November 14, 2013
With New Low-End Moto G, Google Hopes To Shake Up The Smartphone Market
Peter Suciu for redOrbit.com – Your Universe Online
Google istrying to take on both ends of the spectrum in smartphones. In October the company released its Nexus 5, a top-end handset built by partner LG Electronics. Now it's looking to go after the entry-level end of the market with the Moto G, which costs just $179 – a low price for a smartphone that can be bought unlocked and contract-free.
Unlike many other smartphones, the Moto G can be moved from one carrier to another simply by adding a SIM card and thus avoid the usual two-year contract. It could be a game changer in the smartphone market.
“The Moto G is that less expansive smartphone that many people have wanted,” Jeff Kagan, telecommunication industry analyst, told redOrbit. “The last five years were all about selling the top of the line, most expensive smartphones. The next five years are going to be about selling less expensive devices to a new wave of consumers.”
To that end the device is aimed at emerging markets, where high-end handsets are typically out of reach for many consumers.
“This is for those who couldn’t afford a smartphone and it allows them to get the smartphone experience,” Kagan added. “As a result the universe of smartphone customers will explode.”
It could also be enough to turn around a trend that has plagued many handset makers the last couple years, Kagan noted.
“The growth in the market has slowed, but now with the less expensive devices it should crank up the growth again. This Motorola phone is initially aimed at other markets in the developing world, but it could be just as popular in the United States as we have customers looking for less expensive phones as well.”
Apple had tried to crack this market, but its lower-priced iPhone 5c was only $100 cheaper than its more expensive flagship 5s models. By comparison, even the higher end of the low-end Moto G handset, which will include 16GB of memory, will be just $199.
The device is also not that far off the mark in other features. It will offer a 4.5-inch 720p display – just a bit smaller than the 4.7-inch screen on the Moto X. The Moto G will also feature a quad-core 1.2GHz snapdragon processor – compared with the 1.7GHz in the Moto X. Will most users even notice, and even if they do, will they care about the slightly smaller screen and slightly slower processor?
Most users probably won’t notice or care - but other phone makers just might.
“We think the industry should deliver more value for the consumers’ dollar. We think people deserve better,” Motorola CEO Dennis Woodside said in a press event in São Paulo, Brazil – an emerging market where the Moto G could do especially well.
“That's what this phone is able to do, attract a new audience,” said Kagan. “It will allow Google to sell to a variety of different customers and this will force Apple to do the same thing.”
Where things might get a little more interesting is in how LG – the aforementioned maker of the Nexus 5 – and notably Samsung, the company that is now Apple’s biggest handset rival, will react.
“Samsung has already gotten their feathers ruffled, as they now have to compete with Google,” Kagan noted. “Google had gotten so much push back when they first came out with Android. They quietly exited the market for a while as they needed other companies to use Android.”
“Now they are jumping back in with their own handsets and these could target new customers,” he suggested. “Google will now be competing with Samsung and LG and the others, and those companies won’t like that. It puts Google on dangerous ground; it puts them in a dangerous minefield that they are tip-toeing in.”