Slog

News & Arts

Line Out

Music & the City
at Night

« Lunchtime Quickie: Bi-Curious? | Things I Have Found on the Ground,… »

Tuesday, January 12, 2010

Tech It's Hard to Do Everything, Even for Google

Posted by Anthony Hecht on Tue, Jan 12, 2010 at 12:06 PM

Google is starting to see the problems with becoming a distributor of mobile phones.

Google doesn't have customer support centers, with operators standing by. Instead they have email, forums, and FAQs. When you're dealing with something like your phone service, delivery of a very expensive gadget, etc., that's just not enough for most people.

And then someone discovered this nasty little surprise hiding in the fine print:

If you buy a subsidized Nexus One through your carrier and cancel your account you not only have to pay an Early Termination Fee (ETF) to your carrier but ALSO have to pay GOOGLE an ETF that automatically charges your credit card the remainder of full price of the phone.

Carrier ETFs make sense. If you buy a subsidized phone, the contract is the way the carrier ensures that they get the cost of the phone back. This is the first time I've heard of a phone seller other than a carrier charging a fee like this, though, and it certainly smacks of being charged for the same thing twice. Odd.

I expect there will be a fairly quick explanation or resolution to this specific problem, but it does point to a more general problem Google is facing as they expand into nearly every corner of the web.

Google has a habit of throwing things out there just to see what happens. It's a company run by engineers, and they want to solve problems, and they often do that very well. But that also means that there isn't always a solid (or any) business plan, let alone customer service plan, behind many of their initiatives. They launch products as betas, leave them as betas for years, etc. This was fine for a while, but increasingly Google is the storehouse for extremely important data that millions of people rely on every day, and now they're into another new area—selling people their prosthetic brains, err cell phones.

It will be interesting to see how/if they scale the non-tech parts of their business to meet these demands.

Comments (15) RSS

Oldest First Unregistered On Registered On Add a comment

Something like this was bound to happen sooner or later; between supporting Gmail, Google Office, Ajax, their mapping APIs, and now physical hardware, there are a lot of small businesses and individual customers that depend on both high availability and in-depth support. It sure is interesting watching Google grow up. I foresee more traditional MBAs populating the executive ranks within 5 years.

Posted by laterite on January 12, 2010 at 12:28 PM

And another "iPhone killer" bites the dust. I think that's two in a few months right? The Android thing and now Nexus.

Posted by Cato the Younger Younger on January 12, 2010 at 12:35 PM

This why I never buy version 1.0 of anything.

Posted by The Amazing Jim

on January 12, 2010 at 12:58 PM

Google doesn't really "do" customer support. When it's only a piece of free software, well, who gives a shit? But spending hundreds of dollars on a phone and having nobody to solve your problems - well, that's a very different story.

Posted by Fifty-Two-Eighty

on January 12, 2010 at 1:17 PM

I'm still trying to have some google voice issues resolved. You can post and poke around there forums and get some tribal info from others, but it's fruitless trying to get actual detailed information about a google service from google themselves.

Posted by stinkbug on January 12, 2010 at 1:17 PM

Oh, hell, I gave up on Google Voice a long time ago. It keeps telling me it's not yet available in my country.

Posted by Fifty-Two-Eighty

on January 12, 2010 at 1:30 PM

#2 "Andriod thing" bit the dust?

Posted by w7ngman

on January 12, 2010 at 1:32 PM

@2 - Android is the O.S., Nexus One is a phone. The Nexus is Android, and as @7 points out, neither have bitten the dust, not by a long shot. The point isn't that Android or Nexus are failures, just that Google is challenged by entering new markets that demand more active support.

Posted by Anthony Hecht on January 12, 2010 at 1:40 PM

The entire business plan is strange, so the extra fees come because of a clash between the old carrier-based business model with T-Mobile and Google trying to take that away and sell it directly (you pay Google the subsidy difference, which upon canceling T-Mobile isn't doing, but T-Mobile still has the $200 ETF in their contract). You're entirely right that Google has a habit of pushing things out before their ready. As for the support, Google says to go to HTC for hardware-related issues, and to the carrier for service-related issues. The problem is that they're terrible at communicating that.

@2 Android is an operating system, which is on a number of phones including the Nexus One. It's been rather successful, with every carrier (sans AT&T yet) having at least two Android-based phones, with many more coming. And Google isn't in the business of making an "iPhone killer," in fact the iPhone helps them. They're entire business is based around getting the most people on the web, with faster access to the web, and Android does that by offering a lot of different phones for different people.

Posted by Nick Nelson on January 12, 2010 at 1:54 PM

As far as the double ETF goes, it can happen in the cell phone industry. If you buy a cell phone from an independent agent ("Bob's Cell Phones" for instance), then many times they will have you sign an agreement saying that you will pay them a fee as well in you canceled. Circuit City used to do this back in the day*. There would be a $200 carrier fee, and a $300 Circuit City fee, because if you the customer canceled the service, then the carrier would no longer pay the agent the sales commission (and the agent was going to get that commission one way or another.)

* Back in the day meaning the late 90s for Circuit City. They may have changed that policy later (but somehow I doubt it.) Other agents had the same policy as of 2008, but those were mom and pop stores.

Posted by infrequentposter on January 12, 2010 at 2:28 PM

Android is hardly a failure but the hype surrounding the last few device releases sure make it sound as if there is an expectation for impact as immediate and far-reaching as the initial iPhone launch and its attendant cultural shift with regard to mobile data usage. But that's the problem. It's been done. The groundwork is already laid.

Posted by laterite on January 12, 2010 at 3:07 PM

I was talking about the Droid phone from Verizon

Posted by Cato the Younger Younger on January 12, 2010 at 3:41 PM

FTC should kill the both the phone subsidy and ETF model asap. It kills churn which has the effects of reducing competition, reducing customer service, raising prices. We pay so much for cell service compared to the rest of the world because the whole industry is too locked into this business model to change it. Contracts, subsidies and ETF are just the most consumer un-friendly way to charge for phones ever.

Posted by SchmuckyTheCat on January 12, 2010 at 3:51 PM

Hey #12, I work at Verizon and we have a hard time keeping the Droid on the shelf. This phone has NOT bitten the dust at all buddy.

Posted by TexNSeattle on January 12, 2010 at 4:39 PM

@9: You *really* need to figure out what their, there and they're mean and when you're (not your) supposed to use each one. Just because a word sounds the same doesn't mean it has the same meaning. They're (not their) homophones. And no, a homophone isn't some gay guy with a Razr phone.

Posted by Weekilter on January 12, 2010 at 10:34 PM