Google Inc. said it is launching a new smartphone, developed with Samsung Electronics Co., along with a new version of the Android software for mobile devices.
The Nexus S phone will be sold in mid-December through retailers such as Best Buy Co. Inc., said Andy Rubin, a Google vice president of engineering who leads the Android team. The Nexus S will be sold for $199 with a two-year T-Mobile USA contract in the U.S. It will also be sold for $529 without a service contract.
Google is shifting strategies it used with the last Google-branded phone, the Nexus One, which launched earlier this year and was sold directly to consumers through a Google Web store. Executives at wireless carriers said the Nexus One didn't sell well, though Mr. Rubin claimed more than 100,000 were sold in three months. Google closed the Web store a few months ago.
The Nexus S smartphone will feature front- and rear-facing cameras so users can make video calls, similar to Apple Inc.'s iPhone. It also includes technology that could help people make payments with their devices when they're on the go.
Google, in a blog post, said the new Android software that will power the Nexus S, known as Gingerbread, includes support for so-called near field communications technology. Such technology can enable third-party developers to create mobile payment applications.
The company also said Nexus S is the first smartphone to feature a four-inch contoured display, which is designed to fit comfortably in the palm of the hand and along the side of the user's face.
Google won't make any money from direct sales of the Nexus S, a spokesman said. Google licenses the Android software for free to hardware makers such as Samsung.
But the adoption of Android software helps ensure that Google's Internet search, maps and other services will be a mainstay on mobile devices. Google sells ads alongside its Internet search results and helps place ads within mobile-device applications such as games, and two months ago Google executives said the company was on track to generate $1 billion annually in mobile-related revenue.
Android is making significant gains in the smartphone market, claiming 23.5% of U.S. subscribers aged 13 years old and up in October, up from 17% in July, according to estimates by comScore Inc. Apple had 24.6% of U.S. subscribers in October, up from 23.8% in July, comScore said. Research In Motion Ltd, maker of the BlackBerry, continued to slip, dropping to 35.8% from 39.3% during the same period.
Write to Amir Efrati at amir.efrati@wsj.com
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