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While I did eventually return my Pixel XL it was one of my favorite phones of 2016. This phone was all about the software experience, and it delivers in that department for sure! I only returned the device because I couldn't justify the higher price tag considering that it didn't include any of the hardware features that other devices in the same price range or cheaper were able to provide. Those complaints may be solved in the next version of the Pixel which has been confirmed for later this year.
Rick Osterloh, Senior Vice President of hardware for Google, stated that the device would be coming in 2017. He also said "Their is an annual rhythm in the industry. So, you can count on us to follow it.", hinting at a late 2017 release. He also confirmed that Google would keep the new phone a "premium" device which may be a disappointment to some as that means the higher price will come along with this new device. The device is expected to include a better CPU, better camera, and likely no waterproofing although I think they would do better to include it. Wireless charging would also be a nice inclusion.
via AndroidPit