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Motorola CEO Calmly Prepares for the iPhone Storm

Ina Fried — Thu, 02 Dec 2010 20:02:32 +0000

Arguably no company gained as much from Verizon’s lack of an iPhone than Motorola. Needing something to rival Apple’s phone, Verizon spent a fortune on its Droid brand and Motorola sold a lot of phones. But with a Verizon iPhone appearing imminent, it’s also true that it is one of the companies most at risk.

Speaking at an investor conference on Wednesday, Motorola CEO Sanjay Jha made his best case for the company and its opportunities in both smartphones and tablets. Motorola also plans to have 4G phones in the market early next year, Jha said, without giving specifics. But he also acknowledged the company is headed for some serious turbulence.

The first quarter is normally down from the prior quarter, but this year’s first quarter is shaping up to be a lot worse, with the cellphone unit expected to post a loss.

“We have an additional challenge potentially with Verizon,” Jha said, speaking in code so as not to use the iWord. “There is a competitive dynamic developing.”

Mobilized isn’t afraid to say the phone that must not be named. He’s talking about a Verizon iPhone.

Jha talked a lot about the company’s efforts to diversify–selling more phones to carriers other than Verizon, increasing sales in Latin America and China, and adding tablets. Jha said the company will sell both 7-inch and 10-inch tablets.

However, clearly not everyone was impressed. As noted by Barron’s, Nomura Securities launched coverage of Motorola stock on Thursday with a “reduce” rating, saying that a CDMA iPhone could ultimately push Motorola into the mid-tier of the smartphone battle, where it will face more competition from Asian makers, such as Samsung.

And the timing could hardly be worse for Motorola, which is spinning off the cellphone unit, a process that is slated to be completed on Jan. 4.

Longer-term, Motorola faces the challenge of using an operating system, Android, that is used widely in the industry, while spending more than rivals on research and other development costs.

One conference attendee suggested HTC’s research costs are a third of what Motorola spends. Jha said that there is a difference in the two companies’ cost structures, but rejected the idea that it was that pronounced.

“I think we are investing more in software differentiation,” he said. “I think we will make that investment matter.”

There’s also the fact that the phone businesss is so hit driven. That’s something the company learned on the positive side with the RAZR way back when, and on the negative side in the drought that followed the release of that slim flip phone.

Although the competition among Android devices is fierce, Jha said he doesn’t regret the company’s bet back in 2008 to focus so much of its resources on that operating system.

“There are obviously tradeoffs in every decision,” Jha said. “But on balance it’s been a very, very good decision for us.”

Jha said he knows that in order for Motorola to produce the kind of profit margins it wants long-term, it will have to be able to differentiate its software. Hardware differentiation, he said, gives only a six-month advantage versus doing something unique in software.

“I don’t think I can get to a gorilla position from where I am in one easy sweep, but I think it is possible to create differentiation in this business,” Jha said.

Superphone Vs. Smartphone

Nitrozac and Snaggy — Wed, 06 Jan 2010 21:49:01 +0000

Here is the latest comic from our Joy of Tech friends at Geek Culture, Nitrozac and Snaggy. Joy of Tech appears three times a week in the Voices section of this site. (Click on the image to see a bigger version.)

RIM Product Line More FrankenBerry Than CrackBerry

John Paczkowski — Fri, 26 Jun 2009 18:00:53 +0000

With the Palm Pre and iPhone 3GS in stores and the myTouch 3G, T-Mobile’s second Google (GOOG) Android phone, headed to market, is the Research in Motion (RIMM) product lineup beginning to look a bit dated? Which leads to another question: Has RIM’s success made it too complacent?

GC Research analyst Tero Kuittinen believes it has. In a research note Friday, Kuittinen described the company’s Blackberry product range as “shopworn,” noting that even the new Blackberry Tour is quite close to the aging Curve in look and feel.

“We are concerned about the autumn and winter Blackberry product range–RIM seems to have made a deliberate decision to rely on incremental improvements in mid-range and low-end models instead of bringing advanced features aggressively to cheaper devices,” Kuittinen writes. “Considering how competitive the smartphone market is getting, we believe this cautious approach may begin backfiring in the autumn and particularly during the Christmas season.”

Kuittinen goes on to question the logic of the company’s new flip phone initiative, wondering why the company is rolling out its 8230 clamshell at a time when consumers are so enamored with large display devices like Apple’s (AAPL) iPhone and the new Palm (PALM) Pre. And that’s a great question because, well, the contract phone bestseller lists at most carriers aren’t exactly overrun with clamshells these days, are they?

“Overall, RIMM’s expansion to flip phones is ill-timed, and the Tour line lacks kick and the low-end improvements are minor at best,” Kuittinen concludes. “It is the combination of these three simultaneous factors that leads us to believe RIMM may have become lulled into complacency by the stellar success of the Blackberry devices over the past couple of years. The year 2009 is a tough period to let your product development program spin its wheels.”

Hard to disagree with that assessment given the handset launches we’ve seen so far this year. But perhaps the Storm 2 will prove Kuittinen wrong on that account. Perhaps it will even raise the bar a little. But even if it does, will that be enough to invigorate the entire product line? Kuittinen doubts it. “One major big-display phone launch, in our opinion, may not fully offset the slight malaise afflicting the rest of the Blackberry range in the autumn,” he concludes.

Below, our D7 Interview with RIM CEO Mike Lazaridis.

[ See post to watch video ]

Verizon Apologizes to Obama: Sorry We Snooped on Your Account

Peter Kafka — Fri, 21 Nov 2008 12:02:53 +0000

This may make it easier for Barack Obama to kick his well-publicized BlackBerry addiction: News that Verizon employees have been snooping through his phone records.

Verizon (VZ) said Thursday night that “a number of Verizon Wireless employees have, without authorization, accessed and viewed President-Elect Barack Obama’s personal cell phone account.” Verizon says the phone is a “simple flip-phone,” and not a Berry, and that it has been inactive for several months. But the startling public admission should be enough to convince Obama, if he needed any more prompting, that he’s going to have to give up his prized gadget.

It may also prompt Verizon to rethink its long-running ad campaign where its customers are followed around by hordes of the mobile company’s employees.

New BlackBerry Offers Versatility in Flip Form

Katherine Boehret — Wed, 15 Oct 2008 00:18:02 +0000

Smartphones are masters of multitasking. They email, browse the Web, instant message, take pictures, run applications or play videos and music. So it’s easy to forget how uncomfortable they are to use as phones. Most are rectangular slabs that are awkward to hold against the ear, causing many smartphone users to also carry a basic cellphone just for calls.

At least one smartphone manufacturer is doing something about this. This week, Research In Motion (RIMM) introduced the BlackBerry Pearl Flip 8220, available for $150 with a two-year contract from T-Mobile (DT). This device is the first BlackBerry in a flip phone, or clamshell, form. Like RIM’s mainstream, candy-bar-shaped BlackBerry Pearl, the Flip uses a SureType keyboard, which has condensed keys and relies on predictive text software.

The Pearl Flip uses a SureType keyboard, which takes up less space.

After using the Pearl Flip for a week, I’ve found it to be a stylish messaging device that works well as a comfortable phone. I really liked its exterior screen, which is designed to show previews of incoming messages, saving people the trouble of flipping open the device. It runs on T-Mobile’s slow EDGE network, but has built-in Wi-Fi and the ability to automatically connect to saved, nearby wireless networks.

First-time smartphone buyers will likely find the Pearl Flip to be a good fit. When it flips open, a special hinge drops the top half of the device slightly behind the bottom half, and a handy trackball makes navigation easy. The Flip’s Web browser enables streaming videos that look sharp on its interior screen, and a microSD card slot supports up to 16 gigabytes of memory.

But current BlackBerry owners who want to switch to a device with a more comfortable phone may have trouble adjusting to the Pearl Flip’s SureType keyboard — especially if they’re used to a device with a full QWERTY keyboard. Though the Pearl Flip’s keyboard is a generous size and its keys are flat and easy to press, its SureType design assigns two letters to almost every key, which can be frustrating to use when predictive text guesses a different word than that which is intended.

The Pearl Flip 8220 is RIM’s first flip phone BlackBerry.

The Pearl Flip supports T-Mobile’s Unlimited HotSpot Calling, a service that doesn’t use any minutes on phone calls begun in Wi-Fi zones. Even if a user leaves the Wi-Fi zone in which he or she started a phone conversation, the call passes over to the T-Mobile cellular network without dropping out. This service costs $10 monthly in addition to regular service charges.

When I made calls on the Pearl Flip, friends on the other line noted how crisp and clear our connection sounded. And best of all, the Pearl Flip’s long, clamshell profile was easy to hold and fit snugly and comfortably between my ear and shoulder when I needed two hands to carry things.

BlackBerry’s signature red light blinks in this device’s top corner to indicate new messages. The 1.6-inch exterior screen displays about 25 words (give or take) from newly received emails, instant messages, SMS, MMS, calendar notifications and task reminders. If a message is received from a contact to whom a photo is assigned, that photo also shows up on the external screen to identify the sender. Side buttons let users scroll up or down through these previews.

This display is designed so that the same message being previewed externally will appear on the internal screen as soon as the Pearl Flip is opened. This makes sense because people will want to reply to some emails or read their entire contents after seeing a short preview. But my device didn’t do this at first; instead, the internal screen seemed completely unrelated to the external screen. I finally got this feature to work after my external screen froze and I rebooted the Pearl Flip. RIM said it hadn’t seen this behavior before, and wasn’t sure what had caused it.

The interior screen measures 2.4 inches diagonally and has a resolution of 240×320 pixels, which is a larger, higher resolution screen than most basic cellphones. While using Wi-Fi, I pulled up YouTube.com and watched a video. It played without skipping or stopping while streaming directly from the Web. A higher-resolution video, which was saved to my device, automatically played in horizontal mode so as to take up the entire screen; YouTube videos play vertically, without using the full screen.

Up to 10 email accounts can be set up on the Pearl Flip; I had no problems using Hotmail, .Mac and Gmail accounts. I also signed into AOL Instant Messenger and Google Talk on the Pearl Flip. Along with these messaging programs, ICQ, Windows Live Messenger, Yahoo Messenger and BlackBerry Messenger also come pre-installed and ready to use.

If my Pearl Flip was closed and I remained signed into an instant-messaging client, notifications appeared on the external screen telling me who was sending an IM and what it said. When I opened the device, I was automatically directed to the screen where I could reply to the instant message.

I tested the T-Mobile Unlimited HotSpot Calling feature by starting calls using a Wi-Fi network and then leaving the network’s range. The calls remained steady without dropping or fading, and if I were a paying customer, I wouldn’t have been charged minutes for those calls. Calls that start out of Wi-Fi zones and end in Wi-Fi zones do deduct minutes. My Pearl Flip had no trouble automatically moving from the cellular network to a Wi-Fi network.

All T-Mobile Wi-Fi hotspots, such as at airports or in Starbucks (SBUX), automatically work with the Pearl Flip if you’re registered for the $10 monthly Unlimited Hotspot Calling.

If you’re considering taking the plunge into the always-connected world of smartphones, or if you want a more comfortable phone in your smartphone and don’t mind the quirks of SureType, the Pearl Flip 8220 may be the BlackBerry for you.

– Edited by Walter S. Mossberg

Email us at mossbergsolution@wsj.com. Find this and other columns and videos online free at the All Things Digital Web site: http://walt.allthingsd.com