Dismal Q2 evidence of deeper problems at Motorola? Having seen off the challenge to his leadership from billionaire activist investor Carl Icahn, Motorola CEO Ed Zander is under renewed pressure as the company warns of a dismal second quarter and a full year of losses in the core handset unit. While the infrastructure and Connected Home divisions are faring far better, they …
'Apple to storm the market with a 2G handset with dubious video credentials that most users remain convinced is a ‘multimedia phone’ to rival the N Series.'
Where Apple is scoring, (and where other manufacturers better learn the lesson), is that the 'experience' of the iPhone is so much better than rivals. It may not have the processing capabilities of the N series, but it delivers. I've had the N90 and now the N95 and I've found both phones to be overcomplicated, and sluggish.
With the N95 they can add unreliability (mine crashed 6 times in one day using the Nokia web browser) and indifferent build quality (it's plastic) to the mix. Comparing the N range to my all too-brief play with the iPhone is not favourable - the latter is easy to use, responsive and has Apple's famous quality of finish.
As for Motorola - I've never found one of their phones easy to use. Apart from design their range has next to nothing to recommend them.
The market for an easy-to-use mobile phone is still up for grabs. Apple have shown there are alternatives to interfaces originally designed for just making voice calls, but I'm sure the iPhone isn't the be all and end all of mobile interaction design. Perhaps that's where Motorola should be putting some effort - make the Motorola range desirable not just because of styling and finish, but also for the experience of using their products.
"With the iPhone carrying all before it, Motorola CEO Ed Zander must be haunted by memories of his company’s aborted attempt to co-create a music phone with Apple two years ago, and of possible opportunities missed."
That bit makes me curious. I did buy a Motorola e680i in Singapore exactly 2 years ago and it does look a lot like, say, a dated Iphone. It runs in Linux, is an excellent MP3 player as the built-in speakers really do justice to music and it is also able to play videos in full screen (you can also call, SMS and it has a phonebook too :D). The external design is also quite Apple-esque and simple (although batteries can be swapped in this one).
I always thought the Iphone idea and looks were very similar to the Motorola e680i. Would you happen to have more info into the bit I reposted (motorola and apple collaboration)?
Regards,
Carlos
"failure to diversify the range sufficiently as the iconic RAZR comes to the end of its phase as a premium product"
This is what's been obvious from the start, but so many journalists got carried away on the hype and the sales figures that they failed to mention one-device-wonders don't do their makers much good in the long term.
No company should ever depend on one model so much, it really isn't healthy. It's the equivalent of countries that depend too much on growing coffee or cocoa, they remain poor because their income is so uncertain that they can't really plan for the future.
Phone makers are especially vulnerable if they concentrate on one model because phones are bought by such a diverse range of people, from children to the elderly, in rich countries and poor ones. Large handset manufacturers need an extremely diverse range of products in order to stay competitive.
Having extensive experience with Motorola in business, I would say that actually Ed Zander is at the heart of the issue. He allowed Garriques too much freedom to trash the profitability of the business, without having any decent products as a followup to Razr. Customers had been telling Motorola for a couple of years that their portfolio looked very weak in comparison to up and coming competition from Nokia, Sony Ericsson etc, but they took no action and were just too arrogant. That is the CEO's responsibilty.
Plus Motorola's supply chain has been weak for years. As was Ericsson's when they ran handsets. Their costs were also much too high to compete effectively. But the initial SonyEricsson team tackled that quickly, outsourcing production and drastically cutting costs so within 2 years of Sony Ericsson forming they had an excellent cost base on which to launch their drive into profitability. Ed Zander did not focus effectively on that and has paid the price where he cannot launch cost effective handsets thereby pricing Motorola out of the market.
Not listenting too customers and not focused enough on costs. Two reasons for a change at the top. On the hand, the article is right about the deep structural problems at Motorola, but focus can have brought greater progress then has been achieved to date.
Mr. Zander is not the problem at Motorola. He has made significant improvement in a cantakerous bureaucracy, while fighting off a vulture in Icahn. What's needed at Motorola is more of what Zander did in his first 12 months - and definitely not a return to the old (failing) Motorola or the draconian proposals of Icahn. Read more at www.ThePhoenixPrinciple.com
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