Google unveiled its first own-brand tablet on Wednesday, and it may end up forcing Android tablet vendors to make big changes to their strategies. The new Android tablet is sleek and its price tag is attractive, but Google Android boss Andy Rubin confirmed one thing the tablet is not to All Things D on Wednesday: a profit maker.
Just as we suggested in a feature on the Nexus 7 published on Wednesday, Google will not make any money on hardware sales. Instead, the Internet giant will look to make money by promoting content sales through its Google Play marketplace, which will offer movies, music and more to Nexus 7 users, and through advertising.
“When it gets sold through the Play store,” Rubin told All Things D. “There’s no margin, it just basically gets [sold] through.”
Rubin also confirmed that Google is absorbing all marketing costs surrounding the new Nexus 7, which could end up resulting in a net loss per unit sold depending on Google’s marketing and advertising budgets.
When Rubin was asked if he thought this strategy would apply pressure to Google’s Android partners, his only reply was that “there is plenty of room left for Android tablet innovation,” All Things D wrote.