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Motorola ROKR iTunes Phone may have flopped with six times the returns |
dancingfate
Joined: Sep 25, 2004
Posts: > 500
From: Jakarta, Indonesia
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Motorola's ITunes Phone Gets Off to `Rough Start'
Oct. 21 (Bloomberg) -- Motorola Inc.'s iTunes music phone, developed with Apple Computer Inc. and unveiled last month in front of an audience of more than 500, may have flopped.
As many as six times more customers are returning the Rokr phones than is normal for new handsets, according to American Technology Research analyst Albert Lin, who said he talked to distributors, retailers and call center workers at Cingular Wireless LLC, which sells the phone.
Motorola Chief Executive Officer Ed Zander said he is disappointed with the phone's marketing and plans to fix it.
"We got off to a little bit of a rough start,'' Zander said in an interview after Motorola reported on Oct. 18 that third-quarter profit tripled, driven by more-popular phones such as the Razr. "People were looking for an iPod and that's not what it is. We may have missed the marketing message there.''
Zander said the Schaumburg, Illinois-based company didn't make it clear enough that the Rokr stores fewer songs than an iPod. The phone holds 100 songs and costs $249.99 with a two-year contract from Cingular. The iPod Nano, introduced the same day, holds 1,000 songs and costs about the same.
The response to the phone blemished an otherwise better- than-expected earnings report from Motorola, the world's No. 2 mobile-phone maker.
"There's an overall disappointment with the product,'' said Lin, based in San Francisco. He rates Motorola shares "buy'' and said he doesn't own the stock.
'Compatibility Bugs'
Apple CEO Steve Jobs unveiled the phone Sept. 7 from the stage of the Moscone Center in San Francisco after 15 months in development. Pop singer Madonna joined in the introduction via telecast from London.
Madonna is also featured in a television ad for the Rokr. She's crammed into a phone booth with musicians such as Little Richard and an actor portraying Beethoven. She shouts ``Biggie! No!'' when the late rapper Notorious B.I.G. approaches the booth. As the commercial ends, a voice-over intones, ``A hundred tunes in your phone, baby.''
Apple, on its Web site, advertises that the firm's iTunes software can link to the phone. The program has "compatibility bugs,'' Lin said.
On the Cupertino, California-based company's online discussion boards about the Rokr, the longest discussion among more than 70 topics concerned how to synchronize the Rokr with an existing iTunes account on a personal computer.
Less Inspiring?
Motorola sold 250,000 iTunes phones in the weeks it was on sale last quarter, or about 83,000 a week. About 6.5 million Razr phones were sold during the entire quarter, or about 500,000 a week. Lin said Rokr's sales matched estimates, though the high rate of customers returning the phone means it won't be a ``superstar product.''
"The Rokr is performing equal or better to any product launch and I don't have anything that would corroborate'' higher returns, said Alan Buddendeck, a Motorola spokesman.
Mark Siegel, a spokesman for Cingular, the biggest U.S. mobile-phone service provider and the only U.S. carrier sells the iTunes model, said the company is ``satisfied with the results of the sales.'' Apple spokesman Steve Dowling declined to comment.
"There's a difference in the marketplace around the world,'' Buddendeck said. "The U.S. is very familiar with the iPod and the reviewing audience was unfairly comparing it to the iPod.'' Zander said the Rokr phones are selling better in Europe and Asia.
Pink Razr Coming
The iTunes phone failed to inspire buyers in the same way as the Razr, Motorola's previous new product, analysts said. The company has sold 12 million Razrs since the introduction last year. The phone accounted for 17 percent of its 38.7 million handsets sold last quarter, Ron Garriques, president of Motorola's mobile-devices unit, said in an interview.
Demand for Razr helped Motorola's net income jump to $1.75 billion, or 69 cents a share. Revenue rose 26 percent to $9.42 billion, beating analysts' estimates.
Zander this year added an all-black Razr. Former Wimbledon champion Maria Sharapova, who endorses Motorola, requested an all-pink version for herself. Zander, 58, plans to sell a similar version to consumers by the end of the year.
Motorola shares fell 19 cents to $20.70 at 4 p.m. in New York Stock Exchange composite trading. Apple dropped 48 cents to $55.66 on the Nasdaq Stock Market. Cingular, based in Atlanta, is owned by SBC Communications Inc. and BellSouth Corp.
'Small Subset'
The iTunes phone is only one of Motorola's music-focused phones, Zander said. The company next year will roll out a new service dubbed iRadio that will allow subscribers to wirelessly transfer music from a home entertainment system to a cell phone or a car stereo.
"iTunes is a small subset of Motorola's music strategy,'' Lin said. "As far as their financial focus, they're much more interested in other devices, and by the end of the year, it's iRadio that's going to be front and center.''
Apple has sold more than 600 million songs through its iTunes store and more than 10 million users have iTunes accounts. That's still a big target market, Zander said. Some analysts are skeptical about the company's ability to reach those users.
"Beyond the flash of the iPod name and the newly proud Motorola marketing machine, you'd be hard-pressed to say the Rokr is a good product,'' said Paul Sagawa, an analyst with Sanford C. Bernstein & Co. in New York. He rates Motorola shares "market perform'' and said he doesn't own them.
Link:
http://www.bloomberg.com/apps[....]ltTesg0vE&refer=top_world_news
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hotcha
Joined: Apr 08, 2005
Posts: 93
From: bristol
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I think the N91 has the ROKR schooled. 100 song limit? Why? And I hear the N91 has wifi. Can't believe Apple bungled this one. |
batesie
Joined: Feb 13, 2004
Posts: > 500
From: London, UK
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woops! unlucky apple
[addsig] |
goldenface
Joined: Dec 17, 2003
Posts: > 500
From: Liverpool City Centre
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This has long been predicted. The Rokr simply does not and will not have the desirability of an ipod. The W800 comes out better in comparisons especially when you take into account the 100 song limit!
It has been said that operators are not keen on the phone either as this phone will not allow them to rake in revenue from music downloads, unlike other phones in the same class!!
It other words, it doesn't seem to have found its niche.
The new iMode phone from NEC (for O2) looks more iPoddy than the ROKR.
It would seem that this campaign has been badly thought out and badly executed by Moto/Apple.
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[ This Message was edited by: goldenface on 2005-11-01 15:10 ] |
GBrent
Joined: Feb 07, 2005
Posts: 22
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100 Songs, what were they thinking of!! Especially with the N91 with 4Gb HD soon to come out. It makes no sense whatsoever. |
Chazzer3
Joined: Mar 23, 2004
Posts: > 500
From: Edinburgh, UK
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The biggest flop ever. I cannot believe that apple would ever make such a big mistake, I mean. Wow.
Charlie -
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goldenface
Joined: Dec 17, 2003
Posts: > 500
From: Liverpool City Centre
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Exactly. Missed opportunity! Some say they were frightened of stealing sales from the iRod mini but if it all goes to the same company. . .
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hotcha
Joined: Apr 08, 2005
Posts: 93
From: bristol
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I heard that Apple deliberately sabatoged the ROKR because they didn't want to dent iPod sales. Sort of makes sense to me now.
And if it is true that Nokia is slow to release the N91 because of DRM sortings, lets just hope they get it all right. Supposedly decent battery life even, and may even come with extra battery? Anyone have anything on that?
You are right about the other phone looking more iPod than the ROKR  Nice spot. |
floatlite
Joined: Jan 23, 2002
Posts: 486
From: Glasgow
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Apple had no direct input into the Rokr, other than providing the rights to use iTunes, and providing a spec for the use of said.
It's Motorola that's dropped the ball if anyone has,and btw, the phone is actually ok.
David |
goldenface
Joined: Dec 17, 2003
Posts: > 500
From: Liverpool City Centre
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Yes but! The W8 wipes the floor with it! Madonna or not, the ROKR has bombed!
Wasted opportunity by Moto, big time. That is unless they have something else up their sleeve  .
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[ This Message was edited by: Goldenface on 2005-11-14 05:01 ]
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N56
Joined: Jul 21, 2005
Posts: 50
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Quote:
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On 2005-11-14 01:51:37, hotcha wrote:
Supposedly decent battery life even, and may even come with extra battery? Anyone have anything on that?
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yeah ii hear it comes with 2 batteries. u can pick them up pretty cheap anyway tbh |
JiggyJaggy
Joined: May 21, 2002
Posts: > 500
From: London, UK
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Its simple, they took an old model of motorola with an un-user friendly menu and stuck a limited version of itunes on it.
what did they expect? I have sat here laughing at that articel, pure school boy error.
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Posted: 2005-10-26 09:28
