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Update: Google has officially acknowledged the issue, stating:

Thanks for the reports everyone. We are investigating this issue. I’ll post back here if we’d like any additional data from the community.

As others have mentioned in this conversation, you can work around this by turning your phone off and then back on again. I know that’s not ideal, but I want to be sure and mention it in case you find yourself in this state.

(I’m going to mark this post as a best answer to this question. Please don’t take that as a sign that Google considers this issue fully resolved. Rather, it’s the best way for this forum system to display an important update at the beginning of a thread, and I want to help ensure that any newcomers to this discussion see the latest update from me.)

The Nexus 6 from Motorola is meant to be Google’s flagship phone in the Nexus line at the moment, and as such, it gets a fair amount of coverage when Nexus devices are discussed. This is usually a good thing, except when there’s an issue, and there appears to be one. At present, a number of users (seemingly US based, but it doesn’t appear to be limited) are reporting mobile connectivity failures, on a number of carriers, software versions and across a number of locations.

The issue can be observed almost at random when the 3G or LTE connection fails, and the signal bars display with a ! logo imposed over the top. This seemingly occurs whether there’s Wi-Fi active or not, and whether there’s a plausible connection to the local 3G or LTE tower. Rebooting the Nexus 6 seems to fix the issue for a short while, before the issue simply comes right back. There’s no permanent fix in sight.

The problem seems to be affecting T-Mobile and Sprint network customers for the most part, though at least one XDA poster on Verizon and another in the United Kingdom say they’ve experienced the same issue.

If you’re a Nexus 6 user in Australia, please let us know if you’ve seen this issue occurring, and the circumstances in which you’ve seen it, and we’ll try and push Google for any word on a fix.

Source: RedditXDA.
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I don’t get this particular issue, but when my signal switches from 3G to 4G I get complete loss of signal rather than a ! imposed over the signal icon

I have one from the left field. My wife’s M7 just got updated to 5.0.2. Ever since, her mobile 4G coverage is rather poor. It still connects via 4G but in a lot of places where it used to connect on 4.4.4, there is no connection now. And the speed of the Vodafone 4G connection is, well, quite pathetic. So did the 5.0.2 update contain something that is affecting all phones, not just Nexus?

I have had this issue on my Nexus 6 on Vodafone. I would not get any 4G connectivity even though my phone would show me full bars in terms of signal. A reboot fixes it. I am not sure whether this would be due to the Wifi zones around as I was in the CBD and there would be loads of Wifi zones around.

Has been happening on my nexus 4. Really only noticed since 5.1 most mornings. I find if I search for carriers it comes back for the rest of the day. Seems a simple software thing just needs to try to reconnect if it trips.

Haven’t had any issues. Though I am using cyanogenmod 12.1.

This has been happening on my N5 ever since updating to Lollipop, leaving it fixed to 3G seems to solve the problem but I miss out on 4G speeds 🙁
I thought it was a problem with Telstra.

Yep, I’ve been getting the same issue on my Nexus 5 since the update to Lollipop. I’m guessing it’s an issue Android 5.1 rather than the hardware.

Yes, that’s happen on my nexus 6 as well.

This appears to be an Android Issue, not a N6 Issue. Happening to me on my N4 after the lollipop upgrade. Has been better with subsequent upgrades, but still occurring.

I’ll second that, but replace N4 with N5

Yes happening to me N5 since 5.01 update. Drops to the exclamation mark on a weakening of signal say getting in a lift and stays that way until I turn off mobile data and back on again or reboot.

Is a problem with 5.01 on for me not a specific N6 issue from my experience.

Same, happening on my Nexus 5 on 5.0.1 and 5.1.0. In fact only yesterday, had to reboot 5+ times in <2hrs.

Same here also – Nexus 5.

Happened to me recently whilst in Circular Quay, Sydney. Had full bars of reception (I’ve tested with SignalInfo app and says the signal is 85% strength at the quay) and it just dropped out the moment I went to send a text. Had an exclamation mark and couldn’t get it to respond or detect signal until I rebooted the phone. Thought that my sim had died for a moment when it happened. I kept changing it from 3G to 4G and it had no effect until I rebooted. I’m with Optus. My friend who was with me who has a… Read more »

As per my other post yes happens to me and also on Optus and N5, my N4 no issue on Telstra but that still has the black screen non response till reboot problem that started with 5.0.
As much as I like lollipop it is bug city and does the Android name no favor.

I actually DO have this problem with my Nexus 6 but it usually only happens for 10 seconds max and not all that often, maybe once or twice per day.

Same here. Thought it was just the telcos going down or something. I’m with Boost (Telstra).

Yeah I’m with amaysim and have this problem, sounds like a software problem.

Google really seems to have dropped the ball with Lollipop and updates to Nexus devices. I haven’t heard of other OEMs having these issues with Lollipop, and I’m running a CM 12.1 based ROM on my LG G3 without any issues.

This exact same issue has actually been happening intermittently on my Nexus 4 since the 5.1 update. A quicker fix for me has been to toggle between 3G and 2G and back to 3G and data then reconnects. A reboot also works as described above. I used to love Nexus devices but having owned the Galaxy Nexus and Nexus 4 I don’t think I’ll be purchasing another one again. I’ve had connectivity issues with every single Nexus device I’ve owned :/ My current Nexus 4 issues include the one described in this thread along with one where if I’m connected… Read more »

This has been driving me crazy, especially when traveling and I depend on WiFi for internet…but this also happens constantly at home where I can’t get a connection to the WiFi or to the network.