Google’s Hardware Focus Can Get It Back Into China

Google may have been banned from China as an internet search provider, but it has a new way into the market — its transformation into a hardware company.

According to a report by Seeking Alpha, Google’s transformation into a hardware and software company will enable it to reenter the China market. What’s more, Seeking Alpha thinks sales of Google’s mobile phone, home speaker and virtual reality headphones should all do well in China. The products, noted the report, will all enter China likely through the grey market. The grey market is the trade of a product through distribution channels rather than the manufacturer selling it directly. “Google Pixel mobile phones, Google Home artificial intelligence-enabled speakers, Google Daydream View virtual reality headsets — these will be the engines of Google’s revival in China. Based on what Google has so far revealed — including pricing — these products may find a large market among Chinese consumers,” wrote Seeking Alpha.

The report noted that China has a huge grey market for electronics, and Google can easily rely on that to get its products in front of Chinese consumers, both in the online and offline worlds.

Last week, Google unveiled the three new products, with its first branded smartphone getting most of the attention.The base 32GB Pixel will run consumers $620, with a $100 upgrade to 128GB possible. But that is a choice that has to be from the outset because, also like iPhones, the Pixel doesn’t have a microSD slot that makes storage easier to upgrade on the back end. The larger Pixel XL starts at $769 for 32GB and goes up to $869 for 128GB. This is something of a departure from the former Nexus model, where the phones were billed as a more affordable smartphone alternative to the dominant iPhone — though, as of the release of the Nexus 6, that has already become less the case.