It's that time again - rumor time. This one's from our favorite "industry sources" rumor-monger, the venerable Digitimes. They're saying that, according to industry sources, Google is making two new models of the Nexus 7 that are expected to be thinner. Sounds credible.

They're also saying these two new tablets will be priced at $199 and $99, respectively, and will hit the market by the end of 2012.

Listen, we know Digitimes is incredibly hit and miss about this kind of stuff. In fact, we frequently discount a lot of what they publish, because it's usually picture-less, often credited to no-name sources, and littered with conditional language. But these stories are low-hanging fruit, especially when the topic of discussion is anything Apple or Google.


Here's the thing - there are simply too many reasons not to believe this rumor, at least as things stand right now.

First, Google just released the Nexus 7 in July. In fact, Google just introduced the Nexus 7 last week in Japan. They haven't even finished making this thing available internationally. Launching a new version by the end of the year wouldn't make much sense. It would also make it look as though Google wasn't actually ready to make a tablet when it released the original Nexus 7. Like it was a rush job (we know it was, to some degree).

Google has stuck to what has basically been an annual release cycle for Nexus devices. If a Nexus 7 follow-up is indeed in the works, it's incredibly unlikely we'll see it by Christmas.

But what if it's just a slight refresh? This is the angle most people have been choosing to take the story from. Google won't release a new piece of hardware, per se, rather, it will simply be a slight variation on the original. This is possible, but again, doesn't seem all that likely, not at the $99 price point. Now, we have heard rumblings of a 3G-enabled Nexus 7 coming down the pipe. We've seen nothing of it since that story, though.

Would a 3G Nexus 7 make sense? Definitely. I kind of expect it at this point. But would it make sense at $199, or even $99? Probably not. Google simply wouldn't be able to make money on it. In fact, they'd probably lose a lot, enough that post-sale content purchases probably wouldn't even be able to close the gap. But what if it's carrier subsidized? Well, that'd also be pretty unlikely, as all four major US carriers have dropped the subsidized tablet model after finding it didn't do much of anything for revenue. Yes, Amazon has a deal of sorts with AT&T on the Fire HD 8.9 LTE, but the hardware itself is totally unsubsidized at $500. The only thing that's special about it is the plan.

The final argument is "OK, so what if they just made all the components cheaper? Like a lower-end Nexus 7." Let me be frank: that's a horrible idea if there ever was one. The Nexus 7 is already low-endish. It's based on NVIDIA's Kai platform (presumably), which is by its very nature designed to be cheap. I don't want a cheaper tablet than this. Unless some massive advance resulting in cost-cutting during the manufacturing process has occurred, a $99 tablet just isn't going to be very good, knowing where display and processor technology stand right now.

Is this rumor just patently false, then? I wouldn't go that far. There is a remote possibility that Google, unimpressed with sales numbers for the Nexus 7, wants to supercharge its install base during the holidays. It's the sort of crazy idea that only Google would come up with (well, maybe Microsoft, too). They'd have to make up hundreds of millions of dollars lost at the sale if a $99 Nexus 7 came to pass, though. Play Store content purchases would never be enough. How could they do it?

This is my harebrained theory on how a $99 Nexus 7 could work. First, take a page from the Amazon book: sell the lockscreen. Google has a massive ad business - they are an advertising company, after all - put text or display ads on that thing. Or, in-app ads for Gmail and Google Maps. That could make serious cash. The problem with this idea is twofold, though. First, you're ruining the stock Android experience by commercializing it. I just don't think that's a very "Google thing" to do. Second, ads on a lockscreen could just be avoided by installing a custom lockscreen or launcher. Or flashing a non-subsidized Nexus 7 ROM, thereby removing any sponsored content entirely. I just don't see it happening.

The alternative is pulling a Microsoft and bundling paid services with heavily subsidized hardware. A Google Music or TV subscription service? Again, it just seems unlikely. And I doubt a single service would be enough to make up for the lost cash. Google doesn't have an Amazon Prime or an Xbox Live Gold to rely on. In fact, Google has come to live and die on the model of free services for consumers. It wouldn't be something I could see a company like Google doing.

So, take all this stuff with a massive grain of salt (including what I say, because hey, what do I know?). We'll keep our ears to the ground, but we'll definitely be wearing our skepticism hats full-time as the holiday rumor season draws closer.

David Ruddock
David's phone is whatever is currently sitting on his desk. He is an avid writer, and enjoys playing devil's advocate in editorials, and reviewing the latest phones and gadgets. He also doesn't usually write such boring sentences.

  • http://twitter.com/dwall0 Darren Wall

    What I'd rather see is a $99 Nexus "4". In other words, a phone-sized Android device minus the phone (kind of an Android version of the iPod Touch). Yes I know, Samsung makes the Galaxy Player which is more-or-less the same thing, but it's overpriced and poorly promoted.

    • wolfkabal

      I'd be down for that as well! Been looking for older/used android phones to fill this exact gap. One for me and one for my son.

    • Frankie

      This. Maybe this is what Google is actually exploring with a $99 Nexus brand tablet. They may release a phone-less Nexus media player that has a 4-inch or larger screen. This could make more sense.

    • Robert Mahon

      Great idea. I don't think they'd be able to knock /that/ much off the price though. Still, sure it'd do well.

    • Freak4Dell

      This wouldn't be a bad idea. It'd be pretty cool if they released a phone version of it, too, at $199. I really don't think the cellular radios cost $300-400 extra like the current PMP vs. phone market is set up, so if Google could just price it properly, they'd get a ton of sales.

      • Hal Motley

        I do wonder how much baseband chips cost though, especially with all the component and patent licensing which goes with them.

        +1 on a super-fast, super-cheap smartphone running the latest stock Android though!

      • Daniel

        But to make space for the antenna would take up valuable space. Especially if it was LTE. Then you have to use a smaller, more expensive or less powerful processor

        • Freak4Dell

          That may be true, but small phones have existed before, and they (sometimes) still do exist. Motorola made an extremely compact phone. Sure, they sell it for $550, but that's not anywhere close to the real cost of the device (its $99 on contract, so unless Verizon is about to raise their ETFs to $450, I'm thinking there's some leeway in the price). Plus, the iPhone is a great size, but has top of the line specs. Estimates are that the 4S cost roughly $130 to make, and the 5 is about $160. That doesn't include R&D costs, but even with that, per unit, you're probably not looking at more than $200.

          I'd be fine with something at the $299 or even $349 price, too, like the GN. I just want something small, is all.

    • Jason Richardson

      Plus it doesn't have the most recent updates or googles envisioned nexus hardware

  • Androidium

    What really bothers me, is that by now I was expecting that we would know much more about the successor to the Gnex, and the feeling that the official announcement is imminent. I've been holding off my upgrade for quite a while now, and considering that last year at about this time it was pretty obvious what the next nexus is going to put on the table, is sort of irritating.

    • Flaime DeFeo

      We didn't know much about the GNex until it was unveiled. I think the day before unveiling we finally got a confirmation of some details and a blurrycam of it. I remember, I was looking up the latest rumors near daily for the months of Sept/Oct.

  • gordon glassick

    instead of a tablet could it be a 99 dollar nexus phone?

    • Elias

      With a tegra? Even with a 800x480 display, that would be totally freaking awesome. Smartphones for the entire world!

  • Mapplegate

    Pretty sure this will be the Nexus 5 that HTC is supposedly making for Google, to be announced this November.

  • http://thedangerbrain.com/ Alfonso Surroca

    I think a $99 Nexus tablet price point makes sense, but not until after Apple has released an 8" and/or cheaper iPad model. Basically, it would keep Apple on the defensive if immediately after reducing the entry-level price point on their tablet line, Google drops the limbo bar even further.

    See, thanks to the Nexus 7, the Kindle Fire, and the B&N Nook, $200 is about what consumers will expect to pay for a 7" tablet. I could see Google working hard to make consumers expect to pay only $100 for such a tablet by next summer, forcing companies like Apple to continue to move further downmarket (diluting their brand) or continue to be eclipsed by Android and forced to deliver stellar/one-of-a-kind features with every generation just to meet consumer expectation, something increasingly difficult for them to do.

  • RedPandaAlex

    You know, I've been thinking it would make sense for Google to launch a "Play Pass"-- a subscription service that gets you selected content in Apps, Movies, Music, etc. Essentially, combining a Spotify subscription, a Netflix subscription, and a psn-style games subscription into one product. I don't think they have the media partnerships to do this yet, but if they got those partnerships in order and bundled a two-year commitment to that with a 99-dollar tablet, I could see it being very successful.

    That's not a prediction, by the way, just thinking out loud.

  • Simon Belmont

    If I'm 100% honest, I'd love to see a 32GB Nexus 7 at $250. The Kindle Fire HD 7 has a 32GB variant for that price. I'd definitely pick one up with that capacity, at that price, even if still lacked a microSD card slot. Just my two cents.

    A $99 tablet seems too low rent right now, even for Google. I liked the idea I read above of a 4 inch PMP, a la iPod Touch, running Jelly Bean as a Nexus 4, for $99 though.

  • TheDude

    There are some manufacturers that make tablets at that price point ( the most recent i can think of is the ainol crystal with dual core and hd ips screen), so price and hardware wise, it wouldn't be impossible for google to make a good quality tablet and sell for the same price they make it. Also, it would prevent Apple, and maybe Amazon from dominating the market once again. And let's not forget about Microsoft, which would get their sales down because of people that get a 99 dollar tablet instead of a 499 laptop or a 999 ultrabook.

  • ltredbeard

    Occasionally I already have ads in Google Maps.

  • abhele

    just put 2-4gb internal and give us micro sd slot and u will sell a sh*t load

  • Hal Motley

    As much as I would like this tablet to be even cheaper that its already cheap £199 price tag for the 16GB version. ASUS really struggled to make this tablet so cheap without compromising quality.


    Having a read of Wikipedia here, suggests that the production cost would be $159 (presumably for the 8GB version) and that ASUS would really have to get guaranteed sales from these devices. As Dave mentioned above.

  • Adam Davids

    I think most are happy to pay the set price for the nexus 7 as it is now, if cheaper means less cheaper made then i think that's a mistake. Not that i believe Google will do that. I see Google improving on what is and keeping the price about the same so able to compete with the other 7 inch tablets out there, kindle HD etc. For news on the N7 consider http://www.nexus7uk.com

  • http://twitter.com/PigeonFudge PigeonFudge

    I've heard from reliable sources that it'll be $99 on Black Friday.

  • vinas03

    The $99 version will be a contract 3G nexus, nothing more.