Is Google Unfairly Subsidising the Price of the LG Nexus 4?

By Gary Cutlack on at

Google and LG's imminent Nexus 4 staggered Android fans by offering high-end smartphone tech for nearly half the price we'd expect. Is that because Google's subbing LG a couple of hundred quid on each one it sells?

We may never know, but it certainly looks that way. Spanish retailer Phone House went public on the matter, claiming it's not going to sell the Nexus 4 because LG is attaching an RRP of €599 to the phone, which is rather at odds with the €299 and €349 price the unlocked 8GB and 16GB models are selling for if bought direct from Google.

This price mismatch and the possibility of Google subsiding the phones it sells directly also helps explain why O2 is asking for a huge £36 a month in return for a mobile that supposedly only costs £239.

Which raises the question... why? Why would Google want to offer the Nexus 4 so cheaply? Android's been doing extraordinary business, so why does it feel the need to subsidise sales of this year's Nexus phone to such a degree? Is there something secret in it? Are there going to be mature dating and tooth whitening adverts all over its lock screen? [TNW]