New Motorola phones aim at high-end market

New Motorola phones aim at high-end market
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First Published: Wed, May 16 2007. 10 54 AM IST
Updated: Wed, May 16 2007. 10 54 AM IST
New York: Motorola, the mobile phone giant, is hoping to revive its deteriorating business prospects with some slick new phones and a little celebrity gloss.
At an event in New York on 15 May, the company announced a sequel to the company's hit Razr phone; an update to the Motorola Q, its rival to the BlackBerry; and a new line of handsets designed to play music, video and games.
The phones are aimed at the more-expensive end of the market and are optimized to work on high-speed third-generation wireless networks, currently popular in Europe and Asia and gaining ascendance in the United States.
“These phones are aimed at classy users we haven't been addressing,” said Motorola's chief executive, Edward J. Zander, who has been guiding the company through a turbulent yearlong downturn while fending off the billionaire financier, Carl C. Icahn, who unsuccessfully sought a seat on the company's board. "We are demonstrating we can still build some great products, and that we have always had our head down."
The Razr 2 is a follow-up to the original Razr, introduced in 2004. Motorola said that it in a few weeks, it would sell its 100 million Razr phone.
The new version is 2 millimeters thinner than the original, has a second screen on the outside, and has more memory and an improved user interface. It is also made of sturdy stainless steel and chemically hardened glass, which Zander demonstrated by unfurling the phone, placing it on a desk and banging on it with his hand.
The Razr 2 also features Motorola's Crystal Talk technology, in which the volume of a phone call automatically increases with the background noise. The phone will be available this summer. The company did not discuss prices or agreements with wireless carriers.
For e-mail-addicted business users, Motorola also introduced the Q8 and Q9 -- an update to last year's Q, a keyboard-equipped messaging phone. The new Qs are thinner, with more memory and better cameras.
Motorola also displayed a new music phone, the Rokr Z6, to compete better with the leader in that category, Sony Ericsson, which has sold 17 million Walkman phones. The company also discussed a new multimedia phone called the Z8, which takes pictures, downloads television programs, and plays music and games.
Motorola hopes the new gadgets will help reverse its recent slide. Hit by declining margins and a dwindling share of the market in its mobile phone business, the company lost $180 million (Rs735 crore) during the first quarter of this year and announced plans to lay off thousands of workers. Since October, its stock has declined 37%.
The company still has significant challenges ahead, according to several analysts who attended the event. The company has recently had a difficult time convincing shoppers to pay hundreds of dollars for its new phones when wireless carriers are selling their old handsets, like the Razr, at steep discounts.
Motorola also does not yet have a comprehensive product line at the priciest -- and fastest growing -- segment of the market, where Apple's coming iPhone will most likely make a splash this summer.
"I am impressed with the new Razr," said Avi Greengart, an analyst with the research company Current Analysis. "But they are not taking the old Razr off the market, so you will still have this issue of self-cannibalization."
Motorola has one other challenge it will have to address. As spectators at the event demonstrated by picking up several sample units of the new Razr 2, the glass casing, though striking, is easily besmirched by fingerprints.
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First Published: Wed, May 16 2007. 10 54 AM IST
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