Google Nexus 7 Tablet Will Sell at Cost

The story of ASUS and Google’s team development of the Google Nexus 7 Tablet started circulating around the web soon after the Google I/O 2012 Keynote at which Google unveiled the Kindle Fire-like device. It turns out the Nexus 7 will sell at cost and took about 4 months to make.

Google sells the device directly through the Google Play Store and will do all the marketing for ASUS, allowing ASUS to create the tablet at such a bargain price, according to All Things D. The two companies said they will sell the Google Nexus 7 with very little profit margin. Like Amazon, Google wants to put the device in the hands of consumers so they can buy media and apps.

ASUS Chairman Jonney Shih told All Things D that the tablet wasn’t easy to make. He first cited the short time frame given to his company. Google asked them to build the device in just four months, a short period for a new product. I’m sure they used what they learned in creating earlier Android tablets, so don’t cry too loudly for the ASUS engineers.

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Shih also noted that Google wanted a tablet with nice specs for just $200. They likely picked that price so that it would compete with other 7-inch tablets already out, namely the Amazon Kindle Fire, the Nook Tablet and Samsung’s Galaxy Tab 7-inch model, all of which sell for $200-$250. Shih said his engineers called it “torture.”

Inside the company they named the Nexus 7 “Project A-Team” and closely allied their engineers with Google’s. The teams came up with the signature Android 4.1 Jelly Bean tablet that Google gave to developers and attendees of the Google I/O event. Rubin gave high praise to Shih and his team saying he didn’t believe that any other company “could move that fast.”

Not pleased with the way earlier Android tablets sold, Rubin believes that the buyers want an entire collection of content associated with the tablet for a it to succeed. Amazon sells its Fire with such an ecosystem and likely represents a big part of Apple’s success with the iPad. So, Google added things like TV Shows and Magazines to its collection of apps, movies and books in the Google Play store. They believe they now can offer the collection of apps and media that supports a great device.

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The two companies hope their offering will compete with the Kindle Fire in terms of hardware. The Kindle Fire doesn’t offer the same performance as the Nexus 7 and it also limits users to Amazon’s version of Android instead of offering a complete Android experience.

We’ll see if they’re right when the Google Nexus 7 Tablet ships next month.

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