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May 31, 2010

Sanjay Jha, co-CEO of Motorola Inc. says that differentiation is key to the company's long-term success and added that he is comfortable with earlier projections of twelve to fourteen new mobile devices this year.

Jha answered questions during a Q&A session at Barclays' Capital Conference in New York May 27.

He also added that he's pleased with the progress made in his time with Motorola. Aside from a complete reorg of the company, Motorola still managed to ship 2.3 million units last quarter and provided investors with some guidance that indicates profitability by the fourth quarter of this year.

When asked what he thought was important for Motorola going forward, he said that he's more than comfortable with the strength of the company's wireless devices and stressed that while the operating system is important it's not everything when it comes to differentiation from Motorola's many competitors.

Jha added "the operating system alone isn't what mobile users select a phone on, citing research that shows between 30 and 40 percent of the customer's buying process depends on the look and feel of the device, the overall features the device offers and the various functionalities that are built in."

When asked about whether he would consider an operating system exclusive to Motorola, he spoke in hypothetical terms. He said that if he could have an OS that includes a large and complete ecosystem of applications and services, such as Google offers with Android, an OS exclusive to Motorola might be of interest, without providing any specifics.

But he did say "nearly all of our focus is on Android right now."

However, perhaps what Wall Street is really concerned with right now is how Jha felt about the success of the HTC Android devices that are in direct competition with Motorola's Droid at Verizon Wireless.

The HTC Incredible is thought to be selling extremely well in Asia and Europe given recent reports that the company is experiencing a hiccup in production due to some component shortages.

But he was dismissive, saying Motorola is still very well positioned at Verizon Wireless. "This is probably the HTC redux for me, because when Nexus One came out, everyone said that Motorola was dead, and we survived, and I think it's possible that we will survive again. The quality of the devices that we're producing right now I'm very proud about," Jha added.

However, he declined to comment on recent reports from Verizon Wireless that Motorola would have a new entry to the Droid franchise by July 2010.

He also said that expansion into European and Chinese markets, as well as the company's portfolio of non-Droid products are important factors that will fit well into the Motorola's long-term growth.

But overall, there's no mistake that Jha's main focus is on differentiation from the competition.

He added that MotoBlur, the company's proprietary user interface, has done well in that way, noting that almost 88 percent of Motorola users are recommending the UI to friends and family.

Jha says that MotoBlur version 2 will soon be available in mid-October and will bring with it a number of new features and services.

Jha didn't clarify what those new features would be, however.

We will keep you posted.

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Source: Motorola Inc.