Google's competition with Apple has always been asymmetric because that other California company has been able to control and fine-tune both the hardware and the operating system of its world-conquering iPhones and iPads.
The Android alternative, as good as Google might try to make it, just can't match the iPhone's level of polish, coherence, and refinement, because the devices running it are out of Google’s hands. Today, Google is going to grasp that thorny issue by investing itself fully into the business of being a phone maker as well as software provider.
The full cachet of the Google brand will be leveraged for a marketing campaign built around "made by Google" and "phone by Google" messages. It is shaping up to be an abandonment of the Nexus program, which was practically a hobby inside Google HQ, in favor of what looks like a more serious and integrated approach to Google's long-term mobile strategy.
Judging by the event, the first and most prominent benefit of Google’s hardware-plus-software approach will be its Daydream virtual reality platform — which is likely to be best experienced on the upcoming Google Pixel and Pixel XL phones.
What Google is aiming to do today is to become the world's second Apple. By controlling the hardware on which Android runs, Google can emulate Apple's leading example by synchronizing its software and hardware improvements — so that they complement and support one another — and it can also offer up a reliable platform for developers to build on.
Consider how nascent Google Daydream is, and consider also the consequently high level of risk for any serious developer to invest time and effort into developing for it. An iPhone-like tier of Google-certified premium Android smartphones — with VR made integral to the OS — provides at least some reassurance and risk mitigation for prospective Android VR devs. That anti-fragmentation concern is evident in Google’s choice of closely matched, almost identical specs between the 5-inch Pixel and 5.5-inch Pixel XL.
To compete in the mobile world without control of the hardware your software runs on is tantamount to playing a lottery. One day Samsung will thrill everyone with its excellent hardware design and class-leading cameras; the next day it will throw you into depression with its exploding batteries. Google tried doing things that way: most of Android's history up to this point has been a narrative of negotiated mutually beneficial hardware and software development between Google and its Android partners.
However, the synergy that Google's able to obtain with self-interested hardware manufacturers is a suboptimal compromise. The interests of the Mountain View company and its partners are as likely to clash as they are to align, leading to such frictions as Google’s spat with Samsung over the latter’s excessive customizations of Android. This summer it was revealed that Google has begun a naughty list of partner companies with the intent of shaming them into doing what Google thinks is right (like more timely security patches and software updates).
After witnessing Android's uneven progress through the years, and trying to nudge it straight through the Nexus program and a variety of behind-the-scenes maneuvers, Google looks set to today return to the classic approach of "if you want something done right, do it yourself."