Motorola discovers cheaper phones lead to lower profits

Motorola has announced its second loss-making quarter, pushing the beleaguered manufacturer into third place behind Nokia and Samsung. Motorola made a loss of $28m this quarter, compared to a $1.38bn profit in the same period last year. Handset sales slipped 30 per cent, and income from sales of handsets dropped 40 per cent, …

[Anonymous Coward]

But it wont happen quickly

It takes 18 months to go from concept to maket. Motorola need to invest heavily in product development and product differentiation. Nokia push all the parameters not just one/two: technology, cost-effectiveness, music appeal, photo/cam appeal, fashion/design, Smartphone, etc. Nokia's recent momentum may be too much for Motorola, Samsumg and SE. Perhaps we need a merger...

[Anonymous Coward]

Profit margins aren't the same as total profits

"Motorola discovers cheaper phones lead to lower profits"

Having lower profit margins don't automatically lead to lower profits.

Supermarkets are very competitive and have tiny profit margins, but they sell products in such huge volumes that they still rake in more cash than smaller, more expensive shops with bigger margins.

[CharleyBoy]

headcount reductions?

So will they be reducing heads (nasty), or the number of times they count them?

Brings to mind an image of nursery school teachers standing over a class of toddlers.

"15?, 15! There's supposed to be 16! Who'll tell the parents?!"

[Anonymous Coward]

Down 40% in sales?

My ... they won't recover ever! Their mobile business is going to go the way Siemens Mobile went. Come to think of it they made equally boring products.

Hope Zander won't get a golden parachute. All he deserves at best is a golden shower, from the "reduced headcount"!

[Anonymous Coward]

Better phones wouldn't hurt

Motorola have always made poor phones that simply didn't work properly. We got in one of the first tri-band phones and it was utterly awful to use and even when you figured out how to make a call, it dropped the connection anyway.

They got lucky with the RAZR, which had an appalling feature set - but my wife's one had so many errors it was returned for a Nokia within two weeks. the ROKR was badly concieved, the PEBL was cute but poorly specced.

Same as Siemens mobile, same as Sony (pre Ericsson), same as LG, same as Panasonic. Samsung managed to stop the rot, maybe Moto can too....

[Anonymous Coward]

Maybe..

...Moto should stop screwing up its handhelds, that should help. Take the F3 - splendid hardware concept, great price, crappy overall implementation. What, you want to read/write SMS in a bearable manner? Why? Same with the RAZR, sweet hardware, shitty software. In contacts, people had ONE field for NAME. Maybe it was aimed at folks whose contacts are all just "Candy", "Mandy", or "Andy" anyway, but finding people with 2-part-names was difficult, especially if you were up to some fancy endeavor like synchronizing it with your PC, or, heaven forbid, Mac. This line of half-assed products goes way back to the 90s, when I had a V.3690. Marvellous phone that for some reason would not use caller ID for SMS, so you would have to teach folks to sign their transmissions. All in all, one might assume there is a special department at Moto that gets all the new handsets and then broods over how to implement at least one infuriating feature before allowing release.

[Ally]

Just don't trust 'em

I've never owned a Motorola phone, though plenty of my friends have, and they've said stuff very similar to those above me- the software is just crap.

I saw a review in the Reg recently for a multi-media type phone Motorola are releasing, which I'd be interested in, but I'm just so wary. There are so many phones out there (such as a number of semi-recent Nokia phones) that say they have an "MP3 Player" but actually have the most appaling player interfaces known to man. I want a replacement for my (brilliantly put together) Walkman phone, but I can't trust Motorola to come up with an interface that just, well, works.

[Dillon Pyron]

Some of them are good

I've had nothing but good times with my 2 1/2 year old V551. Of course, I only paid $50 for it post rebate. In the US, at least, nobody seems to push anything except the rock bottom cheapest phones. AT&T has been advertising the Crackberry some, but all the offers I've seen in the papers and in my mail have been for free phones with a two year contract. Same with Verizon. One of my co-workers couldn't even find what the newest smartphones were the Verizon was selling. He had to go into their store, where they promptly offered him a free phone, even as he stood there with his XV6700. I don't think I've ever even seen any of Nokia's high end phones here. I've never touched anything but a WM phone.

The US carriers are all about cheap. It's probably whey 3G hasn't taken off (that and lack of freqs). The Q only sells through Verizon. If Moto is going to recover, they need to develop new, unique phones for all the carriers. Apple is the only one that can get away with one product/one carrier. Maybe.

[Anonymous Coward]

Not to worry Ally!

Ally Said:

"I can't trust Motorola to come up with an interface that just, well, works."

That's OK that "...nice new multi-media phone..." (I'm guessing you're referring to the Z8 here) runs a nicely customised version of UIQ, and it just, well, works very nicely thank you :-)

--

JayGee

[Jason Irvine-Geddis]

Motorola Razr is a fantastic phone

First and foremost as a phone the Razr is hard to beat. V3 quad band, great speaker and loud and yes revolutionary looks. Yes it has is UI quirks. Re the issue with contacts - you don't need to have multiple contacts for one name just change the view in options to primary number and you can have multiple numbers under one name. Moto then brought out the V3i and V3x and then the V3xx. I currently use the V3xx (3G and HSPDA!) which is a fantastic phone and the Razr look still looks great. I have had this for almost 12 months and yet again it was ahead of its time with HSDPA

Morover for everyone moaning about the new phones what about the V8 and V9 they look amazing. Incidentally I don't work for Moto nor am I a fanboy. I have owned various Nokias including the N95 and various SEs including the W950.

The things about phones is that no single phone is perfect but Moto in my opinion is up there.

JIG