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Google Hopes Whale of a Phone Will Make Splash in Phablet Market
Google Hopes Whale of a Phone Will Make Splash in Phablet Market- A Google GOOGL -2.74% employee demonstrates playing a video on a Nexus tablet and transferring it to a television in July, 2013 in San Francisco, California.
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Google this month expects to release its largest smartphone, intensifying competition in the fast-growing market for super-sized mobile devices known as phablets, according to three people familiar with the situation.
The new phone — code-named Shamu after a killer whale — will have a 5.9-inch screen, a high-resolution display and be sold under the Nexus brand, two of the people said. Motorola Mobility, the phone maker that Google is selling to China’s Lenovo Group Ltd.0992.HK -5.05%, is manufacturing the phone, the people added. A Google spokeswoman declined to comment.
The new phone will be larger than Apple AAPL -0.29%’s iPhone 6 Plus, which is 5.5 inches, and the Samsung Galaxy Note, the first truly successful phablet, which is 5.7 inches. Google plans to release a new version of its Android mobile-operating system at the same time. Tech blog The Information reported in July that Motorola was working on a Nexus phablet with Google.
Phablets, defined as smartphones with displays five inches or larger, were once ridiculed as unwieldy bricks for short-sighted, older consumers. But as phones have evolved from calling devices into computers for work tasks and watching videos, larger devices have caught on.
In 2011, phablets accounted for 1% of global smartphone shipments. This year, these big phones will make up 24% of the market, according to consultants Strategy Analytics. Stats like that forced Apple to drop its aversion to larger iPhones this year and now Google is responding.
“The phablet wars are in full effect and vendors need any possible edge they can get,” said Neil Mawston, a mobile-industry analyst at Strategy Analytics. “Having a large phone will help Google.”
Google has multiple goals with its Nexus phones and tablet computers. The company wants to sell devices, but it also uses the gadgets to help its software developers test updated versions of the Android operating system on the latest hardware. Google also hopes other Android phone makers will adopt features of Nexus devices.
Until now, the largest Nexus phone is the Nexus 5, which measures five inches. Nexus tablets are larger, but don’t include cellular connections.
“If Android doesn’t have something at that size there will be a hole in their portfolio,” said Ankit Jain, CEO and founder of mobile start-up Quettra and a former executive at Google Play, the Android app store. “Google doesn’t want to make the same mistake that Apple made over the last few years by missing out on the demand for larger phones.”
A flagship phablet for Android may help Google reach new customers in emerging markets who are not online yet and don’t own a computer. That’s a top strategic goal of Sundar Pichai, who runs Google’s Android business.
“A lot of people buying their first phones in emerging markets tend to use them as pocket computers and bypass desktops and laptops,” said Mawston. Phablets are capable enough to satisfy the needs of such new Internet users, he added.
Phablets are also popular among some Asian consumers as a status symbol, along with a large house and car. Having a large Nexus phone with a high-resolution screen should help Google compete more with Apple for wealthier consumers in the region, Mawston said.
Google hopes to deliver a Nexus phone that rivals the iPhone 6 Plus on display quality but at a lower price, according to one of the people familiar with the new device. The iPhone 6 Plus starts at $749 without a contract in the U.S. and costs more than $800 in Asia.
“Competing with Apple was probably a significant part of their thinking,” said Daniel Matte, a mobile analyst at technology research firm Canalys.
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