Google Pixel phones carry a high entry price. Google certainly has a potential to compete against Apple with its own branded phone. In order to do so, it has to come up with a phone that, like Apple, both the software and the hardware is controlled by the company. Until now, Google partnered with third-party manufacturers like LG and Huawei to create the hardware for their phones for its Nexus brand devices.
Google mentioned in their latest event that it needs to have full control over both the hardware and the software to deliver the experience it plans for the future, like Google Assistant and the Daydream VR platform. Although Google Pixel phones are the first to include the Google Assistant feature, we can assume that more phones will have this feature in the near future. There are also many Daydream-compatible phones that will be released to the market before Daydream launches this year. So that being said, I do believe that one of the reasons Google did it is that they believe that there is a need for their own branded device to compete against Apple. After all, all the other devices use its own branded Android operating system.
They needed to come up with their own branded device to differentiate itself from the other devices and have a strong brand saying in the mobile industry, the same as Apple. The new 'Really Blue' color is a take on the iconic white iPhone. So this new bold Blue color will be tight to the color brand, at least for the first Pixel devices. I do believe that we'll get to see it in future Pixel phones as well.
Now for the price. Both Google Pixel phones carry a pretty high price that very closely matches the Apple iPhone 7. This means that fewer people will be able to put their hands on this new device, but as we've seen with the iPhone, if the brand name catches, it can certainly penetrate market segments that would otherwise wouldn't buy a high-end device. Many people buy an iPhone for the brand name, although nowadays some Android phones offer superior features. The Google Pixel phone trumps the iPhone 7 in terms of its display size, resolution, RAM, battery capacity and camera performance (As we've seen in DxOMark tests). On the other hand, the Pixel phones don't have the same IP67 water-resistant rating as the iPhone, lacks 256GB built-in storage offering, lack the advanced 3D touch display functionality, lack stereo speakers, don't offer a 2x optical zoom dual-camera setup and lacks an optical image stabilization. The Pixel phones are also inferior in terms of performance as revealed by some early benchmark tests.
It seems to me that Google had no choice and it couldn't deliver the same experience and compete against Apple with a cheaper device because it would definitely be even more inferior in those categories where iPhone 7 wins and even lose in other categories. To compete against Apple, you need to have a high-end device that offers added functionality that the iPhone 7 lacks. The Pixel got it right to some degree, but I'm sure that there are many consumers who won't be convinced by it.
The logic says that in order for Google to acquire more market share on the account of Apple, it needs to come with a powerful device which is cheaper but with more useful and powerful features. It doesn't seem that the Pixel, for that given price can do it. The Pixel phones do have some advantages that might convince people to buy a Google phone this time, but that will be mainly due to the Daydream VR platform which the Pixel phone support, the Google Assistant feature and of course its high-quality camera.
It will be interesting how well the mobile community will react to these new phones and how it translated to sales. I think the Daydream VR platform can definitely make an impact, especially in times where VR popularity is growing rapidly and more and more people will want to get their hands on this new technology. The problem again is the high entry price tag, which will put the Pixel phones out of reach of many consumers who would have wanted to get a Google-branded phone and get into mobile VR. There might be even better offering from 3rd part manufacturers.
The decision of buying a Google branded phone isn't easy. Many consumers want to see what Apple plans for virtual reality and augmented reality and then make up their minds. Who knows, maybe Apple will come up with its new AR or VR platform that will be better than all the other offerings - only time will tell.