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Will Motorola end up another BenQ Mobile?

By Damian Koh

Once the pioneer of the mobile telecommunications industry in the 1980s, the handset maker is now nothing more than a derailed train, marking the possible end of an era.

Of course, Motorola has surprised us before, making a phoenix-like resurrection from out the ashes with its iconic RAZR. Dare we hold our breath?

For now, amid reported internal turmoil (poor management) and external pressure (from activist investor Carl Icahn), we could already be witnessing Motorola in its final ailing moments. The question now isn't whether the company will sell off its handset business or spin it off, but rather, who's going to buy it and what will happen to the consumer brand everyone knows of when it comes under new management.

Unlike the current economic slowdown which has forced economists, policymakers and analysts to hark back to the Great Depression for something comparable, one doesn't have to go that far back in the annals of mobile history for a classic illustration of how things may turn out.

The case in question: BenQ Mobile. A year after BenQ bought German-based Siemens' mobile arm, the mobile brand filed for insolvency, leaving barely a ripple in the mobile space. And the culprits are ultimately those that Motorola is facing as well: Poor company management and lack of innovative follow-up products.

To cite Windsor Holden at consultancy firm Analysis in a quote to ZDNet UK on BenQ Mobile's liquidation: "Even when the product seemed promising, the company failed to launch on time. It's been a mess, frankly."

Bailing out

Still, it's not entirely impossible that one of Motorola's rivals may be interested in bailing out the phone-maker. Suspected suitors exploring this avenue include Dell, Toshiba, Huawei, ZTE, LG and, perhaps, even Samsung.

With the infusion of investment funds and a new management onboard, the latter two companies in particular could leverage on Motorola's assets to close their gap on market leader Nokia. According to a Gartner report for Q3 last year, LG and Samsung increased their market share by 1.1 percent and 2.3 percent (compared with the same period the year before), placing them in the second and fifth spot, respectively.

If only it was that easy. Samsung already has a brand to call its own with a market share that is growing steadily, and it doesn't make much economic sense to take over the financial burdens of Motorola. In June last year, Samsung has also announced plans to expand its mobile phone production capacity in India, one of the world's fastest-growing cellular markets.

LG, on the other hand, may not have the necessary resources. "It doesn't look like they would have the funds for such an acquisition," Lee Min-hee, an analyst at Dongbu Securities, told Reuters in a recent report.

Can we live without a Motorola that brought us the iconic RAZR (2004) and StarTac (1996), no matter how brief these blockbusters were? Will we have to relive the BenQ Mobile debacle again with Motorola?

Share your views in Talkback.

 

 

    Talkback
anilporwal says...
Eventhough the prospects for Motorola don't look very bright at the outset, they are not bleak altogether. Just guess if the likes of Apple make a joint venture with MOTO! They already had a small tie up with Apple for iTunes in many of their phones including the iconic MotoRAZR V3i. The combination can be killing.

 
 
sylclh says...
2008 is a do-die year 4 MOTO....so HELLO motto, you should just come up with a real successor to RAZR or you are doom to oblivion...

 
 
nubnub75 says...
All of this happened in such a short amount of time that it's ad, really. Farewell, Moto!

 
 
marcuslow says...
i have sent motorola a mail on the day razr was released.
As much as it was a great sellout , the phone lacks serious substance. in fact i have a list of 10 items that could be put into a phone and be a constant winner.
Everyone i know who used the razr or any other recent motorola phones are hit by the regret symtoms after just 3 months of using, thats what a dumb blond will get u if you marry one.
I have been playing with mobile phones since the pcn from motorola, its very obvious what features are needed and what improvement needs to be done to a motorola handset to make it a success.
What i got from their dept was a reply template, of "thank you for writing to us." . No one takes free consultation seriously.

 
 
papergoon says...
I feel that although Motorola is currently failing, they are not doomed. Unlike Siemens which have not been popular before, Motorola has. the RAZR has been a major milestone in mobile phone history. I feel that Motorola has a chance of redeeming itself. Motorola simply need to do more thinking and more design R&D. Hopefully they won't simply crash and burn, considering they were the 2nd largest mobile market seller just 2 years ago.

 
 
DJmakoto says...
Honestly in my personal opinion Moto needs to re-establish itself by doing the following:
1. Better QA with their products
2. Better understanding where the market is heading
3. "Must Have" edge
4. Better batteries!
5. No more Razrs ~_^ ... unless it can be improved upon

 
 
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