In a saturated mobile market, Google yields and lowers the price of the Pixel

Google’s commitment to consolidate itself definitively as a leading player among mobile phone manufacturers has coincided with the first signs of saturation in this market, which has led the company to give up and halve the price of its Pixels.

The announcement took place during the I / O developer conference held this week in Mountain View (California), where the company has its headquarters, an event that is usually reserved for software ads, but in which this year the hardware and specifically mobile phones played a leading role.

In front of the 799 dollars that Pixel 3 costs and 999 of its “bigger brother”, the Pixel 3 XL (that went on sale last October), Google presented in I / O the Pixel 3a and 3a XL for 399 and 479 dollars, respectively, price reductions of around half in each case. 

And it is that the firm that runs Sundar Pichai has seen how, despite having one of the devices most valued by the critics – Pixel 3 and Pixel 3 XL receive almost without exception the highest scores in the rankings prepared by experts -, your sales have not finished booting.

According to data from the statistical firm StatCounter, Pixel phones represent less than 2.5% of the total market in the US. , and Google’s own financial advisor, Ruth Porat, admitted in a call with investors at the end of April that Pixel 3 is selling even less than its predecessor, Pixel 2.

“The hardware results reflect lower Pixel sales on a year-on-year basis, partly because of the intense promotional activity across the industry as a result of recent pressures in the premium phone market,” said Porat.

The reasons why the Pixel fails to make a dent in the market does not seem to have to do with the quality of the product (has been a critical success) or compatibilities (Android, Google, is the most used operating system in all over the world), but you have to look for them in the slowdown of mobile sales in general and in the price of the Pixel in particular.

Against the first it is difficult for Google to fight: and, for example, in the second quarter of 2018 (the last one for which global data is available), they dropped by 1.8% worldwide with respect to the same period of 2017.

In fact, if Google is having problems to enter the market, a brand as consolidated and prestigious around the world as Apple is having to keep pace, since the end of 2018 the iPhone has fallen in a number of sales in almost the entire world, especially in China.

Given this situation, Google has chosen to maneuver with the only variable that is under its control: the cost to the client.

Reducing the price of one of the most expensive and expensive models in the market by half, practically keeping all the benefits and technique of the ‘premium’ version is a risky bet since it involves a 180-degree strategy change. part of Google, which had always wanted to compete in the segment of “luxury” phones.

However, it is the only alternative left to the company to try to encourage potential customers and is a trend that already marked just a few months before Apple with the release of the iPhone XR, which for $ 749 is selling much better than the XS and XS Max.