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How Deeply Could Google Pixel Eat into Apple’s iPhone Sales?

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Google Pixel runs away with holiday activations

Will Alphabet (GOOGL) give (AAPL) cause more trouble in the smartphone market? A look at weekend holiday smartphone activations shows that Apple could have a reason to worry about its iPhone business.

Data from analytics firm Localytics show that Alphabet’s Google Pixel device saw far stronger activation during the Thanksgiving weekend. Pixel activations rose 112%, as compared to the average number of activations in the four days immediately before the weekend. But iPhone 7 only saw a 13% uptick in activations.

Localytics analyzes data from more than 2.7 billion mobile devices worldwide, and the report that Pixel beat iPhone 7 over Thanksgiving seems to give credence to views that Pixel is a great product that could make waves for Apple and Samsung (SSNLF) in smartphone vendor market.

Localytics data also show that activations of Galaxy S7 from Samsung rose 36%.

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The iPhone 7 slower than older siblings

Older iPhones have fared better than iPhone 7 on Thanksgiving weekend. For instance, iPhone 6S and iPhone 6S Plus activations during last year’s Black Friday weekend rose 36% and 29%, respectively.

Perhaps the timing of Pixel’s release supported its strong adoption during Black Friday 2016, while the reason iPhone 7 saw such a soft uptake could be that consumers who wanted the device had already gone for it after the iPhone 7 launch in September.

Still, Pixel could rattle the iPhone 7 going forward, because Google has so far only inked a reseller deal with one national wireless carrier—Verizon (VZ). Analysts argue that Google could drive faster Pixel adoption if it expands its carrier partnerships to include AT&T (T), T-Mobile (TMUS), and Sprint (S). Analysts at Morgan Stanley, in particular, are predicting that Google could ship ~3 million Pixels this quarter.

Pixel is available in two versions: a 5-inch Pixel device and a 5.5-inch Pixel XL.

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