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Morgan Stanley: Pixel Phone Will Generate Google Almost $4 Billion In Revenue Next Year (9to5google.com)

Posted by BeauHD on from the be-laughing-all-the-way-to-the-bank dept.

An anonymous reader quotes a report from 9to5Google: With initial Pixel pre-orders exceeding expectations and promising activation numbers from Verizon, Google is on track to sell three million phones with revenues of $2 billion in 2016. The Morgan Stanley estimate comes as the Pixel reportedly captured 10% of the premium smartphone market in India. Unsurprisingly, the 128GB Pixel XL has the largest gross profit margin at 25%, while the cheapest 32GB Pixel is at 22%. Morgan Stanley also estimates that, compared to the iPhone, the Pixel will be half as profitable. Morgan Stanley expects Google to sell 5-6 million Pixel and Pixel XL devices in 2017 to the tune of $3.8 billion in revenue. Google is also expected to make money from increased usage of services like Android Pay and mobile search. Google's big gains were possibly due in part to Samsung's Note 7 debacle, with the company's marketshare falling to 23%. Apple captured the number one position at 66%. Additionally, Google benefitted from running a number of promotions, including cashback and exchange programs. The company also heavily advertised in newspapers, with billboards, and for the first time displays in large retail stores.

66 comments

  1. iPhone by 110010001000 · · Score: -1, Troll

    People that matter use iPhones. Period. Android is fake open source spyware with a malware laden app store.

    1. Re:iPhone by sexconker · · Score: -1

      You're a troll and Android is also shit, is not open source, and it basically malware itself, but iPhones are also shit and the morons who use them don't matter anymore than the rest of the morons who use Android, black turtleneck or not.

    2. Re:iPhone by Yvan256 · · Score: 1

      Okay so... no iOS and no Android. Didn't Microsoft leave the smartphone business a few months ago?

      What's left apart from regular, non-smart cellphones?

    3. Re:iPhone by 110010001000 · · Score: 1, Funny

      100% correct. #peoplewithblackturtlenecksmatter

    4. Re:iPhone by 110010001000 · · Score: 2

      Motorola StarTAC.

    5. Re: iPhone by Anonymous Coward · · Score: 0

      iPhone sales are the result of people who will never realize that price does not equal superiority. Apple has quickly become a Hodge podge mess. The mess that Google used to be.

    6. Re:iPhone by sexconker · · Score: 2

      Nothing viable in the modern market or in the near future, as far as I can see. It really fucking sucks. I went from being an enthusiastic early adopter of smartphones (well before the iPhone) to being a jaded, hateful pile of salt.

    7. Re:iPhone by 110010001000 · · Score: 4, Insightful

      I just can't believe that people are paying these prices for phones. The Pixel XL is $870! Probably the iPhone 7 is similar. Seriously? For a phone?

    8. Re:iPhone by Anonymous Coward · · Score: 0

      Same. I suppose I should log in but ... fuck it, I don't care.

      The iPhone is a shitty crappy phone used by idiots. Like me, who use it because while it's a shitty crappy phone made by a shitty crappy company that doesn't give two fucks about its customers, it still manages to be ever so slightly less shitty than the phone made by the other shitty company that doesn't give even half a fuck about their users because their customers are really the advertisers they sell all their data to.

      I have high hopes for the Pixel - at the very least, maybe it'll finally provide the competition for Apple to start trying again.

      But right now? I still trust Google less on the "maintain a product line" front than I do Apple. And that says a lot.

    9. Re:iPhone by Anonymous Coward · · Score: 0

      "Morgan Stanley also estimates that, compared to the iPhone, the Pixel will be half as profitable."

      Is this supposed to be a bad thing for a revenue seeking company?

    10. Re: iPhone by Anonymous Coward · · Score: 0

      open source -> spyware is oxy moronic because its free for any one to look at.

    11. Re:iPhone by Tough+Love · · Score: 1

      People that matter use iPhones.

      Right, because moms matter.

      --
      When all you have is a hammer, every problem starts to look like a thumb.
    12. Re:iPhone by Anonymous Coward · · Score: 1

      their customers are really the advertisers they sell all their data to

      Sigh. Google does not sell data to advertisers. Google sells targeted eyeballs to advertisers. The user data is both safer and more valuable if Google keeps it.

    13. Re: iPhone by Anonymous Coward · · Score: 0

      >>I just can't believe that people are paying these prices for phones. The Pixel XL is $870! Probably the iPhone 7 is similar. Seriously? For a phone?

      It's a phone, it's a camera, it's a handheld computer! It's got apps!

      My life has changed since I got a smart phone, I have managed to reduce my movement by 80%... Ordering pizza from your phone! Apps!

    14. Re:iPhone by Gussington · · Score: 5, Insightful

      I just can't believe that people are paying these prices for phones. The Pixel XL is $870! Probably the iPhone 7 is similar. Seriously? For a phone?

      $870 over two years is just over $1/day. Most people spend more than that on a coffee or newspaper. Which one offers more value?

    15. Re:iPhone by 110010001000 · · Score: 2

      A newspaper. Maybe then you will stop staring at your fucking phone and read a little about life.

    16. Re:iPhone by rahvin112 · · Score: 2

      When you buy that similar phone on contract from your carrier for $200 you are paying that plus about 20%. Monthly cellular costs are vastly inflated by the monthly charge this adds to the bill. As an example, a typical no frills family plan for two people is going to cost you around $120 with all the taxes. I'm paying roughly $70 with GoogleFi because they don't add in the phone costs automatically and when you do request the payment plan and they do include the cost it's properly itemized and only you pay it not every subscriber. And though I paid $870x2 upfront my monthly bill is $50 cheaper. In two years I'll have paid significantly less then if I'd gotten the same thing using the standard pay $2-300 per phone upfront and pay an extra $50 a month for two years.

      Though I would have preferred a price that was as cheap as the Nexus phones the Pixel in my opinion is worth the cost even given the negatives (no SD card). And Google Fi make it even better.

    17. Re:iPhone by TheGratefulNet · · Score: 1

      I see all the millennials walking down the street, staring at their phones and not where they are walking. I never see anyone walking and reading a newspaper or book while on the street.

      maybe darwin is listening and we can thin out the crufty herd a bit ....

      --

      --
      "It is now safe to switch off your computer."
    18. Re: iPhone by K.+S.+Kyosuke · · Score: 1

      If you want to say #jobsmatter, why in so many words?

      --
      Ezekiel 23:20
    19. Re: iPhone by Anonymous Coward · · Score: 0

      Ordering pizza from your phone!!

      please. I think people would want that would already have a watch app for the same thing.

    20. Re:iPhone by tlhIngan · · Score: 1

      Sigh. Google does not sell data to advertisers. Google sells targeted eyeballs to advertisers. The user data is both safer and more valuable if Google keeps it.

      No, Google does not sell to advertisers. Because Google IS the advertiser. They own practically all the advertising networks, have re-jigged their privacy policies to ensure data sharing takes place between all of them (Google Text Ads, YouTube, etc will share data with Alphabet companies like DoubleClick, so everything you do online will affect the ads you see).

      Google sells access to eyeballs.

    21. Re:iPhone by Dutch+Gun · · Score: 1

      Plus, even if I were to buy the most expensive Pixel, I tend to keep my phones for quite a while (over three years for my current model and going strong). So, I'm probably paying under a buck a day for the phone, and another two for my data plan. For that, I get a:

      * phone
      * texting / messenger client
      * e-mail client
      * mobile web browser
      * GPS navigation device
      * Kindle reader
      * camera / video recorder
      * video player
      * music player
      * calendar
      * videogame player
      * alarm clock
      * flashlight
      * compass
      * and much more

      ... all in one convenient, portable device more powerful than supercomputers of a few decades ago. It's not a bad deal, if you ask me.

      --
      Irony: Agile development has too much intertia to be abandoned now.
    22. Re:iPhone by nospam007 · · Score: 1

      "$870 over two years is just over $1/day. Most people spend more than that on a coffee or newspaper. Which one offers more value?"

      You're right. Newspapers have real news while smartphones have fake ones, which are much funnier.

    23. Re:iPhone by Anonymous Coward · · Score: 0

      This morning I saw a woman on her phone collide with an 8-year old boy, throwing him to the ground three feet away, and just glared at him before turning back to her phone without a word. Apparently the assumption is that if you're on your phone, it's everyone else's responsibility not to bump into you.

    24. Re:iPhone by jareth-0205 · · Score: 1

      Delivery medium != content. You know that these newfangled devices can contain books and newspapers now? Or is bring printed on paper somehow morally superior?

    25. Re:iPhone by jareth-0205 · · Score: 1

      Yeah. Maybe they can read news on the internet or something.

    26. Re: iPhone by dnaumov · · Score: 1

      It's a computer that can make calls (which I almost never use). I paid just over 1000â for mine.

    27. Re:iPhone by Plumpaquatsch · · Score: 1

      A newspaper. Maybe then you will stop staring at your fucking phone and read a little about life.

      Yeah, people running around on the streets looking at their newspapers will make the world a much safer place.

      --
      Of course news about a fake are Fake News.
    28. Re:iPhone by Plumpaquatsch · · Score: 1

      "$870 over two years is just over $1/day. Most people spend more than that on a coffee or newspaper. Which one offers more value?"

      You're right. Newspapers have real news while smartphones have fake ones, which are much funnier.

      Even if you exclude tabloids from newspapers, not really.

      --
      Of course news about a fake are Fake News.
    29. Re:iPhone by Anonymous Coward · · Score: 0

      wrong, out of the 3 things, the newspaper has zero value

    30. Re:iPhone by Anonymous Coward · · Score: 0

      I'm using a Meizu Pro 5 Ubuntu Edition - has pretty much everything I need: standard phone (4G) with messaging, email etc, turn-by-turn navigation (not gmaps), and I can run desktop apps (Libreoffice etc.).

      Up to 160/192GB of storage (128GB on Micro SD card) with blue-tooth keyboard and mouse, it's basically a Ubuntu system on a 5.7" phone (becoming a full Ubuntu system when convergence is completed, slated for 2018).

      Love it.

      btw, the Pro 5 Ubuntu Edition sold out some time back. I bought a standard Flyme version, and converted to Ubuntu. Fairly straight forward.

      Best thing, of course, no Apple, Microsoft or Google tracking. Yay.

    31. Re:iPhone by Anonymous Coward · · Score: 0

      "What's left apart from regular, non-smart cellphones?"

      I'm using a Meizu Pro 5 Ubuntu Edition - has pretty much everything I need: standard phone (4G) with messaging, email etc, turn-by-turn navigation (not gmaps), and I can run desktop apps (Libreoffice etc.).

      Up to 160/192GB of storage (128GB on Micro SD card) with blue-tooth keyboard and mouse, it's basically a Ubuntu system on a 5.7" phone (becoming a full Ubuntu system when convergence is completed, slated for 2018).

      Love it.

      btw, the Pro 5 Ubuntu Edition sold out some time back. I bought a standard Flyme version, and converted to Ubuntu. Fairly straight forward. Also, half the price of Pixel or iPhone.

      Best thing, of course, no Apple, Microsoft or Google tracking. Yay.

    32. Re:iPhone by AmiMoJo · · Score: 1

      They have those on the internet now.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    33. Re:iPhone by nightfire-unique · · Score: 1

      You ain't be readin' about life in a newspaper.

      --
      A government is a body of people notably ungoverned - AC
    34. Re:iPhone by Anonymous Coward · · Score: 0

      Who keeps buying flagship phones? You can get 80% of the functionality in a phone that's 10% of the price.

    35. Re: iPhone by Anonymous Coward · · Score: 0

      We need to give kids herf guns. Maybe Hasbro can come out with one, disguised as a toy.

    36. Re: iPhone by Anonymous Coward · · Score: 0

      My Galaxy J3 was $120. My total monthly from Virgin Mobile is $40. That includes unlimited voice and 4GB of full speed data.

    37. Re: iPhone by Anonymous Coward · · Score: 0

      Only three of my most clueless female in-laws have iPhones. Because they are on my mother-in-laws plan and she got sold them.

    38. Re:iPhone by tlhIngan · · Score: 1

      I just can't believe that people are paying these prices for phones. The Pixel XL is $870! Probably the iPhone 7 is similar. Seriously? For a phone?

      Especially because of the limited support - Google's support for the Pixel phones is 2 years of updates, and after that it's a year of security updates. (Nexus phones had 18 months from the last available sale on the Play store - which is why they had the 5P and 6X phones - they were released pretty much by month 18 when the Nexus 5 and 6 disappeared).

      Of course, then there's Apple's rather legendary software update schedule which at least makes the iPhone 7 supported for many years...

    39. Re: iPhone by Anonymous Coward · · Score: 0

      Not true. I collect old newspapers from around the office to use as kindling in my fire pit. Sure, the Galaxy Note 7 has an app for that, but it only works once and I'm not going to cook food over a Samsung fire.

    40. Re:iPhone by Anonymous Coward · · Score: 0

      For a buck you can read ONE real analog newspaper. Drop your daily dollar on the smartphone and you can read a hundred.

    41. Re:iPhone by exomondo · · Score: 1

      I just can't believe that people are paying these prices for phones. The Pixel XL is $870! Probably the iPhone 7 is similar. Seriously? For a phone?

      If what you want is just a phone then no, you wouldn't be paying that much because you can get a phone for much much cheaper than that.

    42. Re:iPhone by Anonymous Coward · · Score: 0

      A newspaper. Maybe then you will stop staring at your fucking phone and read a little about life.

      Maybe this is all new to you but reading the newspaper is precisely the sort of thing people are doing when they are staring at their phones. Whether you're reading it on a dead tree or an electronic device makes no difference, except that the latter is more up to date. You're getting all riled up and angry at your own ignorance, maybe you just need to learn a little about what a smartphone is. Hint: It isn't just a phone like you so obviously think.

    43. Re:iPhone by Gussington · · Score: 1

      I see all the millennials walking down the street, staring at their phones and not where they are walking. I never see anyone walking and reading a newspaper or book while on the street.

      Did it ever occur to you that they are reading the newspaper or book on their device?

    44. Re:iPhone by Gussington · · Score: 1

      * and much more

      ... all in one convenient, portable device more powerful than supercomputers of a few decades ago. It's not a bad deal, if you ask me.

      It's a great deal which is why $1000 phones are still popular.

    45. Re:iPhone by Gussington · · Score: 1

      Newspapers have real news while smartphones have fake ones, which are much funnier.

      Every news agency has an online presence. So with the phone you get a phone and newspaper (and a GPS, and a camera, and email, and a banking system, and a gaming machine, almost unlimited content etc etc), whereas with the newspaper you only get the newspaper. And they cost about the same. And you think it's the phone that is priced too high?

  2. real open source by Anonymous Coward · · Score: 0

    Nokia N900

    1. Re:real open source by EzInKy · · Score: 2

      Mine, after nearly 7 years of daily use, sadly is on its last legs. And to be honest it never was 100% true "open source". Nothing available now that I know of comes even close though. Someone I know bragged about having 64gb of storage, I've had that like for near 7 years now. And if I needed more all I have to do was swap out the memory card. And I really don't get this slim fetish.

      --
      Time is what keeps everything from happening all at once.
    2. Re:real open source by Tough+Love · · Score: 1

      Well, maybe this one from Nokia[1] will be good. Maybe it will have sdcard, unlockable rom, decent battery life, good radio. Who knows.

      [1] The real Finnish company, not the Microsoft zombie

      --
      When all you have is a hammer, every problem starts to look like a thumb.
    3. Re:real open source by TheGratefulNet · · Score: 2

      fuck nokia and also ericcson. both scandinavian companies and both, in the US, drug-test their employees.

      both those companies are on my do-not-buy list. I disagree with what they consider important and so I will not give my money to them for any reason, if I can help it.

      some people don't care, but when I find companies that follow ultra conservative ideals and force them on their employees, that really pisses me off and I have no desire to buy their products.

      --

      --
      "It is now safe to switch off your computer."
    4. Re:real open source by EzInKy · · Score: 1

      Nope, not a chance. I see no mention of an integrated hardware keyboard, and it is less open the Harmatten. Open is open. Manufacturers dictating control is not open. Nokia cam close with the N900, all that was needed was someone to take it just that small step forward.

      --
      Time is what keeps everything from happening all at once.
    5. Re:real open source by EzInKy · · Score: 1

      How is your "do not spy list" shaping up? Of course your privacy may not be as valuable to you as it is to others.

      --
      Time is what keeps everything from happening all at once.
    6. Re:real open source by Maritz · · Score: 1

      Cue a bunch of posts from PHBs telling you they won't hire you because you're a dropout in 3, 2, 1... ;)

      --
      I do not want your cheap brainburning drugs. They are useless for work. And I am a working man today.
  3. Verizon Only... by BulletMagnet · · Score: 2

    Wonder what that final number would have been had they released it across all carriers and not just Verizon....

    1. Re:Verizon Only... by Anonymous Coward · · Score: 2, Interesting

      It's not Verizon only. Their advertising is very misleading. I do wonder, though, if they would have sold more if fewer people were mislead about that.

  4. Courage by Anonymous Coward · · Score: 0

    LOL Apple's $180 wireless earpods!

    SCENE: A bar. 10 years from now.

    DRUNK: Can you believe I used to be the CEO of a major technology company? Look at me now!

    BARTENDER: What sunk you? Courage?

    DRUNK: Nah. We got greedy. Real Greedy.

  5. Hmmm... by Actually,+I+do+RTFA · · Score: 3, Interesting

    Seems a bit early to speculate. Tons of preorders may be good, or may cause the whole thing to disappear if it fails to live up to expectations.

    --
    Your ad here. Ask me how!
  6. I want to be Monitored by Anonymous Coward · · Score: 0

    I want to be monitored, tracked, and analyzed. The Google Pixel tracks how I sleep, when I wake up, who emails me, who I email, all of my calls, keeps tabs on where I go during the day, and records all of the websites I visit (on BOTH client side and server side). They do this for FREE after I pay for the cost of the Pixel device. It's a tremendous deal. The Google Pixel will be a huge seller for people who like to be monitored.

  7. Does that mean they fill fix the bluetooth issues? by sonstone · · Score: 1

    Hopefully with those numbers they can fix the bluetooth problems. Sigh...

  8. Re:Microsoft smartphone business by hackwrench · · Score: 1

    Microsoft may have left the smartphone hardware business, but as far as I know, they are still in it for the OS business. https://www.bing.com/search?q=...

  9. Re:And apparently you're wrong on hardware, too by hackwrench · · Score: 1

    http://technsafe.com/2016/11/2...

  10. Pixel half as profitable by Anonymous Coward · · Score: 0

    My rudimentary accounting understanding raises a question: given that the Pixel is dollar-for-dollar price the same as the equivalent iPhone, how do they get to be half as profitable? More expensive BOM? Less efficient supply chain?

  11. Movie tie-in with Pixels 2 by Anonymous Coward · · Score: 0

    Starring an even MORE tired-looking Adam Sandler

    He uses his Pixel to order Subway only to find the arcade machine in the corner of the shop has come to life

  12. So there is a premium Android market... by EndlessNameless · · Score: 1

    I don't consider Samsung phones "premium" because their UI is a downgrade from stock Android, and their innovation mostly consists of useless hardware gimmicks.

    Looks good, just not $800 good---which is what I say about most premium products.

    --

    ---
    According to the latest ruleset, this post should be modded as Vorpal Flamebait +5.
  13. Real question by slapout · · Score: 1

    Does it have a headset jack?

    --
    Coder's Stone: The programming language quick ref for iPad
  14. Who are all these people paying more than $1/day? by Anonymous Coward · · Score: 0

    You got anything more than anecdotal evidence to support your assumption?

    1 lb coffee = $6.00
    1 lb coffee = 48 6oz cups

    $6/48 = $0.125/cup

    I drink one cup before I leave the house. I drink two to three cups at work, but my employer pays for that, anyway. A few people I know do frequent Starbucks/Dunkin/Wawa/etc on a daily basis, but very, very far from most.

    And who are these people that are still buying newspapers?