Motorola Big Bet on sub-$50 phones

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Motorola is betting big on the sub $50 phones in order to achieve growth, profits and market share in the hot markets like India, China and South East Asia, according to a report inWall Street Journal. “Please do not confuse low price with profitability,” Motorola CEO Ed Zander said. “We know that we can make money on these devices….We can be profitable [and] we can grow market share.” The question is when? Still it will clearly help company regain some market share, just like it did for Nokia. I think the sub-$50 phone is going to be a big business, but will volumes compensate for razor thin margins?

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Yuri Ammosov

I won’t worry much – Motorola will get it money from mobile carriers. Back in Feb 05, on 3GSM in Cannes everyone seemed to be talking about going after India, Africa and other places and how cheap phones (below $30 to make) were cruccial to this task. See, ARPU is stagnant so mobile ops have basically no other choice left – they got to serve the poor of the world to keep revenues rising, if only by a hair.

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