There’ve been reports lately about the new Nexus One phone from Google. It appears to be a phone directly controlled by Google. Past Android phones have been produced in the traditional way, by having hardware vendors create the phones and then sell them to mobile operators. Google appears to be taking the Apple approach with the Nexus One phone.

Here’s the problem with the traditional model, and the reason Apple took a different approach with the iPhone - fragmentation.

Every Android device sold today has a different form factor. The quality of the hardware differs. The operating system version differs. Some new Android devices have recent OS releases, some don’t. Each handset maker tailors the OS to their hardware. Each mobile operator adds their own elements to the phones as well. The result is that OS updates have to come from the mobile operators. And they have been very, very slow to make those updates. Some are likely to never significantly update the phones at all.

So to sell software for the Android you have to target multiple OS versions. And there are significant functionality differences between versions. Google Navigator, the new GPS driving application from Google, won’t run on all Android handsets, because of this exact problem. In comparison, iPhone OS releases get very fast version uptake - and, as a developer, you know that users can upgrade if they need to.

Google appears to be recognizing that the traditional model doesn’t work well when you’re trying to drive innovation through software. The bulk of your new functionality will only be available to people buying handsets with the new OS releases. Hence the Nexus One.

The big question now is what their plans are for it. Is it simply a reference model? I would guess not. Are they going to sell it as an unlocked phone for $600? I would guess not again. But there my guesses end. I don’t know whether they’ll sell the model through the mobile operators, or sell them as subsidized phones outside of the mobile operator network. If they sell them through the mobile operators they’ll be emulating the iPhone. They’ll also be screwing over all of the current Android handset makers (except for HTC, who make the Nexus One for Google). But if they directly subsidize them, they’ll have to create a model for that - supported by ads or some other cost-reducing option.

At the moment, Android is just a Symbian/Windows Mobile competitor. If the Nexus One approach takes off, it could become a true iPhone competitor.