SAN FRANCISCO (Reuters) – Alphabet Inc’s Google unveiled on Tuesday the third edition of its Pixel smartphone, a Google Home smart speaker with a display and its first tablet computer, as it makes a come-from-behind push into hardware.
The Google Pixel 3 third generation smartphones are seen on display after a news conference in Manhattan, New York, U.S., October 9, 2018. REUTERS/Shannon Stapleton
The company’s Android software has gone from being an also-ran to the brains of most of the world’s smartphones, and Google topped Amazon.com Inc in smart speaker sales in recent quarters.
Pixel phones, though, have been a tougher sell, garnering less than 1 percent of the global market by shipments in Google’s first two years of trying, according to research firm Strategy Analytics, and launching with glitches.
The Pixel 3, priced at $799, and larger sibling Pixel 3 XL, priced at $899, mark Google’s latest entries into a phone lineup it hopes will someday be as popular as Apple Inc’s iPhone.
The new Pixel Slate tablet runs Google’s beefier Chrome OS laptop operating system rather than Android and is priced at $599, putting it in competition with Apple’s iPad Pro tablet series.
Shares of Alphabet barely moved on the release. Financial analysts said it is difficult evaluate Google’s hardware business as it is overshadowed by profits from search ads.
Google branched into hardware three years ago so that, like Apple, it could have full control of the performance of its applications and the revenue they generate. Other phone makers sometimes crowd out Google’s apps with their own or take a share of ad revenue.
Expanding geographic distribution is likely to boost Pixel’s fortunes. The Pixel 3 will launch in 10 countries, up from six for the Pixel 2 a year ago. New additions include France, Ireland, Japan and Taiwan.
Also helpful could be a new artificial intelligence tool sure to generate buzz among consumers. The software, launching in the United States only, answers phone calls, requests information about the nature of the call and shares it as text with the recipient.
“We’ve built the first phone that can answer the phone,” Rick Osterloh, Google’s senior vice president for hardware, told media on Tuesday.
Google shipped 2.53 million Pixel 2 and 2 XL devices through the nine months ended June 30, Strategy Analytics said. The first Pixel devices hit 2.4 million shipments in the nine months ended June 30, 2017, the firm said.
Limited adoption has reflected Google’s hesitancy to go as wide and big in distributing and marketing the Pixel as Apple, which launched its last two iPhone line-ups in about 50 countries.
Going from a small experiment to a polished product that works in various languages and is backed by large sales, support and technical teams has been part of Google’s challenge.
Last year’s Pixel 2 arrived with bugs that prompted user complaints about unwanted noises during calls, a crashing camera app and an unexpected screen tint. Google doubled warranties to two years in response.
Google Assistant, the signature virtual helper feature on the Pixel, was available in six languages a year ago and now supports 16.
In turn, Google hosted 10 unveiling events across the world on Tuesday, including in New York, London, Paris, Tokyo and Singapore, spokesman Kay Oberbeck said.
Still, the Pixel 3 could see limited uptake in the United States as Google again signed an exclusive distribution deal with wireless carrier Verizon Communications Inc that means the device will get little marketing from other carriers.
Google said it would augment distribution by opening on Oct. 18 two temporary stores in popular neighborhoods of Chicago and New York and putting up displays at U.S. retailers B8ta and Goop.
Google’s new smart speaker, which has a display to show visual responses to voice commands, mostly matches offerings from Amazon.com Inc and Facebook Inc.
But unlike its competitors, Google said its Home Hub, priced at $149, does not have a video conferencing camera.
The nod to privacy concerns comes as Google and other big U.S. tech companies try to bounce back from recent data breach scandals.
Amazon shipped 21.5 million smart speakers, including those with displays, in the year ended June 30, compared with 18.3 million for Google, according to research firm Canalys.
Google said in a blog post on Tuesday that it recently delivered some Google Home speakers within 10 minutes of ordering using drones from Alphabet’s Project Wing.
Shares of speaker maker Sonos Inc were down 5.6 percent on Tuesday.
Reporting by Paresh Dave and Arjun Panchadar; Editing by Leslie Adler, Peter Henderson and Meredith Mazzilli