Motorola Ships 250,000 Xooms, Delays LTE Products - InformationWeek

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4/29/2011
12:54 PM
Eric Zeman
Eric Zeman
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Motorola Ships 250,000 Xooms, Delays LTE Products

Motorola Mobility reported a first quarter loss of $81 million on revenue of $3.0 billion, an improvement from a year ago when it lost $212 million.

Motorola Mobility announced its 2011 first quarter earnings on Thursday, and the news was not quite terrible. The company narrowed its loss to $81 million on revenue of $3.0 billion. Motorola lost $212 million in the year-ago quarter. It's good to see Motorola get a grip on its balance sheet after suffering through years of losses. Motorola Mobility was born in January of this year, after Motorola split into two separate companies. Motorola Mobility has two main divisions, mobile phones and cable set-top boxes.

The mobile device division accounted for $2.1 million in revenue, and Motorola says it shipped a total of 9.3 million devices, including 4.1 million smartphones and more than 250,000 Motorola Xoom tablets. By way of comparison, Motorola shipped 8.5 million mobile devices, including 2.3 million smartphones in the first quarter of 2010. That's a decent increase in terms of overall devices and smartphones sold.

Motorola pointed out its successful product launches during the quarter, which include the Motorola Atrix and its laptop dock accessory, the Xoom Android tablet, and three Android handsets for China. It also made a number of acquisitions and investments in mobile media delivery companies.

Clearly Motorola's definition for success differs from most others. The Atrix, while an all-around decent device, hasn't quite caught on. As one of the few Android-based smartphones to actually ship from Motorola this quarter, surely the company hoped the device would fare better. Apple rained on that parade, though, with the introduction of the Verizon iPhone 4. Analysts have termed Atrix sales "disappointing." It also didn't help that the Atrix launched without support for AT&T's faster upload network (HSUPA).

Motorola shipped 250,000 Xoom tablets. That means it stuffed the channel with a quarter million Android 3.0 Honeycomb tablets. Motorola didn't say how many were actually sold to end users, though. Estimates for the actual number of sales to real people have ranged from pathetic to disheartening. Even if Motorola sold all 250,000 Xooms, that figure pales in comparison to the 4.69 million iPad 2s that Apple sold during the last few weeks of March.

But Motorola CEO Sanjay Jha warned of some speed bumps ahead. Motorola was planning to make a Long Term Evolution wireless modem available for the Xoom tablet by the end of the first half. The upgrade, which will require Xoom users to send their devices to Verizon's labs for a week, will provide a significant boost in wireless broadband performance. Sadly, it's not going to happen by the end of the first half.

Worse, the only other significant handset Motorola has announced--the Droid Bionic for Verizon Wireless--also has been delayed. It was to launch in May, and now it's looking like it will be late summer before the Bionic arrives. Keep in mind, this device was announced at the Consumer Electronics Show back in January.

In an attempt to explain why these products are seeing delays, Jha said, "It was really a software issue of getting the performance to a place that both ourselves and our partner, Verizon Wireless, were comfortable launching the device[s]. As you understand, there's a great deal of complexity in launching any new technology like this--that was probably the main matter at heart here."

Are these delays the end of the world? No, they're not really. LTE is, as Jha said, a brand new wireless network and it takes time to refine performance of devices on new networks. Given the amazingly poor battery life exhibited by the initial crop of LTE-equipped devices on Verizon's network, it's safe to say that, in Motorola's case, LTE stands for Long Time Engineering.


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