The stakes are high for "Motorola - a
) company." The market response to
, Motorola Mobility's big bet flagship smartphone that was
announced today, will signal whether the once renowned cellular
phone maker could make a powerful comeback and get out of the red.
In 2011, Google pledged to pay about $12.5 billion to buy Motorola,
thus joining the ranks of smartphone manufacturers. The company has
had little success in this category so far, despite the domination
of its Android OS in the global smartphone market.
Motorola Mobility has been bleeding money and losing employees
since becoming part of Google in the spring of 2012. The mobile
business has recognized $1.66 billion total in operating losses
since then, without a single profitable quarter. The company's
headcount was trimmed roughly fivefold, from 20,293 to 4,599.
Motorola Mobility has been consistently reducing its global
dropping one market after another
, and giving up control of its manufacturing plants. But even these
moves didn't help the company remain afloat on its home turf. Its
Droid line didn't seem to strike the fancy of American customers,
declined quarter after quarter
Moto X might be the savior the company desperately needs. Promoted
under a "Made in the US" banner, the device will be "the first
smartphone designed, engineered, and assembled in the USA," as the
Motorola Mobility CEO Dennis Woodside
that 70% of the device will be assembled in a Fort Worth, Texas,
factory run by Motorola's manufacturing partner
), a global contract electronics maker headquartered in Singapore.
But will the appeal to patriotism and an
enormous $500 million marketing budget
prompt consumers to pay $199 on contract for the device? Except for
its slim and sleek design and signature curvy back, Moto X doesn't
offer much in the way of special features; it is hardly worthy of a
Moto X features a 4.7-inch AMOLED 720p display and 10 megapixel
main camera, and it uses Motorola's X8 set of chips. It essentially
combines a couple of different processors "under the one hood," but
most of its power comes from
) Snapdragon S4 Pro running at 1.7 GHz, which is similar to the
processors used in the updated Nexus 7 tablet and the Droid
announced in July
Moto X comes in two versions, with 16GB or 32GB of storage that's
not expandable (two years of free 50GB on Google Drive is included
as bonus). The promised battery life is up to 24 hours.
While the hardware itself is solid, it's far from being impressive.
A number of similar or faster devices are already on the market,
(OTCMKTS:SSNLF) heavyweight Galaxy S4.
As for its software, Moto X runs Android 4.2.2 and offers Active
Display updates (important notifications appear on the screen even
if the device is not fully powered), Touchless Control (the phone
is always "listening" for voice commands), and an improved camera
The personalization options look promising, to say at least: Users
can customize the color on the front and back of the phone and will
have thousands of shades to choose from. The company is also
working on a back made of wood. Customers can also choose the type
of edges the phone will have and the color of the volume buttons,
and they can still have the phone delivered within the US for free
in four days or less. However, whether customization options will
have an impact on sales is uncertain.
Moreover, pressure from the upcoming
) iPhones -- not to mention current Android flagships from Samsung,
(TPE:2498) -- might seriously hurt Moto X sales, which begin in
late August in the US.
So could a single "Made in the US" phone model save the ailing
company and bring Google something more than just a boost to its
patent portfolio and poor financials? At least Motorola has already
saved its own reputation with the
the RAZR line-up,
first released about a decade ago, and Moto X looks like a sound
attempt at a comeback, anyway.
Google's stock price rose nearly 2% to $904.22 today (August 1)
after this news was announced.