RIM will surge back to third place, but Motorola's a goner
Of three struggling mobile companies – RIM, Nokia, and Motorola – one will essentially die, one will take third place in the market, and one will keep on struggling.
Analyst Jack Gold made his predictions about the three companies in a recent report.
First, the company on its death bed: surprisingly, he thinks it's Motorola. The name may not disappear completely, but the trailblazing technology company that once was isn't coming back.
When Google bought Motorola, the search giant claimed it was primarily for the patent portfolio, which it wanted to protect all Android resellers against patent suits by other mobile competitors and trolls.
But Gold thought there was more to the acquisition. "Given the money Google spent, I assumed they were going to try to make Motorola a going concern so they wouldn't lose their shirts," Gold said. "That doesn't appear to be happening."
Rather than investing in Motorola, Google has cut expenditures. It has laid off thousands, fired others, and is reported to be closing down operations around the world. It also recently sold off the Motorola TV set top box business.
Gold envisions a couple possible scenarios for Motorola. It could suffer a slow decline over as long as five years, he said. Or, Google could sell the Motorola brand. He mentioned Huawei or ZTE as the kind of company that might be interested. "Someone without a brand that wants to get into the market," Gold said.
Among the survivors, RIM is most likely to step in place behind Android and iPhone among phone platforms, Gold said.
RIM is launching its first phones based on its new operating system early next year. A lot is known about the OS and Gold concludes it's unlikely to be a failure. He estimates that as much as 25 percent of the business market will stick with RIM over the next three years.
RIM also has the possibility to win back customers, Gold said. "A growing sense of displeasure by some past users of BB with other devices they adopted may help RIM succeed," he wrote in the report. A lot of people who switch to iPhone and Android devices miss the hard keyboard of a BlackBerry, he said.
Also, some switchers have complained about the instability of Android and iPhone compared to BlackBerry, he said. Still, it's hard to predict whether those complainers will indeed switch back to BlackBerry.
RIM has been losing market share to the iPhone and Android for some time now, and it is starting to lose active subscribers as well: in the company's earnings report yesterday, it said that subscribers had dropped to 79 million from 80 million in Q2. It sold 6.9 million new phones during the quarter, down from 7.4 million in Q2.
Finally, there's Nokia. Gold expects it to continue to take up the bulk of Windows Phone share globally. But its future is murky. "Nokia may be able to build on Windows 8 momentum (if it occurs) but it probably faces a longer term battle and success may not materialize for 2 to 3 years. Can it stay viable that long? Only time will tell," Gold wrote.
In an effort to create a somewhat consistent user experience across the phone, tablet, and desktop, Microsoft has forced the tile metaphor on the desktop and not done a terribly good job of implementing it. They're going to have to do a lot more than make cosmetic changes before Windows 8 is usable on a non-touch device.
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