Google Unveils New Nexus 7

Google unveiled a new version of its Nexus 7 tablet computer
Wednesday, boasting new features like a virtual surround sound and a
faster processor, as it looks to boost Android's lead over Apple 's
iPad in terms of market share for tablets.

Google showed off the new device, designed in partnership with Asustek
Computer , at an event in San Francisco. It is powered by an updated
version of Android, which also is the No. 1 software for smartphones.

The Mountain View, Calif., company is working to fend off Apple and
its popular iPad tablet, as well as Amazon.com's Kindle Fire tablets.
Sundar Pichai, senior vice president of Android and Chrome, said
Android tablets now account for nearly half of all such computers sold
worldwide.
"By the end of 2013, consumers are going to buy more tablets each year
than personal computers," said Pichai.

The new tablet, which goes on sale at Best Buy Wal-Mart and other
retailers July 30, costs $229 with 16 gigabytes of storage and $269
for 32 gigabytes, according to Google and the Best Buy website. That
compares to $329 for the 16-gigabyte iPad mini, an 8-inch tablet, and
$429 for the 32-gigabyte version.

The device will soon be available in major markets in Europe and Asia,
Google said.

The new Nexus device has parental controls so an owner can restrict
the type of apps their children can access, as well as 3D graphics and
video compression capabilities that would appeal to videogame app
developers, said Android executive Hugo Barra, at the event.

Google's support for the Nexus tablet serves several purposes,
including the need to compete with Amazon's $159 Kindle Fire tablet, a
formidable threat to Google. Unlike the majority of Android devices,
Amazon's tablet uses a separate version of Android that doesn't come
with Google services pre-installed. (Android is a free, open-sourced
software, so it is available to anyone.)

Google is currently at work on a major update of Android software that
is expected to be unveiled sometime later this year. Nearly a billion
Android devices have been activated since 2008, the company has said,
allowing Google to ensure that its revenue-generating services such as
Google Search have a guaranteed spot on people's mobile devices.

The Nexus 7 has a high-definition display that is more advanced than
that of the iPad, but its 1.5GHz Qualcomm Snap dragon S4 Pro quad-core
processor is less advanced than some Android enthusiasts had expected.

The Nexus 7 became the most successful device in the history of the
Nexus program—at one point selling at a rate of about one million
devices per month—after being launched last year. Typically, Nexus
devices cater to hardcore fans of Android and are meant to show
hardware makers what they can do with the Android operating system,
but aren't meant to be big sellers.

Still, Asus-made tablets still were a distant No. 4 behind Apple
Samsung Electronics and Amazon in terms of shipments during the
critical fourth quarter of last year, according to research firm IDC.

The Nexus 7 succeeded in part because it was the most advanced
Android-powered tablet on the market at the time and thanks to its low
$199 price tag and significant marketing push by Google, which some
analysts believe subsidized the device so that it cost the same as
Amazon's Kindle Fire tablet at the time.

Amazon has yet to release the next version of the Kindle Fire, which
is expected to be available before the fourth-quarter shopping season.

Unlike Apple, which generates hefty profit from the sale of hardware,
Google and Amazon play a different game. Google, which does get an
undisclosed cut of Nexus 7 sales, simply wants as many Android-powered
devices in the market because they are preloaded with
revenue-generating services such as YouTube, Google Search and Google
Maps. Amazon's bet is that customers will use its tablet to shop for
products and digital media that is sold by Amazon.

For Google, increased sales of Android tablets can help its financial
results in the short term, as prices for online ads viewed on tablets
are higher than for ads viewed on smartphones and nearly in line with
ads viewed on PCs. The rise of smartphones has weighed on Google's
revenue growth in recent quarters.
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