Motorola: Can it differentiate itself in the Droid mix?

Motorola: Can it differentiate itself in the Droid mix?

Summary: Motorola co-CEO Sanjay Jha has been fielding questions about the company's next Droid act since HTC's Incredible launched.

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Motorola co-CEO Sanjay Jha has been hearing a lot of about the "d" word---differentiation---since HTC's Incredible launched. At an investment conference, Jha was peppered with questions about how much marketing love Motorola would get from Verizon Wireless going forward.

In many respects, the questions Jha fielded were an extension from Motorola's most recent earnings conference call. Ever since the HTC Incredible launched on Verizon, analysts and investors have been wondering about Motorola's next act. What can it do to differentiate itself in the Droid franchise?

There's a good big of hubbub about two new Motorola devices coming to Verizon soon. Jha didn't dispute an analyst assertion about those devices, but didn't confirm them either, according to a transcript of his talk. An analyst said Verizon let it slip that Motorola Droid devices are coming soon. Jha said "I wasn't there. I don't know what Verizon said, but I certainly will participate in the Droid franchise."

The bigger picture here is that Motorola has a lot of Verizon Wireless marketing support at stake. If Verizon Wireless loves your device it can single-handedly carry a device maker. There are multiple examples of this effect. Motorola is a fine example. Its Droid handset---along with Verizon Wireless marketing---made Motorola relevant again. The other end of the equation: When the Palm's Pre bombed at Verizon Wireless the company fell into a death spiral before HP bought it.

Meanwhile, Motorola's mobile device unit, run by Jha, will become in independent company. Jha has to show Motorola's mobile unit has a sustainable product pipeline with the profits to match.

Also: Top 10 smartphones of 2010 ... for now

Jha's first message at a Barclays Capital conference was that Motorola wasn't panicking. The company is familiar with the latest from HTC and has fielded these questions before.

Jha said:

I think we are very well-positioned. I think we will participate in the Droid franchise well. We will introduce new Droid products in the Verizon franchise. I think this is probably the HTC Redux for me because when Nexus One came out, everyone thought Motorola was dead, and we survived. I think it's possible that we will survive again. I actually think the quality of devices that we are producing, I'm excited about. I think that they are competitive and some of them are actually probably better than competitors.

Jha was also asked about whether Android was a help or a hindrance. Sure, Android is a hot mobile operating system, but handset makers are increasingly using it. Jha said its Motoblur service, which now has 1 million subscribers, was a differentiator. Jha also said Motorola would be aggressive in moving to the latest Android releases.

He said:

You've got to be precise. So 2.0 which is what Droid was, 2.0 to 2.1 I didn't think there was a big change. 2.1 to 2.2, which was announced at Google I/O, I think there are some pretty important things there. But you'll see us being very aggressive in introducing 2.2 product. After that, as I understand it, I think Google will decide. But I think there's a 3.0 or a 2.5. I think that will be a fairly big rev. So 2.0 to 2.1 wasn't a big thing. 2.2 I think you will see we will introduce flash, which I think is very important for Internet. Some don't, I understand...I think if you could play flash 10.1, you could render 98% of the content of the web. That's why it's important I think.

However, HTC also plans to ramp the latest Android quickly too. Motorola also said the device hardware is what wins over consumers.

I would say that OS alone is not what consumers choose a phone on. In the United States, between 30% and 40% of the decision is in the feel and look of the device. In Korea, in China, in Asia, in Latin America, that number is close to about 60% of the decision is made on the feel and look of the device. So OS is important; OS has become meaningfully more important. Of course, Android is getting more traction as an OS. Having participated in that ecosystem, I think being one of the better practitioners of that ecosystem puts us in a good place.

That said Motoblur is the company's hedge against Android. Motorola has to diversify from the Droid franchise or it's completely dependent on Verizon's marketing. Of course, Motorola is expected to have the Droid II in the pipeline for July---something that Jha sort of confirmed. But the big question came down to differentiation again. If Motorola's mobile device unit is going to make money it has to be differentiated against rivals like HTC. What will Motorola bring to the party?

I think making money and breakeven, good execution can get you there, but in the long term I think differentiation is going to be important. I am very focused on that. I think, if you look at the way we are trying to restructure this company and heading towards a much more software-centric company, much more services-centric company, the investment we are making in MOTOBLUR now, application stuff, I think, in 2011, we will be differentiated.

But this is an extremely competitive marketplace. As you know, I, in my previous life, have worked with nearly all of my competition in one form or another. I have good understanding of their capability, what they do well, what they don't do well. I feel comfortable that we can differentiate ourselves in this marketplace, I really do...Anyone can make any company breakeven on a given day. The question is how to do that in such a way that that lays the foundation for growth for us in the future.

Related: Top 10 ways the HTC Droid Incredible killed my iPhone envy

Topics: Mobility, Android, Google, Operating Systems, Software

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23 comments
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  • WM didn't need to be diversified

    Take all the laptops and desktop computers that are currently being made with Windows. What is on the screen is the same, no matter which brand you use. The difference is what the company has to offer. Additional software, support, and durability.

    Now take this to the Mobile phone level under Android. Android, like the Full version of Linux allows customization of the interface. A desktop can run different distrobutions like GNOME and KDE, the Cell phones run Google, Sense UI, and MotoBlur, but you cannot change the interface easily as a desktop computer.

    So what do people look for in mobile phones, reliability & durability of the hardware, and the initial interface / features the company offers. The last choice which is now a factor is cell service. So, how can Motorola stand taller then HTC? Well, by quality. For once I see that their phones stand out better then HTC's with the Droid. Metal design and additional hardware acceleration that has never been seen or used before on a phone.
    Maarek
  • HTC has Motorola has NOT

    Examples are:<br><br> - Evo,<br> - Incredible, <br> - N1,<br> - Desire,<br> - Lenged<br><br>Motorola:<br><br> - Droid<br> - Back Flop.. sorry Flip<br> - Cliq <br><br>Motorola's motoblur is too far behind HTCs Sense UI.
    Uralbas
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    Motorola has already differentiated itself -- in a bad way. What do you mean you can't accept calendar items from corporate email? No more Motorola Droids in my fleet!
    AllesK
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @AllesK
      That's not a Motorola problem - it's a Google problem. You can't expect Motorola to fix gaps in Android on Google-experience phones (those are the terms of the licensing agreement that Google enforces). Google fixes this issue in Android 2.2:

      http://code.google.com/p/android/issues/detail?id=4601
      PW123987
    • Not sure what you mean? My corporate calendar works fine.

      @AllesK ?!?!?!?!?
      cornpie
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    My friend just got the Incredible and I have played with a bit. I still like my Moto Droid much better.
    kvolkan
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @kvolkan

      Of course we won't mention that the Incredible screen is half again bigger, and that the device is much faster.,
      A. Noid
      • Stop the madness. Get off the crack!

        @A. Noid
        According to Verizon:

        Motorola Droid screen: 3.7 inches 480x854 resolution
        Droid incredible: 3.7 inch 480x800 resolution.

        Please explain to me how the Incredible screen is "half again bigger". Have you actually used either one? Do you work for HTC?
        cornpie
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    Give me a Droid 2 with a 5 row keyboard, 4" or more screen, 1Ghz or more CPU, and a good camera. That's all i want, and all i'll need for the next year or 2.
    Vahidm
  • but what is the weakeness of HTC.

    Is in the software update. The motto of HTC is to "do you want a new OS, then purchase a new model". And For example, there are a little chance that Hero, Eris and Legend support Froyo and if happens then it will take "some time" to roll the update.


    And i am not blaming HTC Sense UI, HTC has been so erratic with the drivers and update since the era of the pocketpc.
    magallanes
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @magallanes

      Wow... not true at all. Maybe a long time ago. They do come out with updates. I have had an Official one from HTC for mine, and there are tons of updates on XDA. Even my Cingular 2125 had an update, and that's an old one.
      A. Noid
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @magallanes
      F.y.i. Froyo has already been ported to the Dream and Magic as recently as Wednesday. G1 next, any more excuses?
      worldbfree4me
      • RE: Motorola: Can it differentiate itself in the Droid mix?

        @worldbfree4me
        XDA ports or any others that are not official updates from the manufacturer don't count folks. If it voids your warranty or exposes you to risk of a failed update, it's in the realm of "hack" and not "update". I'm not saying you can't do it, but don't pretend that some download from XDA is the same as a manufacturer-supported update path.
        PW123987
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    Motorola knows exactly what it needs to do to differentiate the Droid--make it usable for business! There is no way that Motorola execs and sales people using other PDA's can be happy with the Droid at this point. I dumped my Verizon Blackberry for the Droid and the "knowledgeable" Verizon salesperson neglected to mention the following shortcomings of the phone:

    1. No support for Outlook contact syncing
    2. No support for .ical calendar events so you can't even add an event or meeting to your calendar
    3. Poor email push notifications from IMAP and POP accounts (other than Gmail)
    4. No ability to sort contacts by Last Name (go figure)
    5. No ability to change the default font size on the phone, or even to be able to zoom in on an email. Thousands of users older than 40 are sick of breaking out their reading glasses to.
    tlesher
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @tlesher
      Again these are Google's rules of engagement when branding a device as "Google-experience". Motorola couldn't have resolved those issues in Droid if they wanted to while still keeping it Google-experience.

      On the other hand, they have MotoBLUR. If you wanted those things fixed, you could get a CLIQ or a Backflip, as BLUR does address all the problems with exchange/pop email very well. So does Android 2.2, which will be coming to Droid hopefully soon.

      In short, chill out.
      PW123987
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @tlesher
      Try gSyncit (www.daveswebste.com) to address the Outlook sync problems.
      bertoligjunk@...
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    The big differentiator is that motorola droid has a physical keyboard. Many many people out there want a physical keyboard. So until something in the caliber of incredible gets a physical keyboard that is a big deal for motorola.
    rengek
    • RE: Motorola: Can it differentiate itself in the Droid mix?

      @rengek That's what I thought before I tried them both (switching from Treo 700p). MOT keyboard is nothing great at all. Incredible's touch only was actually easier to use.
      P.S. Incredible can do everything MOT Droid can, just 2x as faster.
      galbmill@...
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    I have a droid and think it's awesome. That's what counts for me.
    engsoft
  • RE: Motorola: Can it differentiate itself in the Droid mix?

    Do you think the USA market is enough to carry Motorola in a Global sales battle? I think not. And reading the Motorola Europe Facebook page and thier own Motorola Milestone (the rest of world version of Droid) support forum they are currently bombing and going down in customer satisfaction and market share by the hour. Good luck Mr Jha
    TehPriest