Google facing slowdowns with its online-only model for handset sales?

Bad news today for Google and the Nexus One as investment firm Goldman Sachs has slashed its estimate for Nexus One sales by a third. Predicting a bright and rosy future for the Nexus One, Goldman Sachs originally estimated that Google will sell 3.5 million Nexus Ones in FY2010. After a disappointing first month in which Google only sold a rumored 80,000 handsets, Goldman Sachs has lowered its 2010 estimate to a mere one million handsets which will be sold across multiple carriers including T-Mobile, Verizon Wireless, and Vodafone. Google’s FY2011 outlook will improve to two million handsets if, according to Goldman Sachs, Google rolls out second generation handset, markets it aggressively, and drops its online-only sales model. That last criteria is condemning and suggests that Google’s online-only model needs to be supplemented, if not supplanted, by brick and mortar retail sales. So peer into those magic eight balls that predict the future and let us know — is Google’s online-only sales model fatally flawed or does it just need some time to mature?

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