Five reasons why it may be Motorola Mobility's time

Five reasons why it may be Motorola Mobility's time

Summary: Amid the hubbub over Verizon's iPhone and the war with AT&T one of the biggest winners not named Apple may be Motorola Mobility.

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Amid the hubbub over Verizon's iPhone and the war with AT&T one of the biggest winners not named Apple may be Motorola Mobility.

Motorola Mobility entered 2011 with significant questions. CEO Sanjay Jha had to diversify, innovate and now has to battle for shelf space at Verizon. What a difference two weeks makes. The cards have mostly broken Motorola's way.

The more I think about Motorola Mobility's prospects the more bullish I become. Note I'm not predicting that Motorola Mobility is going to be a profit juggernaut---it still plays in a rough hardware neighborhood and has some serious earnings risk as Verizon starts pushing iPhones. But from a product and strategic perspective Motorola Mobility is well positioned. At the very least, Motorola Mobility is setting itself up as a nice takeover target.

Here are five reasons I'm upbeat on Motorola Mobility's prospects:

  1. The Verizon iPhone is 3G. Motorola Mobility---along with Samsung and HTC---will be at the forefront of 4G services at Verizon. Motorola will have the Bionic (right). That's going to count for something in the marketplace, especially for customers like me who want a future proof (for two years at least) network. Motorola Mobility still has a lot to lose as the iPhone arrives at Verizon, but it's positioning is better than a rival like Research in Motion. Related: Verizon iPhone, LTE Androids: Dark Clouds Ahead for RIM's BlackBerry?
  2. Motorola's Atrix can change the smartphone conversation. Now the concept behind the Atrix---a smartphone that can be plugged into a laptop shell---isn't unique. Palm tried it a few years ago, but scrapped plans because the processing power just wasn't there. Now smartphones are getting dual core chips and the conversation changes. That phone isn't a network in your pocket---it's a CPU. Jason Hiner has the overview of Atrix. After a bunch of demos at CES, Hiner is convinced that Atrix is a game changer.
  3. Motorola Mobility has diversified with AT&T. Let's say this AT&T-Verizon war plays out as expected. AT&T will poach Android customers. Verizon will poach AT&T's iPhone customers. The comical reality of that Verizon and AT&T marketing war over the iPhone is that the two wireless giants just might cancel each other out. Motorola will make up some of its lost sales at Verizon with AT&T.
  4. Motorola can ride the Android rocket. Now that the dust has cleared on the Verizon iPhone rollout it's fairly clear that Android isn't going to lose market share. In fact, the Android express will keep rolling as will Apple's iOS. Both of those gains will come at the expense of Research in Motion. Kaufman Bros. analyst Shaw Wu said Android is getting its first big test. He said:

    Our checks with industry sources indicate that Verizon will put heavy promotion behind the iPhone, likely ahead of its other platforms including Android. On its homepage, it is already highlighting the iPhone 4 and iPad as flagship products with not much else in sight (save for a Jabra Bluetooth Headset).

    As we said before, we believe iPhone on Verizon will be the first true test for Android whether its share gains are real or just a temporary phenomenon due to weak competition. While there will be a lot of focus on whether iPhone users move from AT&T to Verizon, we believe the more interesting question is how many Android users on Verizon decide to switch over to iPhone, now given a choice.

    If you think Android will hold its own (as I do) then Motorola Mobility is a clear winner.

  5. The Xoom tablet looks promising. Let's face it: Apple has the tablet field to itself with the iPad. Android tablets have been disappointing thus far. And the field at the Consumer Electronics Show was hyped way too much. One bright spot was Motorola Mobility's Xoom tablet. This tablet will be among the first with Google's Honeycomb Android OS and has a puncher's chance of making inroads. Simply put, Xoom's arrival in March can give it an early mover advantage in the Android tablet market. Related: Motorola Xoom (hands-on photos), Video: Google quietly unveils Android 3.0 'Honeycomb'

Topics: Verizon, Android, Google, Hardware, Laptops, Mobility, Tablets, Wi-Fi

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48 comments
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  • motorola is dead

    well at least motorola mobility. i think it is safe to say that they have no chance of breaking even anytime soon.

    so what are your arguments larry?

    1. hoping that iphone on verizon won't cannibalize android sales? that's more than delusional. they will be cannibalized by the millions from day one.

    2. offering another pos android device with the bionic sometime in the future (among all the other undistinguishable android devices from htc, samsung, sony ericsson)? what a strategy!

    3. the atrix? you gotta be kidding. why would anyone want to slap your phone into a dockingstation or schlepp an empty laptop shell with you, just to have a web browser on a bigger screen? doa.

    4. and then there is the xoom! a tablet probably costing more than the ipad with the ipad2 arriving around the same time. a tablet without the ecosystem or the distribution power of apple? i guess they will sell a few to apple hating geeks, the rest will just scratch their heads with the question: why should i buy a lame copy of the ipad?

    so there you have it. 4 reasons why it is definitely not motorola mobilty's time.
    banned from zdnet
    • RE: Five reasons why it may be Motorola Mobility's time

      @banned from zdnet Nice counter view and dueling banjos. I think you overestimate the Android cannibalization issue. Remember AT&T will start pushing Android devices as Verizon pushes iPhone. If anything they are just reversing roles.
      Larry Dignan
      • Wouldn't that make cannibalization even worse?

        @Larry Dignan

        As AT&T will offer their variations, different then Verizon's?
        John Zern
      • And in the meantime - T-Mobile will be pwning them both.

        @Larry Dignan
        Their MyTouch 4G ads put the iPhone in it's place. Search YouTube for T-Mobile commerical and Glitchy... Funny stuff.
        Wolfie2K3
      • RE: Five reasons why it may be Motorola Mobility's time

        @Larry Dignan<br><br>AT&T has 15 iPhones to every Android subscription. Do you think they'll get this ratio down to 10:1? <br><br>Android; there's no there there....<br><br>Suppose V sells 12mm iPhones, how many Androids will be cannibalized?<br><br>Suppose AT&T sells 8mm iPhones, how many more Androids will they sell?<br><br>Do the math and write a column on your target growth est for Android and iPhone 2011 on both networks.
        pk de cville
    • RE: Five reasons why it may be Motorola Mobility's time

      @banned from zdnet

      1. Yes they will sale some iphones, but millions? As a Droid user I'm pretty happy with my phone. 2 years ago I lusted for a iphone, but because I was on verizon I instead bought an HTC and now own the Droid. I've used the iphone and don't find the experience much different (except I can upgrade the memory on my droid).

      2. Future or not the lure of 4G makes me want the new phone. A phone like my droid combined with 4G speed, now that's the ticket.

      3. When I read it I thought that'd be great. Carry the smaller version around in my pocket get home or on the plane and plug it into the larger screen. Perfect.

      4. Have you seen the sales numbers for android tablets? Even the crappy HW versions are doing well. My daughter has a Nook Color with the android OS and she loves it. I own the ViewSonic G Tablet and I'm very happy with it. But when I saw the performance of the Xoom I have to say I was intrigued.

      I'd say Motorola is positioned quite well in the mobility market with these offerings. Of course they don't have a Steve Jobs at the helm to fire up the applelites, but that may a good thing in the long run. As a company Motorola does listen to their customers given the evolution of their product lines. Steve won't allow flash or even a USB port. Good luck replacing your battery if it fails.
      north of wva
      • RE: Five reasons why it may be Motorola Mobility's time

        @north of wva
        good. Another satisfied customer then
        desilvav
      • RE: Five reasons why it may be Motorola Mobility's time

        @north of wva So, how about a little wager? I bet that Verizon will sell more than 1M iPhones in the first weekend it comes out. Don't forget 1.7M iPhone 4's were sold in the first weekend it came out, and that was on the crappy AT&T network. Millions of Verizon customers (myself included) refused to buy droid crap for years, just waiting for this day. And on Feb 3 I will be ordering my white Verizon iPhone 4 32GB. I'll pay $100 more than the Verizon "$100 rebate on whatever droid you want because we have to sell them" phone I could have gotten, but that's perfectly fine with me!! It takes any specific new droid phone weeks or even months to sell 1M - and iPhone 4 did it in 2 days on AT&T, and will probably do at least 1M on Verizon the first day.
        rpsin
      • RE: Five reasons why it may be Motorola Mobility's time

        One thing to point out is that you really can't compare The Iphone to one specific android type phone. You really have to put all Android phones together in one bucket and compare that to Iphone. The power of Android is that the possibilities are so diverse and you can have so many different phone styles all carrying essentially the same OS. It's up to the user to have what they want. With the Iphone you have the Iphone. You either love the Iphone or hate the Iphone. With Android, you can love the Evo but hate the G2 or the Droid and vice versa. If you want to fairly compare the Iphone sales with Android sales, you have to compare it with the ALL the Android phones sold. Whether it is a Droid or Droid X or Evo or G2, it is still Android. Just a thought (from a loyal Android fan). I wouldn't switch from Android if they were handing out Iphones for free. The cool thing is my wife has certain things she wants in a phone such as a full qwerty flip out keyboard and I want certain things such as a better processor and upgradability yet we can still use Android and share the same apps and functionalities. If I switched to the Iphone, I would be toast. I would have no options. I just stick with what they give me and would have to just live with it.
        jbfmarketing
    • RE: Five reasons why it may be Motorola Mobility's time

      @banned from zdnet
      I would add another to your list of 4--Motorola hopelessly effed up their brand: http://merriamassociates.com/2010/07/breaking-up-the-motorola-brand/
      LDMerriam
    • RE: Five reasons why it may be Motorola Mobility's time

      @banned from zdnet<br><br>You apparently don't know what you are talking about. You need to take a real look at the facts. The operating systems are very comparable with a very small percentage of people showing much of a preference. Apple has more apps and Android is much more open and flexible. Additonally Apple is the only company behind iOS where Motorola, Acer, Asus, LG, Qualcomm, and Samsung are fully behind Android. It really comes down to the hardware. Take the Xoom for example. It has a 1280x800 (1.024 millions pixels) screen vs the Ipads 1024x768 (.786 million pixels) in 10" screens. So pixel density is 30% greater. Additionally, the 16/9 aspect ratio is far superior to the 4/3 aspect ratio. Most movies are in 16/9 (or larger) vs 4/3 so you will have black bars on the top and bottom just to view the same movie. You will essentially have a viewable image that is essentially 33% larger (black bars take up about 120 pixels of a 480p image or 480 pixels of a 1080p image) with essentially 30% higher definition. That gives it the ability to have about twice as good of video viewing experience. The Xoom comes with microsd expansion, dual cameras, better builtin sensors, usb ports, hdmi ports, full flash support, and a processor/gpu combination that runs circles around the current A4. Even if the Ipad 2 adds a usb port and cameras with a better screen it will still be inferior. They may even finally have a dual core processor that is comparable, but it will still be inferior. The Atrix is the roughly the same vs the Iphone and the next Iphone iteration is much further away. I have 7 Apple products in my house and I would still take the Motorola first and so will most consumers when they really compare the two.

      I admit that Apple has had a better phone and tablet to this point. But last week changed everything. The Xoom and Acer Iconia are both superior to the Ipad and the ASUS model is not far behind. Android Gingerbread is as good as iOS and Honeycomb is superior.
      BDA123
      • RE: Five reasons why it may be Motorola Mobility's time

        @BDA123

        Exactly!
        timspublic1
      • RE: Five reasons why it may be Motorola Mobility's time

        @BDA123
        Talk about not knowing what you are talking about!

        "The operating systems are very comparable with a very small percentage of people showing much of a preference."

        Why have data when you can make things up. If you DID bother with actual data, you would have found that 84% of respondents in a survey of Verizon customers, INCLUDING Android owners, said they would switch to the iPhone if it were available. Now it is.

        "Apple has more apps and Android is much more open and flexible."

        Oh really? Android open? Please explain to me the exact procedure by which you can download the Android source, modify, recompile, and upgrade your phone. Hint: YOU CAN'T. Please explain how you remove carrier crapware so that it is not reinstalled automatically, without rooting the phone.
        Android is open the way North Korea is open.

        "Take the Xoom for example. It has a 1280x800 (1.024 millions pixels) screen vs the Ipads 1024x768 (.786 million pixels) in 10" screens."

        You are comparing a prototype to what will soon be the previous version of a product. This makes sense to you why?

        "Additionally, the 16/9 aspect ratio is far superior to the 4/3 aspect ratio."

        And why is that exactly?

        "Most movies are in 16/9 (or larger) vs 4/3 so you will have black bars on the top and bottom just to view the same movie."

        Actually a significant number of movies are in SCOPE, NOT 16:9. And since there is far more to do on either tablet than watch movies, I fail to see any inherent superiority. In fact, for a number of UI reasons, 4:3 is the superior format at 10".
        DeusXMachina
      • RE: Five reasons why it may be Motorola Mobility's time

        @BDA123 The article talks about the RIM which controls the business market and the Iphone WILL never dominate that market. Iphone needs flash and will never be taken serious in the business market. It has the image as a toy in business.
        Orlbuckeye76
      • RE: Five reasons why it may be Motorola Mobility's time

        @ jblazsek
        I have news for you:

        The iPhone is already being taken seriously in the business world, and I hate to break it to you, it is flash that has the "image as a toy in business."
        DeusXMachina
    • RE: Five reasons why it may be Motorola Mobility's time

      @banned from zdnet lol u have to be kidding me. Android is already better than ios in terms of features and the phones have better and more capable hardware. Why would anyone want to step down to an iPhone when they can have the real deal.
      Jimster480
      • RE: Five reasons why it may be Motorola Mobility's time

        @Jimster480 dude you are the one that has to be kidding me! If you truly think Android is better than iOS you are kidding yourself and blatantly trying to show your "geek" hate for Apple products. Android OS is falling behind the likes of both Web OS (The OS is great, the hardware so far has just been limited, very) and iOS. As much fun as it is to send texts to the wrong person, because your phone decided to do that; or even send texts to numbers you've never even heard of but your phone decided to generate and send to, and even get massive viruses on your Android phone...as MUCH fun as that is, I will leave that up to all of you Android users. And what is fun about Android also is that you can't get a clean install on most Android phones, because the hardware is not made by the same company that makes the software. Man that must be "the real deal"!
        LOV3LikeRockets
      • RE: Five reasons why it may be Motorola Mobility's time

        @LOV3LikeRockets<br><br>You have got to be kidding me? You think the iPhone has a perfect record? No company gets everything right on the first try. The original Droid was basically the start of the Android push. Look how much has been accomplished in such little time? Android is not going anywhere and it will continue to improve. If you haven't seen the Honeycomb demo at CES you should watch it. <br><br>Also, look up CyanogenMod. It supports a freaking ton of phones and offers a no crapware experience. It's better than a pure version by far due to all the little enhancements provided by the developers. The power of these phones is that they aren't all the same and very flexible with what you can do with them. I would be bored to tears with an iPhone if I had to switch now.
        StupidTechZealots-23432415690276115908309621553360
      • RE: Five reasons why it may be Motorola Mobility's time

        @Jimster480

        I very much agree. The only thing iP4 EVER had over the many Android offerings was a marginally better screen.

        The rest of their hardware is outdated, it was LAST January when the Nexus One came out, now with MORE RAM, dual core processors (each running at higher speeds than the A4), larger screens...iPhone4 isn't even in the same league as current Android phones. Apple better have a BIG improvement coming or they will fall farther behind Android than they already have.

        Sorry, but the facts are the facts. You should read them before jumping in with illogical fanboy statements like these.
        timspublic1
      • RE: Five reasons why it may be Motorola Mobility's time

        @Jimster480
        I have a Droid and with each subsequent release of Android it has gotten worse. Slow, random battery drains, CPU hangups that will last forever. If that is what you call a better operating system you need to lay off the crack pipe and see what the real world is doing. Android is a work in progress and has many rough edges. Its only real strength is the google app support but even that can't make up for its unreliable operation. I'll be moving to a Verizon iPhone in less then a year.
        Kabcock