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Summary:

Dell Computer, a Round Rock, Texas–based computer maker, is looking to enter the smartphone market and is currently toying with phones based on Google’s Android and Microsoft’s Windows Mobile operating systems, reports the Wall Street Journal. The news confirms rumors first reported last January. Michael Dell, […]

Dell Computer, a Round Rock, Texas–based computer maker, is looking to enter the smartphone market and is currently toying with phones based on Google’s Android and Microsoft’s Windows Mobile operating systems, reports the Wall Street Journal. The news confirms rumors first reported last January. Michael Dell, the CEO and founder of Dell, went on to drop some mobile-related hints in an interview with me in July 2008.

When I asked him about the possibility of his company going after the smartphone market — commodity hardware platforms married to industry standard operating systems are Dell’s business -– he danced around the issue. “What you’ve got [are] industry-standard platforms upon which applications are being built and ecosystems are being created, and that kind of building-block architecture gives us all sorts of opportunities,” he said. Given the sharp growth in non-PC devices like smartphones and netbooks, I’m not at all surprised that Dell is chasing both those markets.

The Journal says that of the two models under development, one is a touchscreen phone, while another phone will have a slider that hides beneath the screen. Normally I would dismiss Dell’s entry into the business, mostly because it has a botched history of diversification into new categories. It released digital music players and personal digital assistants, for example, but failed to make any real impact in either of those markets.

Dell bought Zing with grand ambitions that are still unrealized. The company, which has been losing market share in the PC business, isn’t quite consumer-friendly and responds to shrinking profits by shuffling the proverbial chairs. It has serious challenges and given that the phone is not likely to show up for a few quarters, Dell’s troubles are far from being over.

Still, the presence of Ron Garriques, former head of the mobile phone business at Motorola, is a good enough reason to believe that Dell might actually be able to pull it off. Motorola released RAZR during his tenure, but has since failed to come up with more winners. Garriques had a non-compete clause with Motorola that ends next month. John Thode, another Motorola executive, has been leading the mobile handset efforts, the WSJ reports.

Some are speculating that the new Dell phone(s) will be called the MePhones. Not very likely…but I would settle for that moniker as long the device(s) are anything but me-too phone(s).

  1. I don’t think that Dell should enter this smart phone market unless they want everybody to LOL on them. Dell should enter only if it has some “killer ideas” (which I don’t think it has) and should not enter for the sake of entering because the market is big and has opportunities ..blah blah blah….I don’t know why these companies don’t stick to their roots want to bring out something without polishing it..take for instance RIM’ Storm, or other touch based phone by samsung or LG and even HTC’s G1 (with not-so-good hardware) are all the examples of desparate companies trying to dethrone Apple in their dreams. I know once a reporter asked Steve that why don’t you create a search engine of your’s ..and he rightly said that Google is good at making one and let them make (means Google.com is already there)….one mature management decision I should say.

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  2. [...] Me Too: Dell Joins Smart Phone Gang [...]

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  3. thats great the more the competition the better for the customers !!

    bring it on michael, lets hope you predict apple’s moves better this time around…

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  4. Dell is going nowhere its main rival HP is preparing a salvo its already teamed up with software giant Oracle to deliver the most powerful machine on this planet. Change direction unbundle focus go for the hardware HP is on rampage.

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  5. For Dell to succeed in this competitive market it must sell in volume AND with high enough margins to sustain momentum and growth. At this point, it’s way too late for Dell, as this would explain:

    Fallacy of volume and revenue: The iPhone difference
    http://counternotions.com/2009/01/30/revenue/

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  6. Head Scratcher Friday, January 30, 2009

    Why would Dell want to buy Palm (for something like $2 billion!) when Palm gets its phones from ODMs, has gone proprietary on their next still-vaporware phone (the Pre), and Dell has been talking to ODMs for years?

    Some acquisitions really don’t make any sense at all.

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  7. Wait…Dell is counting on the guy who created only 1 successful phone in his lifetime, which also, outside of its design, has probably the crappiest software or interface on any phone?

    They may be successful, but Motorola holdovers are not going to be the reason why…

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  8. Agree w “addicted”. It takes a long time to build competency in handheld electronics.

    Apple and RIM have had over a decade to go through dozens of iterations and learn what works and what doesn’t. Even Palm, which was a market leader at one time, finds it hard to keep up. Look at Microsoft’s experience with Zune. (Shipments down by half [!] this year: http://www.podcastingnews.com/2009/01/23/zune-death-watch-microsoft-zune-revenues-plummet/)

    Sure, iPhone is only $175 in parts (http://www.alleyinsider.com/2009/1/blackberry-storm-isuppli) how hard can it be to put together a competitor? Very hard. I put long long odds against Dell on this one.

    – Shai

    http://www.twitter.com/shaiberger.

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  9. I guess Putin will not be buying one!

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  10. I’m not an Apple fanboi, but when they release a larger iPhone (iNewtown?), they’ll kill whatever else is out there — including my Android-based G1 which I very much love and rely on.

    Dell? Old news. There’s a problem that few people are talking about regarding smartphones. No, it isn’t the Apple patent. It isn’t the interface, necessarily. The biggest issue, and what will declare the next winner, is battery life.

    As we require more and more processing power, video capabilities, and network bandwidth, battery life is getting worse, not better. My Android running last.fm or imeem is horrid. My iPod Touch isn’t much better (no telcom network, though).

    The key to success for the next iteration of smartphones will be more than just interface and application market, it will be battery life. I have high hopes for the day when wireless power is readily available everywhere (Starbucks tables, desk at the office and home, car dashboard, etc). Until then, we’re not looking at Moore’s Law in smartphone capabilities.

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