This means that the Moto X will be a high end phone, but not as high end as the S4 or the HTC One. With lower component costs, lower R&D costs and lower margins the Moto X could have a wholesale price of under $300. And that leads to the second point. The LG Nexus 4. It costs just $299 and is a high end phone with a 4.7 inch 720p display, a Qualcomm Snapdragon S4 Pro processor, 2GB of RAM, GPS, NFC and Corning Gorilla Glass 2.
That means it is very possible to create a high quality, lower cost Android smartphone. But although the Nexus 4 has been very popular it hasn’t really dented Samsung’s dominant position. Winkler is suggesting that Google doesn’t care about its partners because it is going to use Motorola as a direct means to compete with those very same partners. If that were true, the very existence of the Google Nexus range should have sent Google’s partners into a sulk years ago. Although Google has always used its partners as manufacturers for these devices, each phone and tablet has a different manufacturer, so one could always complain or worry about an advantage that a direct competitor is receiving from Google. This simply didn’t happen.
Thirdly, Winkler points out that Chinese companies like Xiaomi are doing well with lower priced high end smartphones. It is thought that Xiaomi probably generated around $2 billion in sales in 2012. He attributes the success of the Chinese maker to its strategy of selling high-end smartphones for less than $300. And he is right, but it also serves as a reminder that the world isn’t just the USA. By the end of 2013, about half a billion Chinese users are expected to own smartphones, ninety percent of which will run Android. For Motorola to make in-roads into Samsung’s market share it needs to think about sales outside of the USA. Samsung is already ahead of the game in China where it posted record high sales with over 12 million units sold in the first quarter of this year.
The bottom line is that the Moto X will be a high end phone with a very aggressive price point. It will have betters specs than the current Nexus 4 and will sell at the same or a lower price. If it isn’t better and cheaper than Motorola will go the way of the dinosaur. Traditionally Motorola has been strong in the USA and it has good working relationships with the carriers. That means that US buyers will likely see some good contract related deals for the Moto X. As for the rest of the world, a more aggressive pricing strategy from a big brand could signal a shift in the price/performance ratio of Android smartphones, but that really depends on how aggressive Motorola intends to be.
Like this post? Share it!
i don’t know about what Motorola thinks , but i only know that price is important factor , if right price is given for hardware people will buy it.
It should. Maybe others will follow suit too. Besides that, by lowering something $50 that you sell 30 million units of is a lot. So of course apple and Samsung won’t like this. Are they worried about losing there #1 spots? No. But there scared there going to make less money. Those CEOs want to keep there insane salaries for as long as possible.
& tablets and phones have taken a sharp turn to inexpensive. Thanks to Google’s Nexus devices, and there’s been a multitude of inexpensive tablets. Just a matter of time until phones drop in price like Tablets already have, because the competition is so fierce. Also consumers are realizing being in contract sucks and waiting 2 years for a new phone is stupid. If ur not under contract very few people are willing to pony up $600-700 for a phone.
“tablets and phones have taken a sharp turn to inexpensive”
about time isn’t it ? the same thing happened to PCs and TVs. so why not to phones ? everyone seem to be moving onto wearable computing as their big ticket to big moolah anyways
Hell yeah its about time
This article lacks foresight into the future of cell phone pricing battles and how a successful device could lead us into that land with time…it’s now about now or tomorrow but years to come. The biggest risk for Motorola at this point is not delivering on the user’s experience with the phone. The CEO feels confident that Motorola will deliver as no other companies has before. While Samsung makes great phones their features are often shock and awe more than they are increasing one’s personal interaction with their phone in a way that makes life easier and more efficient. If Motorola delivers on this with the price point they plan it will cause the ground to shake..immediately? Of course not, Rome wasn’t built over night.
Gotta sell phones first…
This is great news from Motorola. 550$ should’ve been the max off contract price of a smartphone. But now phones cost between 600$ to 750$ unlocked. Price, Hardware and at least 2 major Operating System updates are the factors which are the most important to me. My Motorola Atrix HD is an amazing phone. I can use it during any kind of weather because its waterproof inside and out.
The Nexus 4 didn’t sell as hot as let’s say the Galaxy S 3 simply because of supply issues. The demand was and still is HOT for a top-quality device at an affordable price, however LG could not meet those demands and the Nexus 4 suffered from multiple stock issues. If Motorola can meet the demands with a healthy stock, oh you better believe it’s going to get very interesting in the race to be #1. Give me a $300 stock-Android device with a Snapdragon 600, 400+ ppi 4.7 inch display, 3500 mAH battery, and 4.2.2 JB. On-board storage will probably be low but they could add a microSD card slot. Of course a good set of cameras and LTE are must-haves.
No, what really happened is that Google only ordered so many phones. Google gave LG number (X) of phones, and LG made them. Google didn’t realize how many people would buy them.
Not to big a problem. The people who can afford a S4 will continue to buy the same priced phones thinking they are paying for quality.
I do think S4 offers a lot more than a nexus 4. google (and even motorola) might not give a few extras like large storage/ sd card slot, stylus like note 2, etc. so there are a few reasons staying with samsung for samsung fans. more than anything else google sucks goatballs when it comes to service.
APai and samsung doesn’t lol ? last time i checked they are very late on updates and when i had an S2 that had a bleeding LCD I HAD TO PAY because they said it had water damage…..from an otterbox lmao yea right. I have dealt with google and CS was adequate. It all depends on who you get when you call and if they are having a bad or good day so please…stop throwing invalid points up as CS is dependent on the rep you get not on the company.
google simply does not have a adequate CS interface. look at the google apps mess – I had a ton of problems unresolved. they left it to the community for much of the issues. for a free product when it existed it was good. however the CS was non existent. in case of microsoft – apps for domains , the google equivalent – there are a few adins who at least respond, even if it takes a few days. I’ve had a few areas where google has had terrible CS.
Who needs there cell phone manufacturers to have good customer service? I may be wrong, but how many times do you call Samsung?
nexus 4 was good enough for a lot of people. also nexus 4 was timed sweetly – so it would be future proof for at least 2 years. given that it gets the latest android first up – I would say yes to any nexus device. it’s also interesting to see more nexus experience devices out there. we need choice. choice was the premise for android – so hell yeah! motorola wants to do it ? sure! I for one would love to see it happen
Considerations for a new phone:
1. Carrier. If it isn’t on my carrier it is a no-go, multiple line family plan, can’t change everyone over for my new toy.
2. a. Quality
4. looks, etc.
Samsung phones are available everywhere on all networks/carriers, retailers and online. Moto X however will only be subsidized when brought through the Play Store and retailers will likely charge a premium for it (like the Nexus 4 in Europe). I’m sure its a great phone, but Google needs to find a better way to sell.
While that may be the case in Europe in the US the nexus 4 (only sold at TMO) only came with a small premium ($70). If Motorola can get this on all the Big 4 Sprint, ATT, and VZW will subsidize it as always (hiding the real premium they are charging from the user) and TMO will likely sell it at or very near the Play Store price. The Nexus 4 was held back by availability (limited stock + only on TMO) as long as motorola handles availability well this should go platinum (or w/e the phone equivalent is)
Honestly, Im not sure how the US system works. If I wanna buy a GS4 on Verizon, what do I do?
Well with the Big 4 there are 2 systems: the contract route and the TMO route. The “contract route” has you pay a small price for a phone (between free and $199) and you are locked into the contract for 2 years, the actual cost of your phone is hidden in your monthly charges. The TMO route works like an interest free credit card, you make a down payment and then monthly payments. While they are technically the same with TMO your monthly bill goes down after 2 years (unless you get a new device immediately after paying off your old one) with the other carriers it doesn’t
For contracts are the monthly charges arranged & fixed before you buy the phone or can carriers charge what they like? In the UK, if you want a contract phone you sometimes pay money upfront (depending on phone, retailer & carrier) and then you pay a fixed monthly fee, which normally includes a bundle of minutes, texts & data, phone cost and other costs networks take.
As for T-Mobile USA, I actually understand what you mean and see the appeal.
Yes, the companies are not allowed to violate your terms in the contract you signed. So if you started with a $90/500 mins, unlmtd data and texting, they can’t suddenly make it $120.
Thanks for the insight! Is there anything else Im missing regarding US contracts?
Outside of the fact that they suck I can’t think of anything else.
yeah motorola is more nimble
only available on verizon
shutting shop in Asia(china and india where 60 % of the world population resides)
leaving flagship devices with no update and locked bootloaders
and I can forgive that, but MotoBlur, never