[raveli]

Great answer.

Another important point is that - just like with gaming consoles - the money is not just in the hardware unit but in the app market. This gives Google yet another advantage when compared to other Android phone providers.

But I would go as far as saying that Google has had (and will have) only a limited stock on Nexus 4 just to make sure it isn't stepping on the toes of other manufacturers in the Android ecosystem.

They've made their point with Nexus 4 to make iPhone 5 look over-priced and lacking in many features (articles claiming innovation is happening elsewhere have been appearing all the time now). They've also stolen at least some of the thunder of Nokia's new Lumia 920, which has been selling surprisingly well if the first reports are correct.

So, what it seems to me is that Google has done a brilliant move: launch a product everyone is talking about instead of iPhone 5 and the Windows phones but keep the stocks small enough so that it won't really cannibalize its partners' market.