Nexus One - a bargaining chip for Google

The Wall St Journal, amongst others is reporting today that Google pulled back the Nexus one from the Verizon network in the US. Ie. Google will not be making/selling a CDMA version of the Nexus one phone in the US.

While the WSJ labeled the move as a sign of Nexus one's commercial failure, it seems to me that the Nexus one was likely doomed to never make it as big as the iPhone in it's current incarnation. Further, I would argue that Google probably knew this - going up against the Apple marketing machine and the entrenched Blackberry regime was never going to be easy. Finally, Google only deployed limited PR to promote the Nexus one - just enough catch to everyone's attention but never enough to enable mass sales.

A plausible explanation for the Verizon pull back is that Google is using the Nexus one as a bargaining chip to extract concessions from players in Android ecosystem including Verizon, HTC and Motorola. One of Google's major mobile goals is to promote Android. Selling its own Android-powered phone against the iPhone and Blackberry while possible, is hardly cost efficient. Using the Nexus one to make the environment for Android more hospitable seems to be a much better strategy to popularize Android.