MOTOROLA MOBILITY PREPARES TO UNVEIL ITS FIRST FLAGSHIP SMARTPHONE SINCE BEING ACQUIRED BY GOOGLE INC
Google is expected to allow its Motorola hardware unit to spend several hundred million dollars—and possibly upward of $ 500 million—to market the highly ...
Google is expected to allow its Motorola hardware unit to spend several hundred million dollars—and possibly upward of $ 500 million—to market the highly-anticipated device in the U.S. and some overseas markets, including Africa.
The moves could have broad implications across the mobile industry.
The price of the Moto X is expected to be comparable to its competitors, which include Apple Inc.’s iPhone 5, Samsung Electronics Co.’s Galaxy S4, and HTC Corp.’s One,
Motorola Chief Executive, Dennis Woodside implied in recent public statements that prices for its devices would go down substantially over time, as the company won’t be as concerned about inflating profit margins as its competitors. He also said the device would be “broadly distributed” but didn’t elaborate.
In its first ad for the Moto X that ran earlier this month, Motorola played up the fact that it will largely be assembled in the U.S., a slap at Apple, whose devices are built in China.
Motorola’s moves, including the expected unveiling of the Moto X later this summer, are being watched closely by the mobile industry. Mobile executives say privately that, component suppliers such as microchip and sensor makers as well as wireless carriers hope Motorola or other hardware manufacturers can break the dominance of Samsung and Apple, which over the past four quarters accounted for half of the 770 million smartphones shipped world-wide, according to research firm IDC, and an even greater percentage of tablet shipments. Nearly a billion smartphones are expected to be shipped in total this year, the firm said.
Motorola sold about 2.3 million smartphones in the first quarter of this year, or 1% of the global market, IDC said.
“The industry is certainly rooting for Motorola as well as the other [manufacturers] to be successful” and break up the “duopoly” of Samsung and Apple, said Rajeev Chand, a managing director at boutique investment bank Rutberg & Co.People who have seen the Moto X, or were briefed about it, say that Motorola has high hopes the device can gain share in the crowded market. But they cautioned that flagship devices don’t always catch fire right away and expectations for future generations of the device would be much higher. For instance, it was Samsung’s Galaxy S3 smartphone—the third generation of its hero device—that propelled the brand to a point where it outsold the iPhone for a time, according to some analysts.