Can the Droid save Motorola?
Could Motorola's new smartphone, the Droid, be the company's next Razr a la 2010?
Judging from the hype surrounding the new smartphone, which is the first device to use the Google Android 2.0 operating system, there is a good chance the Droid could be the breakthrough device that helps Motorola rise from the ashes. But it will likely take more than a single phone to get Motorola back in the game after losing market share for nearly three years, especially as competition in the handset market intensifies.
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Gadget bloggers and device reviewers, such as our own Bonnie Cha, have been impressed with the new Droid, which was announced on Wednesday. But Motorola's mobile devices CEO Sanjay Jha said that the Droid is just the beginning. The company plans to introduce no fewer than 20 devices using the Google Android operating system in 2010, he said during the Droid launch event in New York on Wednesday.
The Droid and the Cliq, which is being sold on T-Mobile USA's network, are the first two Motorola Android phones to hit the market. But Jha said that the Google Android operating system will not only be used in high-end devices like the Droid, but it will also be used to power less expensive phones, creating a new tier of smartphone that will eventually replace the basic feature phone category.
"With these products we've taken the first step in positioning ourselves for the mobile Internet and smartphone market," Jha said during the company's third-quarter earnings conference call Thursday. "And in 2010, there will be a variety of new devices as we expand the portfolio across various tiers. We will continue to shift the mix of products to respond to the growing smartphone opportunity."
Motorola, the iconic American company that had practically invented the cell phone market, has struggled for several years now. After the runaway success of the ultra-thin Motorola Razr in 2004, the company has been unable to come up with a hit phone.
As the company's market share slipped lower and financial losses mounted, shareholders ousted then CEO Ed Zander. And Jha, an engineer who had worked his way up the ranks at mobile chipmaker Qualcomm, was brought on board to turn the business around. In addition to cutting costs, he quickly worked to get Motorola's product development teams back on track. He recently told The New York Times that the situation at Motorola was much worse than he had expected when he took the job.
He said when he arrived at Motorola he found a company with "a dysfunctional management culture" that simply didn't understand that consumer preferences had shifted. Customers no longer wanted just a phone for making phone calls. Instead, they wanted a device that could also access the Internet, give them directions, and provide text-based communications.
The Motorola Droid
(Credit: Kent German/CNET )Early on Jha scrapped the company's lineup of unprofitable phones that were using dead-end technology. In an attempt to streamline development and refocus the company's attention on creating new, cool devices, he concentrated the company's efforts almost exclusively on building phones using the Google Android operating system.
About a year after announcing this new strategy, the company introduced the Cliq and the Droid. In general, the Cliq has gotten a good reception from reviewers, but there seems to be much more enthusiasm around the Droid, a touch-screen device that some say rivals Apple's iPhone.
Some of the impressive features include Google-powered voice-activated search, a 550MHz processor, and a 3.7-inch with 480x854-pixel resolution. But what is likely to make the device a true competitor to the iPhone is the fact that it is exclusively available on the Verizon Wireless network. Verizon is the largest wireless operator in the U.S. and it has the largest coverage footprint. The company has also gotten high marks for its reliable network. And its customers are among the most loyal in the industry.
Verizon has been looking for an iPhone-killer since AT&T started its exclusive partnership with Apple. But devices, such as Research In Motion's first touch-screen phone, the BlackBerry Storm, have not met the challenge.
Verizon is expected to launch its most aggressive marketing campaign ever to promote the new device, John Stratton, executive vice president and chief marketing officer at Verizon Wireless, said at the Droid launch event in New York this week. The company has already launched a pre-advertising campaign that spoofs the iPhone. Analysts expect the device to sell well out of the gate.
"Verizon sold a million of the original BlackBerry Storms in the first nine weeks it was available," Avi Greengart, an analyst with Current Analysis, said. "And that was a buggy mess. So I expect this device will at least meet that, if not exceed it."
Motorola's Jha said during the company's earnings conference call Thursday that the company is ready for a flood of orders.
"We feel very good about our ability to meet demand for the Droid," he said. "We've spent a lot of time studying what has happened in market when successful new products have been introduced. And we've been working closely with Verizon, and we've got good access to components suppliers that we feel good about things."
Motorola's management team has successfully cut costs, which included eliminating 8,000 jobs. And on Thursday it announced its second consecutive quarter of profits after experiencing heavy losses and shrinking market share in the cell phone business for several quarters.
Success not guaranteed, analyst cautions
Wall Street analysts are encouraged by the good news.
"Directionally, things are moving the right way in terms of new devices, carrier partnerships, and narrowing losses for Motorola's Mobile Devices segment," Mark Sue, an equities analyst with RBC Capital, said in a research note.
But Sue also cautioned that Motorola's success is not guaranteed.
"It won't be a smooth ride however, with timely delivery of new smartphones, high quality, and carrier endorsements key elements of Motorola's future success," he said.
What's more, Motorola also faces tough competition in the smartphone market. This holiday season consumers will be inundated with iPhone alternatives. Research In Motion has two new BlackBerry devices on the market. And there are a slew of other Android phones that have recently been introduced.
In addition to the Motorola Cliq and Motorola Droid, there is also the Samsung Moment and the HTC Hero, both on Sprint's network. T-Mobile also has other Android devices, including the G1 and the myTouch. The Palm Pre, which went on sale in June, is yet another smartphone on the market with similar functionality.
Again, one of the good things the Droid has going for it is its affiliation with Verizon, whose executives seem pleased to reconnect with the handset maker.
"We've had a long history with Motorola," Verizon's top marketing executive, John Stratton, said at the Droid event. "And we've lived through the company's ups and downs. This is a new Motorola. We took a chance, maybe even a risk, at the early stage in the rebirth of the company, and we're delighted in what we've seen in last 12 months."
Marguerite Reardon has been a CNET News reporter since 2004, covering cell phone services, broadband, citywide Wi-Fi, the Net neutrality debate, as well as the ongoing consolidation of the phone companies. E-mail Maggie. 





Remember, unlike the Apple iPhone, Droid runs off the Google Android 2.0 OS, which is far more open than the iPhone 3.1.x OS. And Android supports Flash, which is necessary for some applications currently (though I think the need will go away once Android incorporates more HTML 5.0 support). Given the grief developers had with Apple's ham-fisted app approval policy (and Apple could end up paying for this with a potentially huge fine because of its rejection of the Google Voice app), we could see developers deciding in favor of Android, especially now that all the major cell phone manufacturers besides Apple are rolling out Android based products over the next few years.
The use of GSM over CDMA means that you can take your iPhone (or other GSM phone) almost anywhere around the world and it will work. Unlike the droid which will only work on CDMA networks. Which most countries are replacing in favour of 3G. So if you get a Droid it would be a lot harder to travel with, than an iPhone.
100% agree, no use shipping something that doesn't work properly well said :)
You need to also realize that GSM is focused more on portability than reliability, and most Americans prefer the reliability and superior coverage of a CDMA2000 network over the portability of a GSM network. I'd much rather never having to worry about whether I'm going to have 3G coverage in the US (unlike most iPhone users) and just purchase a cheap GSM phone when I go overseas.
I have no doubt there will be a GSM version coming soon. GSM does have the lions share of the world phones using it.
Are you sure about that? May want to read up on a wee limitation that the Droid has:
http://androidandme.com/2009/10/news/google-fails-to-address-app-storage-issue-with-droid-and-android-2-0/
I've been using GSM since ever and don't remember the last time I had a dropped call. To be honest, I don't remember ever having a dropped call.
Can't tell the same for US phone network, considering the ads I see, or saw, from American phone companies.
Call reliability never needed to be a seelling point in Europe. We just don't have that problem.
In the event I might travel to Europe this year, I would just get a temporary phone for the week I am there.
I think you're confusing GSM reliability with AT&T reliability. I've had little to no problems with dropped calls on T-Mobile's US GSM network--fact is, I don't think I've ever had a dropped call outside of a certain tunnel that's given me fits with ALL services I've ever been on--but my wife has had area-specific calling problems with her Verizon CDMA service. No US service provider has been perfect, but some definitely seem to be worse that others. I don't believe that the failures are due to the underlying quality of the technology that's being used, only in the inability of certain carriers to keep their networks up-to-date.
But yes I do look at my phone off and on all day, reading email, texts, viewing our corporate website and logging into the employee services to pull up PDF's of equipment manuals, making notes, filling in excel sheets for expenses, and many more things.
While i don't tell it how beautiful it is (maybe i should write it in a post it note now and then so it doesn't get a complex) the appearance of the phone can be very important.
such as:
The look of the screen and its bezel, glass or plastic film, glaringly shiny or more matte and viewable outdoors.
How the UI appears, the resolution of the display, how you interface with the phone.
Fit and finish of the device, how smooth or rounded the device edges are, whether there are covers on the earphone jack and other openings, whether the back plate is one piece or multiple pieces to cover the battery.
Button locations so you don't hit the buttons every time you go to pull your phone out of a belt case and turn on the camera or on one phone we had at work everyone was always turning on the audio recorder half the time when pulling our phones out.
Camera location so you don't touch the lenses all the time when you are holding it in landscape, or don't have to hold funny to keep you fingers out of the shot, one handed operation.
The list of visual items and construction features are every bit as important as the features such as what MP the camera is or any other feature of the phone.
Come on, the external looks of the phone may matter for the first week to first month but after that who cares. I agree that the UI needs to look good longer than that, but as for external looks, who cares. It's all about functionality people.
I don't give a DAMN what it looks like.
It could look like a big pile of steaming cow pie and I really wouldn't care...
Ok maybe that last statement is pushing it a little much.
Point is it looks sleek and smart.
Not neccesarily feng shui but look at susan boyle.
she didn't look the part but she blew the entire world away with that magnificent voice of hers.
well said.
Anyway, going back to your comment about our office, the first thing we saw were the photos of the device so we of course started dissecting the images. Things being slow right now with most companies holding off on capital projects at the moment or trying hard to hold off on scheduling their service calls until the Thanksgiving/Christmas shut down periods or until next quarter ..well..we were kinda bored.
The first thing we questioned was the keyboard. Without seeing it in person to know for sure, it appears to be split between the keys in more of a computer keyboard fashion than most cellular keyboards. For people like ourselves that spend a great deal of time at customers sites touching dirty handrails and opening dirty electrical cabinets in places like steel plants and chemical plants having a keyboard that almost asks to be a problem when it collects dirt and grime is a negative mark. Won't know until I see one in person though on that one.
Second there are several open ports around the device that do not incorporate rubber covers to keep dirt and grime out. Likewise the perforated grill on the back of the phone looks to be a grime magnet as perforated surfaces always are, especially with it on the back cover of the device to be set down on the table or other places. It is sure to collect oil and dead skin from your hand over time and since its location looks functional and not cosmetic this might lead to problems with the electronics or battery.
The back cover being a small door that looks easier to open unintentionally, is not as good as some of the newer phones that have the entire back of the phone come off as one piece that really isn't easy to take off without intending to do so. Many people here use those stick on posts that go together with a belt clip and dash mount and have had very bad experience with phones with these small covers, especially since it is dead center of the phone.
I can't remember all the comments but in the end we found more potential negatives than positives when were were discussing it.
The Razr stood out because it had a jaw-dropping design for its time, nothing else could touch it, and early adopters paid dearly for the privilege of owning/using one. People dropped their existing phones like hot potatoes and flocked to get a Razr.
The Droid OTOH is, design-wise, nothing really special. There's nothing in it really that stands out. It seems to be a worthy phone in its own right, but nothing that would make one leave (for instance) their iPhone for it.
This hardware is nice but the first HTC phone that has Android 2.0 and HTC sense is going to cut into this phones action. Or the first phone with same specs but uses the snapdragon or other faster CPU will outpace this.
The best thing this phone has going for it, it the full support of Verizon right now. Verizon has major iPhone envy so they are backing this thing pretty well.
I'm wondering if he really 'cut' them or maybe he just contracted them out to fellow Indian outsourcers. I'm asking because my own company's data center is a hunted building town now with the Indian guy put in charge of operations selling our jobs to the outsourcers. Half of the cubes are empty and the other half are occupied by the cheaper Indian 'guests'.
My questions - after all the American jobs get outsourced, who's going to buy anything in what's left of our... market? [I almost wrote 'country' or 'nation' but we all know that what he have now is a 'market'.]
That guy is working for Motorola, not India.
Apple is very particular about maintaining a certain user experience on the iPhone/iPod Touch, and has greatly improved the iTunes Store and the App Store, making it one of it's best features that you can't find on any other device.
It would be nice to listen to my Pandora App while working on my ColorSplash App or playing Chain Rxn, but it's not the most important thing to me.
The Droid smart phone, Windows Mobile killer yes, iPhone killer no, not even close.
@pgm8705: no, he's saying he can't do that on his iphone, but its not a big deal to him.
Add to that you are going to have a wide margin of difference in Android phone UI and CPU options. This is good and bad. Take for instance the two phones from Sprint. The Hero has HTC sense on top of Android and no slide out keyboard. Sense makes the Hero and great phone. At the same time Sprint has a Samsung phone with plain Android and a slide out keyboard. The reviews of the Samsung are so so because of the lack of the sense UI. Then you have different CPU options from different vendors. The biggest thing I see in Android phone reviews is lag in UI because of slow CPU's in some phones.
So I think you will have great Adroid phones and bad Android phones. However because of its app store and the Android OS, its going to kill WinMO and at some point rival the iPhone, which nothing but great IMHO.
You're right about the Microsoft thing. They're probably sitting around saying, "how did this happen?" I've seen people posting how you can do everything with a WinMo phone and more than anything else, but who cares. The user experience is terrible.
What people look for is: will it sync with my computer? Can I back up my calendar & contacts? How easy is it for me to send a text message? How quickly can it get me to the app I want when I want to get to it?
Technical coolness (things that engineers care about) won't sell phones. Phones that are elegant and have an intuitive interface (something Motorola NEVER figured out on their own) is what sells phones to the masses.
Open source people need to learn that the interface is the most important thing you can do to your program or OS because that is how your user interacts with it. I've only seen Android 1 phones, but their interface seemed to be perfect for people who understand UNIX. Try try again.
Over the past year or so that we have had these phones we have tried all kinds of UI styles and most of us have ended up with very minimal UI styles that let us get to the applications we use more with the lest amount of clicks or presses. the UI is the single most important aspect of any device.
Gone off of everyones phones:
widgets, that we thought were cool as hell a year ago. These went the same way as the widgets on our vista machines, which was to disable them and the sidebar.
apps: YouTube, Facebook, IM clients, Netflix, Flickr, Google Maps, just about everything but mobile office and the built in Microsoft applications with the exception of many of us using Opera as a browser. We went app crazy at the beginning but that desire has really faded these days.
I don?t care what os
I?m not a techie?.. I want convergence and simplicity
Nav, Text, Voice, Data, Music, Video, Pics, Etc.
Make it intuitive.
My point is that specifications only go so far and its the all-round package that matters. So far I am not seeing anything exciting about the Droid (I also don't live in the US) but I do wish Motorola all the best with it.
So far, reviews have been quite good (and i disagree with it being specifications driven. maybe before they released demos to various folks it was, but it was the same with the iphone. people had little to go on until they could use it, so its a moot point.) except they said usability is slightly less due to it having more features than the iphone.
I'm locked into my VZW contract until next summer. I had been intending to switch to an iPhone when that was up. This phone will definitely be a consideration when the time comes. Some key points for me will be:
1. Does VZW update this as Google advances Android? Apple has been doing regular iPhone updates. Google seems to be moving at a fast pace. I don't want to be stuck for 2 years if VZW isn't keeping up with Google advances.
2. What does the app landscape look like then?
3. Pricing for overall plans, AT&T vs VZW.
What will the next Driod killer?
http://cellphoneforums.net/cell-phone-reviews/t304605-motorola-droid-review.html
One of the nice things about MS systems, for example, is the ability to utilize more third party software. It's also one of the things that leads to most of the problems. Macs aren't as open and customizable, but they are stable and secure.
Will the marginally better tech specs be sufficient to attract current iPhone users to change?
Has Motorola come to the party too late?
For me, the two most important features in a smart phone at this point in time are 1, the ability to use the device abroad, and 2, full internet connectivity. I can't stand the watered-down mobile phone optimized internet sites. I want the full features of the internet on my phone.
Consumers are very fickle, and make their buying decisions more out of want than need. If they just "need" a phone, there's plenty of free devices out there. Good marketing sells high-end phones. This is where Moto/VZW will have an advantage since their ad budgets are huge, and can plaster their ads everywhere to help influence buying decisions.
It's impossible to predict what the market will look like in the next year or so, but one things for certain...
The real winner is Google, and not the handset manufacturers.
All in all, it's an impressive device, but lacks some of the polished details I believe the device needs to really divert attention from the iPhone.
I predict that in the next year we will see huge growth for Verizon and Android phones, at the expense of AT&T and the iPhone. Apple will probably be releasing the iPhone on Verizon's network in order to minimize market loss to Android. The Droid itself will be a success just because it is the first Android 2.0 phone and it's on the Verizon network, but "coolness" is still a very important selling quality, and the Droid doesn't do anything to increase Motorola's "coolness" factor.
What will happen when Apple and Verizon finally come to terms on a partnership? The iPhone Killer market will only become worse, strengthening both their positions.
Stop trying to catch up. Do what Apple did. Make your own damn phone.
I agree with Ski2moro..the simple features he mentioned IMO should have already been resolved by now...and I mean by every phone/software manufacturer...no excuses.
If I can browse webpages the way meant to be, take my phone around the world...they would have me in their pocket..otherwise is just another expensive useless toy cell phone....and one more thing...550 mhz processor???? thast nothing...i have a 680 mhz now and it still has lagging issues...its going to be a problem even android.
This is the reason I just wait 2 years and get the phone for free. Why spend money on something that doesnt work that well...or doesnt work at all... and spending alot of money monthly for something youre rarely able to use...
So far Im happy with my Winmo software ( i know, i know we all hate the windeathstar) it does all that it nees to do in order to bring the money in my pocket and not waste my time and frustrate me ( like the iphone, Blackberry ) with send/receive emails or open and share documents/images/video/sketches, etc.
Why would i want to spend money buying applications to do this when i can just buy the complete package...until then is just another development project that we all pay for...they dont pay you to test their devices..do they?
My thinkering with devices/software days are over...some of us just need to grab one and go.
Like many companies they want to make money without spending any...therefore u have the android...and I know some ppl like tinkering..and thats great..brings alot of innovation, but they have to think of the ppl who run around the world doing business. ( and dont say Blackberry..those phones drop calls more often than Iphones... and not to mention theyre big bulky phones with small screens.)
I persoanlly think Samsung and HTC have better looking and working phones...I can take em all over the world and get the job done...If you want an android phone i recomend one of these... better features processors and much much more.
I wont fall prey to these marketting schemes... ( look what the iphone did, it dragged its followers for years without working/or none at all email, video or cam!!! (and they still take the abuse ) brainwashing is great for business and they did a great job!!!
This phone is another BB storm!!! alot of ppl will buy it and return it.
Ok venting is over!!
- by yours_truly_michael October 30, 2009 9:24 AM PDT
- Save Motorola? Of course, the DROID is an amazing device, so long iPhone, it was good while it lasted!!!
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- by AppleSuxLeo October 30, 2009 10:19 AM PDT
- Who in their right mind really thought the iPoser with it`s closed , proprietary, walled-garden model would remain a monopoly ?
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