I love all things Google, but they do have a habit of pushing things out a bit too quickly sometimes. Chrome isn't quite there, though I'm sure it soon will be.
They seem to have done the same thing with the Google phone. Their main competition is clearly the iPhone. Now the open source code used on the Google Phone will mean that creating software will be easy and quick and that new iterations can me sorted out very quickly, which is where Apple don't quite get there because they have strict controls over programming which holds them back.
The trick Google have missed is the design element of the Google Phone. It looks old and clumsy when compared to the iPhone or most other designed handsets so its going to lose out. I'm sure they'll get there but they need some some design support. It must be hard for them they're not product designers there are more dimensions than HTML to deal with.
I'm sure the software and the actual phone will be amazing but until it appears on a credible handset to complement it, it's going to struggle.