 16 GB 8 GB 16 GB / 32 GB / 64 GB
Weight 340 grams 413 grams 652 grams
Dimensions 198.5mm x 120mm x 10.45mm 190mm x 120mm x 11.4mm 241mm x 186mm x 9.4mm
Cameras 1.2-megapixel (front) None 5-megapixel (rear); VGA (front)
Price $199 / $249 $199 $499 / $599 / $699

Sources: Google, Amazon.com, Apple.

Just judging by specs, the Nexus 7 looks to have the Kindle Fire beat in just about every department. It carries a sharper display with a higher resolution, a beefier applications processor, and a newer operating system. It's also thinner and lighter, has a camera, and sits at the same price point.

It's in a different class altogether, though, compared with the iPad, which has a much larger display at an even sharper display. But the iPad costs more than twice as much. I'd love to also compare it with Microsoft's freshly unveiled Surface, which aims for the high end, but Microsoft simply didn't give us many details on the device.

Nexus Q
Google threw a curve ball today with the spherical Nexus Q, a new set-top box that streams up content to your living room. Google says it's "not another black box," but that's only because it's an orb and has an LED ring that encircles the device.

Nexus Q. Source: Google.

Nexus Q. Source: Google.

The streaming device carries a dual-core Texas Insruments OMAP, a slightly beefed-up version of the chip found in the Kindle Fire. Functionally, it's a clear shot at the Apple TV in terms of its streaming capabilities, except it doesn't support popular third-party content services like Netflix (Nasdaq: NFLX  ) , which is effectively a competitive requisite for any streaming set-top box nowadays. You can get to YouTube on the device, but of course Google owns YouTube.

The worst part about the Nexus Q? It costs three times as much.

The $300 price is three times the price of an Apple TV's $100, and six times certain Roku models that start at $50. There are a few possible contributing factors to this higher price tag. The New York Times is reporting that the device is manufactured domestically, a stark contrast to the broader trend of outsourcing manufacturing overseas. This seems like a textbook journalistic trade of access for positive publicity.

Also, the Nexus Q has an "audiophile-grade amplifier" built into it, while similar standalone amplifiers of comparable quality can cost up to $500.

With as much as Google bashes Apple's proprietary techniques, Google is asking an awful lot for a juiced-up amp that only taps into its own proprietary content storefronts. With Apple's offering supporting a handful of third-party content services, Google now officially has a product that's more closed off and proprietary than Apple. And for thrice the price.

It's all in the family
Overall, I'm thoroughly impressed with the Nexus 7, and decidedly unimpressed with the Nexus Q.

The Nexus 7 looks like a solid device that may help Android gain tablet market share, although it's now setting a very low price bar that undercuts Google's own hardware OEM partners while trying to lead them to victory. Hardware OEMs can't have it both ways.

The Nexus Q is destined to be an abject failure, because of its hefty price tag and limited capabilities. By definition, the audiophile market is a niche one, so bundling in a feature that primarily applies to that subset will limit its appeal to the broader market. The amplifier should be an extra perk, not a required feature.

You win one, you lose one.

While Google might now be winning on all fronts with this announcement, one of the companies it's working closely with is set to make a big impact on what our analysts are calling the next trillion-dollar revolution. To learn what this company is, and how it's positioned to capitalize on this revolution, grab a free copy of this report.

Fool contributor Evan Niu owns shares of Apple and Amazon.com, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Microsoft, Netflix, Amazon.com, Apple, and Google Motley Fool newsletter services have recommended buying shares of Netflix, NVIDIA, Microsoft, Google, Amazon.com, and Apple, writing puts on NVIDIA, and creating bull call spread positions in Apple and Microsoft. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 28, 2012, at 1:58 PM, Borbality wrote:

    Too many devices doing the same damn thing. Kind of cool to have an amplifier built in to the Q, but this is going to be a niche market of audiophiles whose wives won't let them get a big stereo. Definitely not going to be the next big thing among the average smartphone user.

    I haven't actually seen the quality yet, but even cheap new smartphones are offering 1080p through HDMI into your TV. Why get a separate device to do that?

    As far as the amplifier thing goes, I power my speakers with a separate small "Class D audiophile quality" amplifier I found on Amazon for $50.

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