Motorola, Others, Eye Mobile Broadband Beyond Cellphones
Motorola sees non-phone consumer devices as a potential gold mine, following service providers like Sprint Nextel that plan to connect gadgets beyond phones. The manufacturer plans to embed its WiMAX, HSPA and LTE data cards into consumer electronics, the company said Tuesday. For manufacturers looking to embrace embedded wireless business, certification and testing are critical, analysts said.
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Motorola envisioned embedded netbooks, portable gaming devices and other networked consumer electronics, putting its proprietary wireless technology in other equipment manufacturers’ products for the first time. A WiMAX network adapter and a dual-mode 3G adapter will be commercially available in Q3 with samples of a single-mode LTE card coming in Q4. Operators continue to upgrade their networks to offer higher speeds, meaning opportunities for service providers and manufacturers to roll out a wide range of low-power consumer electronics, Gary Koerper, vice president of Engine Systems for Motorola Mobile Devices, said.
Other device and equipment manufacturers were already on board. Nokia is eyeing netbooks while Qualcomm has been planning home computing devices that use its wireless chips. Google’s mobile platform Android was planned for markets like digital picture frames and set-top boxes. By 2014 there will be 100 million devices with 3G or 4G technology embedded in them, Strategy Analytics predicted. But the idea isn’t appealing to smartphone makers like Research In Motion. The BlackBerry maker will focus on its core business of phones, co-CEO Jim Balsillie has said. Though embedded wireless is still in its early stage, there are some success stories like the Amazon Kindle. The device will become a $1.2 billion business by 2010, Citigroup analyst Mark Mahaney estimated.
As manufacturers tap more wireless services beyond voice, certification becomes much more important due to potential interference and handoff requirements, said analyst Robert Syputa with research firm Maravedis. In WiMAX’s case, operators are still waiting for the tipping point that will lead to acceleration of WiMAX adoption and deployments, said Maravedis’ Adlane Fellah, stressing the key is certification. In-Stat’s Daryl Schoolar agreed, saying certification marks a significant moment in the maturation of emerging technology as devices move to actual production-quality products. The testing and certification procedure begins with standards bodies, then the device makers must ensure their products pass the FCC’s testing process before they can move to a carrier’s testing process.
Still, despite the embedded strategy, a turnaround for Motorola won’t happen anytime soon, Todd Koffman with Raymond James said. Analysts also began to rethink the wisdom behind a spinoff. If the company’s handset unit stands all alone, it’s not going to be well structured to survive, said Argus Research’s Jim Kelleher. Motorola saw a 46 percent drop in shipments year-over-year in Q1. But co-CEOs Sanjay Jha and Greg Brown said the company remains committed to selling off the handset division, which now accounts for just a third of the company’s overall revenue.