Re: El Reg is starting to understand
I don't have the whole picture yet either, but it's starting to come into focus.
They actually turn a profit at $35 and it's a slamming deal and impulse buy for what it already is, so they can sell a billion of these and not get hurt. It's theirs and it's open, so it doesn't have licensing fees and/or lock out their services and Android devices like Miracast and Airplay do (*), so they get the end-user to pay for breaking that barrier. So that's 1) Get millions of people to plug this in and use it. People will watch more Youtube so... immediate profit.
Bluetooth suggests 2) cloud gaming and desktop to me. That's more cloud services, more Google Office, more new things that wouldn't work with the proprietary wireless display options. Emerging markets are about to be forced off of XP and are falling in love with cheap Android tablets and phones as a first/only; this turns that and a TV or monitor and bluetooth KB/Mouse into a proper PC. There are a lot more applications for this as well - unlimited quantity of HighDef wireless displays for a Chromebook for example make that $200 product even more appealing.
And 2 suggests 3) People are going to need more high-bandwidth low latency broadband Internet. i.e. Google Fiber.
4) It uses their WebM codec, breaking down the barriers to that as well. Getting CE manufacturers to include this in their products should be dead simple - thereby making every TV, monitor, BlueRay player a WebM player, every digital cam, web cam and video cam a WebM recorder. This eliminates that obnoxious MPEG-LA who think they own all things video.
5) There's a Motorola connection in here somewhere but I can't find it yet. They'll probably announce later that it's Moto made and has special affinity to Moto Phones in some way. Direct streaming from the camera? Dedicated cameras?
6) Google Hangouts on your HDTV should pretty much close the deal for Google+, winning social.
7) It already starts at the ultimate limit 1080p: a faster, higher resolution device is not possible or needed until we get to higher resolutions on our mainstream HDTVs so any competing device is going to have quite the challenge beating it. There is no premium feature to make a superior competitor with, and 1080p+HDMI has a wide acceptance and a vast installed base. Introducing a competitor on price against an established $35 device is sheer suicide. Perfect timing to run away with the whole market.
(*) Yes, Android 4.2 can support Miracast. There are other issues here which are quite complex - particularly the point-to-point nature and the H.264 requirement, and legacy device incompatibilities. This is not a formal paper on the subject.
There is a lot more. But that's already a lot of freight to carry for a 2-day old $35 device.