Nexus One prices drop amid reports of slow sales

Sales of the Nexus One have been diappointing

The primary carrier for Google's Nexus One smartphone has slashed its upgrade prices as analysts foresee a tepid response to the handset.

T-Mobile has confirmed multiple media reports in saying that it has lowered the price it will be charging users in the US to upgrade their current handsets to the new Google Android phone.

The company will lower the upgrade cost for users with a current T-Mobile data plan from $379 (£232) to $279 (£170). Customers who already paid the $379 price will be given a $100 refund.

New users will still need to pay $180 (£110) for the device with a T-Mobile contract or $530 (£324) for an unlocked handset.

The news comes as one analyst firm estimated low sales for the device in its first week of availability. Research firm Flurry suggested that in its first week on the market, Google's eagerly anticipated smartphone had sold a mere 20,000 units.

By contrast, UK carrier Vodaphone estimated that it sold at least 50,000 iPhone units on its first day of sales in the UK, while Flurry pegged the Motorola Droid's opening week sales at 250,000.

"Potentially due to the heightened 'promise' created by early buzz, the handset has ultimately fallen short on sales expectations," wrote Flurry vice president of marketing Peter Farago in a blog post.

"Without the 'wow factor' now expected with each new challenger to the iPhone, especially the first smartphone with Google's own branding, demand generation has been modest."