Ron Miller thinks so. His key point?
” once again Google is treading into unfamiliar territory. Companies tend to fail when they go outside their comfort zone (Appleâ€™s foray into retail stores being a notable exception). My feeling is Google doesnâ€™t know much more than it did the first time about retail. Itâ€™s just a desperate attempt to jump-start the anemic Android tablet market.”
It’s not as if Google’s smart phones did not sell. They sold well enough for their purpose, to provide a reliable platform for Android/Linux development. The same situation will likely hold for the new tablets unless Google lines up some big OEMs to push the product. Google has lined up ASUS or Samsung, both of whom know how to sell product. In its latest report, Google stated
- revenues of $10.65 billion in the first quarter of 2012, representing a 24% increase over first quarter 2011
- Google-owned sites generated revenues of $7.31 billion
Google’s total investment in Android/Linux is just pocket-change (cash = $49.3billion) for them and they are making the market for its search and app business grow by shipping more smart thingies and encouraging other suppliers to do the same. Even if users of smart thingies are not replacing their PC with a smart thing, they are increasing the hours of the day they can access Google’s services by mobility. There is no downside for Google. There would be a serious downside if they stuck with the stagnant Wintel platform. Google would not have 24% growth staying with Wintel only.