May 27, 2010, 2:44 PM

Google closes up shop on its first venture into e-commerce

After only six months, Google Inc. plans to halt sales of its Nexus One smartphone through its online store, the search engine’s first foray into e-commerce.

Zak Stambor

Managing Editor

After only six months, Google Inc. plans to halt sales of its Nexus One smartphone through its online store, the search engine’s first foray into e-commerce.

“While the global adoption of the Android platform has exceeded our expectations, the web store has not,” wrote Andy Rubin, Google engineering vice president, in a blog post. “It’s remained a niche channel for early adopters, but it’s clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to choose from.”

Google launched its web store, Google.com/phone, to sell the Nexus One, which uses Google’s Android operating system, directly to consumers. At its launch, Google said the site aimed to make buying a mobile phone and service easier by enabling consumers to buy the phone separately from phone service.

That’s unlike the standard practice in the U.S. where consumers typically buy a phone and service as a package from a mobile network operator. When consumers buy a phone with a long-term contract, mobile network operators typically offer the phone at a subsidized price. For example, Google sells the phone without service for $529, or $179 with a two-year contract from T-Mobile USA.

The dominant search engine says it plans to work with phone carriers to sell the device through carriers’ retail stores.

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