Motorola: M is for Mediocrity
David is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
September is shaping up to be a big month for mobile technology announcements. Apple (NASDAQ: AAPL) has an announcement at which we expect the launch of a new iPhone and potentially a smaller iPad. Nokia (NYSE: NOK) has an event at which they will unveil the first Windows Phone 8 smartphones. Amazon is holding a press conference to launch the second generation Kindle Fire, and there is the potential for a larger version of the Fire as well as an Amazon smartphone. Samsung has just launched the successor to their Galaxy Note, the Galaxy Note II. Even Motorola has a launch event scheduled for September 5th, which will compete for coverage with Nokia’s launch event, also scheduled for September 5th.
The new gadget that Motorola, now a wholly owned subsidiary of Google (NASDAQ: GOOG), will launch has almost completely leaked out. According to the leak first reported on in Engadget, Motorola will be launching the successor to their Droid Razr smartphone, which will be called the Motorola Droid Razr M 4G LTE. Ridiculous name aside (maybe it’s a working title… but probably not), the Motorola Droid Razr M 4G LTE will have a 1.5Ghz dual-core processor, 1GB of RAM, 8GB of internal storage, a front facing and rearing facing camera and come with global roaming abilities. Motorola will ship the Razr M with Android 4.0 Ice Cream Sandwich, not the just released Android 4.1 Jelly Bean, though the Razr M should get updated fairly quickly as Motorola is part of Google. The screen is 4.3 inches and has a resolution of 960 by 540; though this is not a bad screen, it is not 1080p or even 720p.
Motorola has another rumored phone launching soon with a higher resolution screen known as the Droid Razr HD. There are still a few details that we do not know about the Razr M such as the battery, which is crucial, the actual ship date and the price. With the Droid branding, the new Motorola phone is definitely headed to Verizon (NYSE: VZ). However, with the global roaming built in, it’s possible that with some re-engineering this phone could jump to AT&T, probably under the Atrix brand.
The Droid Razr and the Droid Razr Maxx brought back the Razr brand with great success; there was a report a few months back that at one time the Razr Maxx was outselling the iPhone on Verizon. However Motorola’s success has been limited to Verizon; their offerings on AT&T and internationally are pitiful. It is because of such limited success that Motorola lost $233 million last quarter. If Motorola is to turn their smartphone division around they will need more than a new Verizon Droid smartphone. The Motorola Droid Razr M 4G LTEs specs aren’t bad; sure quad-core and 2GB of RAM would have been nice, but the Motorola Droid Razr M 4G LTE is on par with other Android phones from Verizon.
If Google is serious about running Motorola as a separate company within Google in an effort to avoid playing favorites with Android partners then Motorola needs to save themselves. The Motorola Droid Razr M 4G LTE is not going to save them, however the Razr brand might. For Google experience phones, Google has the Nexus brand, and Motorola has never made a Google experience phone, but Motorola doesn’t need Nexus to succeed. Motorola sold over 130 million of the original Razr phones and Razr still has huge brand recognition. If Motorola made a few changes, like unlocking boot loaders, toning down their custom Android skin, Motoblur, and rolling out a unified set of three Razr devices that they update yearly (similar to what Samsung does with the Galaxy line and Apple does with the iPhone), Motorola could turn it around.
This brand unity and device simplification is the best strategy for Motorola, Motorola’s customers and the carriers. Motorola is not only being pushed aside by Apple and Samsung but also by HTC with their One series of devices and Nokia with their line of Lumia Windows Phone smartphones. Customers need to associate a brand across carriers and countries with a handset maker if their devices are going to be successful. Motorola currently has about 12% of the US mobile market and that number is far lower internationally and dropping. Motorola is not the only smartphone maker being hurt by not having a strong brand. HTC tried to roll out the One series as a brand for all of their high end Android smartphones on all carriers, but carriers re-branded them and Verizon doesn’t carry the One series. This has resulted in several quarters of declining market share for HTC.
Apple will announce a new iPhone this month, Samsung just announced the Galaxy Note II, Nokia will have the next iteration of their Lumia phones launching and HTC will continue to try to turn around their One series. This leaves Motorola somewhat out in the cold as they continue to release decent phones, even good phones, which lack any unity across carriers and countries. The Motorola Droid Razr M 4G LTE will be a mediocre success in the smartphone world; perhaps that is what the M stands for.
ded004 has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Google. Motley Fool newsletter services recommend Apple, Google, and Nokia. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.