Carphone and O2 in Motorola tie-up

Carphone and O2 in Motorola tie-up
Motorola’s comeback strategy will not start until the second half of next year and will involve an exclusive multi-handset alliance with just two partners, Mobile can reveal.

Senior executives at the US manufacturer plan to focus on a small number of countries in western Europe and narrow the company’s focus further on two key channels: Carphone Warehouse and O2.

The move has involved a reduction of the sales force in Europe, with no major product announcements until the run-up to Christmas next year.

A partnership has been struck with Carphone and O2 that covers its next series of four to five high-end handsets, extending throughout 2009 and into 2010.

It is believed the decision to go with O2 was borne out of the strong relationship Motorola has with Telefónica (O2’s parent company). Similarly, Motorola has placed great stock in the power Carphone has across Europe, especially after the retailer sold around 400,000 pink Motorola RAZR devices in the run-up to Christmas 2005.

Considerable investment has gone into Motorola’s comeback strategy and the handsets it hopes will resurrect the company are thought to include ‘exceptionally exciting’ devices, according to one senior buyer who has seen some of next year’s range.

Concern now centres on the reaction of networks and major retail partners that Motorola has excluded from its new strategy.

One major buyer said: ‘I don’t see the logic. If they make a nice phone, why restrict distribution? Looking at the products they’ve had so far, I’m not shaking in my boots if they exclude us from their plans.’

Another buyer said: ‘It’s very bizarre to alienate everyone other than Carphone and O2. And Q4 2009 is quite a long way ahead given how fast the landscape is changing.’

Building up the handset division for a £1.1bn sale or flotation is the stated target of the group, with a £1.8m bonus promised to Motorola group CEO Greg Brown in September 2008.
Written by Mobile Today
Mobile Today

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