Motorola was a darling after it launched the Droid in November 2009, but now it is stumbling in the face of mounting competition from Apple's iPad and iPhone.
Motorola Mobility ramped
sales 22 percent for the first quarter 2011 and shipped 4.1 million Android
smartphones, but it can hardly be said that it's in a comfort zone.
For one, the company's
Motorola Xoom, the first tablet to use Google's new Android 3.0
"Honeycomb" operating system tailored for tablets, was characterized
as rough, unfinished and difficult to use by some analysts and experts
comparing it with Apple's market-defining iPad.
Motorola said the Xoom sold
250,000 units for the first quarter, while the iPad shipped 4.7 million units
in the last quarter.
analysts last month when it said its second 4G Android phone, the Droid Bionic's
released, which was expected in the second quarter, would be pushed
to the summer.
These happenings beg the
question: Is Motorola sacrificing quality for the sake of being first to
market? If this is the case, it makes absolutely no sense.
Look at the Xoom issue. With
80 percent-plus market share, there is no catching the iPad or iPad 2 in the
near term. Gartner Research analysts reasoned
Android tablets could cut Apple's share to 47 percent but not until 2015.
There was no reason to rush
the Xoom to market when Motorola could have crafted the slate to differentiate
from the iPad in a way that made people feel they had to buy one.
Perhaps, the same could be
said for all Android tablets, including the LG G-slate. Forrester Research analyst
Charles Golvin noted all the Android tablets have underperformed in the market
Gartner analyst Ken Dulaney
told eWEEK the Xoom is a good solid product. "I just think that the iPad
has the market lead and people today can't see a reason not to buy an
Global Equities Research
analyst Trip Chowdry polled several early Xoom users and visited several Xoom
retailers to come to the conclusion that the Xoom is a weak product compared
with the iPad.
As for the Droid Bionic,
the handset's hardware and software require a refresh.
Motorola desires to better compete with the popular HTC Droid Thunderbolt and
the forthcoming Samsung Droid Charge on Verizon's 4G LTE network.
Forrester's Golvin agreed,
noting that Motorola didn't feel its product was adequately differentiated in
the market today against the other LTE phones and decided to invest in
improving it so that it would be.
"I would expect them to
focus on the OS [as you suggest] as well as battery performance; NFC [near-field
communication] is possible but that is not a feature that means much to
consumers yet," Golvin added.
Chowdry said Motorola has
grown more reactive since Apple's January launch of the iPhone 4 on Verizon,
the same carrier that helped push Motorola and Android into the limelight with
a $100 million marketing campaign for the Motorola Droid.
Indeed, Verizon for 15
months was the flagship Android supporter. The positive reception of the iPhone
caught Motorola off guard. Now, the company must retrench and regroup against
not only Apple's innovation, but also those of its Android rivals in Samsung
"Motorola may have
missed the demand for 4G, and if you look at their software add-ons to Android,
they pale in comparison to HTC and Samsung," Dulaney said. "They have
tiny icons and a battleship grey background. They need to understand the
presentation of their products in the store. Or they will lose sales."
With no Droid Bionic on tap
in its second quarter, it will be interesting to see if Motorola can continue
selling millions of Android phones, versus the Verizon iPhone and popular
Android handsets such as Verizon's ThunderBolt, T-Mobile's Sidekick 4G and
Sprint's forthcoming Nexus S 4G.