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Hello Moto: Motorola Unfairly Compared With Apple

October 28, 2014 - Written By David Steele

For a business that’s between owners, Motorola sure don’t know when to give up. Their recent devices – the 2014 Moto G, Moto X and today’s freshly announced Motorola Droid Turbo shows us that the manufacturer isn’t going to give up and wait for Lenovo’s inspiration. Far from it. The Moto G and Moto X are superb devices and the Droid Turbo looks so epic I’m surprised Hollywood haven’t already made the movie and a sequel.(insert Michael Bay joke here)Motorola President and Chief Operating Officer, Rick Osterloh, has been talking about Moto today and has drawn comparisons between Motorola and Apple from the late 1990s, when the company was clearing its financial difficulties. On the matter, Rick said, “Quite interestingly, what we’ve gone through in the last year and a half is what they went through many years ago.” However, where Rick believes that Motorola is different to Apple is in how the businesses are lining up their strategies. And whilst I don’t want to hate on Apple too much, the fruit company does not appear to have a viable strategy for dealing with what Google are calling “the next billion,” meaning the developing smartphone markets.

You see, Google has Android One, Motorola has the Moto E and Apple simply don’t have an inexpensive iPhone product for emerging economies that is capable of running the latest OS. For all their posturing about Android’s fragmentation, their interpretation of a cheaper iPhone (the 5c) was almost as expensive as the premium model. Rick says that Apple’s reluctance to approach the emerging (and cheaper) handset market creates a “huge vacuum” in emerging markets. “That’s an enormous opportunity,” he said. Samsung are also in the same boat as they, too, do not have a viable emerging markets strategy. Still, whilst Motorola’s cheaper devices are competing at Android One prices, they are not quite Android One devices. It remains to be seen if Motorola will continue to offer the E, or a similar device, after the Lenovo purchase is complete (expected in the next couple of months). But we do know that Motorola is capable of producing an inexpensive and good product.

This is important because in the developed smartphone market – the USA, UK and Continental Europe – we’ve reached the point whereby the majority of smartphone sales are to upgrading customers on their second or subsequent smartphone. We’ll see market share moving between the manufacturers (and platforms) but ultimately, there’s little long term sales growth. In the developed markets, smartphone penetration is still low such that most sales are individuals’ first smartphone. This is where we’re going to see strong growth in the coming years. Motorola have reemerged from the darkness. They’ve managed to be one of the most talked about Android Wear manufacturers thanks to their Moto 360. Rick calls the Moto X “a modest success,” but Moto Builder is being rolled out to other countries and today we’ve seen a 24-hour sale in the UK, mirroring what the business did in the USA. They’re making the right noises, doing the right things. Moto are back. Hello Moto.