(Updated) Report: Lenovo Mobile to be dissolved and sell all phones under the Motorola branding
“Effective immediately, Rick Osterloh, formerly president, Motorola, will be the leader of the combined global smartphone business unit, which will be under Motorola legal entities…[Lenovo’s Mobile Business Group] will continue to drive Lenovo’s overall mobile business, but will now rely on Motorola to design, develop and manufacture smartphone products,” the statement added.
In addition, with respect to the ZUK brand, Engadget received the following statement from Lenovo: “No doubt ZUK will keep going (as is) in the future, because (it’s) independent of Lenovo group.”
This would, seemingly, clear up the issue as to what will happen with Lenovo’s spin-off brand, though it does appear as if a final decision has yet to be reached as to what will ultimately occur.
With tough markets and results that missed expectations, Lenovo is taking broad, decisive actions to realign businesses, cut costs and return to sustainable, profitable growth. Specifically, Lenovo is restructuring its Mobile Business Group (MBG) to align smartphone development, production and manufacturing and better leverage the complementary strengths of Lenovo and Motorola to quickly drive growth. To create a faster, leaner business model we will leverage our global sales force across Lenovo, and will accelerate the work already well underway to maximize efficiency in our global supply chain.
Lenovo’s new organization eliminates duplication, and positions us to compete as a strong player in the smartphone market. MBG will continue to drive Lenovo’s overall mobile business, but will now rely on Motorola to design, develop and manufacture smartphone products. Effective immediately, Rick Osterloh, formerly president, Motorola, will be the leader of the combined global smartphone business unit, which will be under Motorola legal entities. Osterloh will continue to report to Chen Xudong, senior vice president, and president, MBG.
Original post: When word broke that Lenovo would be purchasing Motorola from its former owner, there was a bit of shock, a bit of awe, and a bit of business-as-usual. It had long been asserted that Google purchased the company largely for its patents and more advanced research projects, and despite the favorable reception to products such as the Moto X, Moto G, and Moto E, the acquisition wasn’t exactly bringing home the bacon.
While Western markets might be largely unaware of Lenovo’s presence in the smartphone industry, it has been an established player for some time. Still, much as how ZTE initially chose to hide its branding on the Axon Phone, so too has Lenovo -arguably- needed a way to make the global market feel comforted and at-ease with its products.
One brand to rule (them both)
The solution now seems to be clear: a report from Xiaomi Times indicates Lenovo will soon dissolve its own smartphone branding, instead leaving everything to Motorola’s doings. Specifically, according to Lenovo Mobile Group President Chen Xudong, Lenovo Mobile will eventually be merged into Motorola. “The new organizational structure will be immediately released,” said the SEO in an interview with Interface News.
The decision was allegedly in planning for about a year, with the main problem having been trying to decide the best way to manage two separate companies that were, essentially, doing the same thing. Most of the management will apparently be comprised of Motorola staff, though Lenovo CEO Yang Yuanqing will still be calling all the shots.
Due to English-grammar related issues in the source report, it is unclear as to what will happen to the Zuk brand. A dual-branding is mentioned, with the idea that the it will become the company’s “flagship Internet brand” which might indicate it will be sold exclusively in key Asian territories online-only, and the Motorola branding will thus be used for all other devices sold in outside markets.
Digital Trends has a slightly clearer interpretation, suggesting that “Lenovo’s high-end mobile brand Zuk will also merge into Motorola, even though the Zuk Z1 gained more than two million pre-orders. We expect Zuk will continue to sell devices online even with the change in management, as it competes against Xiaomi and OnePlus in the growing online-only market.”
What would it mean for Motorola?
On paper, this is a great idea. Lenovo has some fantastic looking devices, though as a company it lacks the smartphone brand-awareness that would otherwise help it to be successful in the global market. Motorola in turn, has a very solid product line-up, but has only a sparse three or four offerings to choose from: those looking for anything outside the box have previously needed to resort to other OEMs to meet their demands.
In practice, only time will tell what kind of results occur. If Motorola will indeed be responsible for all development, this could mean some of Lenovo’s more creative products such as the Vibe Shot or dual-selfie Vibe S1 will be the last of their kind. Motorola, as it exists today, has a singular design language going on with its products, and has been using it for the last few years now. (Of course there are off-shoots like the Droid Turbo/Moto Maxx). Will this result in “Lenovo phones” being forced to confirm? Or could it mean that Motorola products will begin to evolve and differentiate?
As Digital Trends also makes note of, the Motorola brand has not been as successful in Asia as Lenovo’s, and thus the former will have a sizable task in trying to decide just what to do with the products that have already been established.
There is also the issue of tablets, namely in terms of what Lenovo will opt to do with them. Will Android devices be turned over to Motorola as well? Will they continue to be developed separately by Lenovo? While the former would see the return of Motorola to the tablet world, the latter might result in some device overlap or inconsistencies.
Suffice to say, there are a lot of exciting prospects at hand for this new stage, and we look forward to seeing what potential products are produced.
Despite the more concrete nature of this report given it was allegedly based on an interview, it should be noted that we advise our readers to approach the issue with some skepticism: The idea of Lenovo Mobile being folded into Motorola is a big issue. A very big one. Given that all current mentions of this story cite the same original post, Xiaomi Times, we must ask why it is Lenovo itself has not issued an official Press Release to provide the information. There could have been a bad translation somewhere, for example.
Alternatively, this could be a solid fact in China and the issue is simply that an official English-language Press Release or formal announcement has yet to be made. We will update this story in the event there are any further developments or official corporate confirmation.
At the very least, given Lenovo’s poor Q2 2015 performance results and potential for subsequent layoff announcements at Motorola, a more streamlined approach to its management and handling of the mobile market is definitely a good idea.
Let’s hear it!
What are your thoughts on the potential folding of Lenovo Mobile into the Motorola branding? Have you owned a Lenovo smartphone? Are you worried about what it might mean for Motorola products? Do you still regret Google’s sale? Please feel free to vote in the poll below, and leave us your comments and let us know!