QSA, QSA: Why "Made in USA" Won't Boost Google's Nexus Q Sales

Google made tech news headlines with the recent introduction of three new products, two of which round out its new Nexus product line, a brand that puts Google squarely in the hardware business — and in Apple's crosshairs.

The slick, sleek website for Nexus seems to have that cool, clean sophistication we've come to know and love from Apple. All three of the products found there rival Apple products: the Galaxy Nexus phone, which is co-branded Google and Samsung (iPhone), Nexus 7 tablet (iPad), and the Nexus Q streaming media player (watch out, Apple TV).

But the buzz around Nexus Q has reached beyond technology alone. It has raised an intriguing issue that could be seen as either a deeper competitive strategy that pits "Made in USA" against "Made in China", or perhaps, nothing more than an expedient product solution.

We have pondered whether the fact that Nexus Q is designed and manufactured in the United States means that "the new Cold War between America and China over manufacturing will be fought by proxy brands Goggle and Apple." Apple has been criticized for manufacturing the bulk of its popular i-products in China, where its vendor, Foxconn, has been on the global hotseat.

Google, on the other hand, has sparred with China over Internet issues, a factor that likely helps its American brand status. Now it can also boast that the Nexus Q is 100 percent American-made, even though that fact was discovered by tech bloggers and not mentioned on-stage at its I/O 2012 developers conference reveal. Indeed, the Nexus 7 is made in Taiwan, not in the USA.

While "Made in USA" may create a beneficial halo for Nexus Q, it turns out that patriotism as a sales strategy was not behind the decision, according to Google, which isn't using that as part of its proposition to consumers in marketing the device.

The decision to produce the device in the U.S., according to John Lagerling, senior director of Android global partnerships for Google, was more about innovation and expediency than making a political statement. "We wanted to innovate fast," Lagerling told Reuters. "We wanted to see if we could do fast (design iterations) rather than have our engineers fly across the world. This is not this big initiative that things had to made in the USA."

Still, it may be unavoidable to make comparisons between Google's American-made Nexus Q and Apple's Chinese-manufactured products. Apple seems to be aware of the potential backlash. CEO Tim Cook talked openly at the D10 Conference in May about making improvements in Apple's management of Chinese manufacturing. In fact, he said, it is not widely known that several key components of the iPhone and iPad are manufactured in the U.S. When asked if an Apple product would ever completely be manufactured in the U.S., Cook said, "I want there to be."

That possibility is becoming less far-fetched. Chinese labor costs are on the increase and issues of quality control continue to plague American companies. Recalls of Chinese-made products certainly don't help with consumer perceptions. Today, manufacturing costs are still higher in the U.S., but U.S. companies that manufacture smaller quantities may be able to do so more reasonably in the U.S. when shipping costs are considered.

Even larger companies are re-thinking their manufacturing strategy. A survey conducted in February by Boston Consulting Group of large U.S. manufacturers indicated 37 percent were thinking about or planning to move production from China back to the United States, according to Reuters.

Maybe Google Nexus Q experience represents the next move as more manufacturers jump on the Made in USA bandwagon.