Will Motorola stay on the road to victory in the smartphone market, or will the company be forever stuck in its ?peaks and valleys? pattern of success?

The RAZR line of Motorola phones was probably the most popular handset range in the feature phone era. Now, with its partnership with Verizon Wireless in the United States and Google?s Android operating system, Motorola might become a formidable force in the smartphone industry.

?You have to separate between smartphones and phones in general, said Noah Elkin, analyst at eMarketer, New York. ?Motorola has been increasing its share in smartphone shipments in the past four to six months.

?According to comScore figures, Motorola?s market share in the U.S. is pretty stable,? he said. ?Generally, allying with Android and focusing on smartphones has proven effective.?

Marketing muscle
The reason for Motorola's success is because Verizon is putting a lot of muscle behind marketing its line of Android-enabled smartphones to outpace rival carrier AT&T, which has an exclusivity agreement with Apple?s iPhone.

Google?s Android is now second to Research In Motion?s BlackBerry operating system, beating Apple?s iPhone in the No. 2 slot, per NPD Group research.

According to the company?s report, in order to compete with the iPhone, Verizon Wireless expanded its buy-one-get-one offer beyond RIM devices to include all its smartphones.

Based on unit sales to consumers last quarter, Android moved into second position at 28 percent, with RIM at 36 percent and Apple at 21 percent.   

?There?s no doubt that Motorola?s Droid devices are selling because of Verizon?s marketing,? Mr. Elkin said. ?The question is, will they be able to keep up the momentum.

?They have a long history of big successes and then peaks and valleys,? he said.

The answer is obvious. It depends on the quality of devices that Motorola brings to market.

Carrier support and partners are going to be key as well.

With the exception of the iPhone, there are few devices that are able to sell themselves. Marketing is a big factor.

That said, other manufacturers have managed to generate an increasing amount of excitement around their smartphones. So Motorola has a lot of work to do if it wants to stay on top of the smartphone market. 

The fact that Motorola was an early adopter of the Android OS is also a reason the company has been able to get back into the game.

?The Droid, Droid X and other Android smartphones has gotten them back in the game,? said Ross Rubin, director of industry analysis and consumer technology at NPD Group, New York. ?It?s been a relevant early adopter of the OS and has achieved brand awareness that other early adopters like HTC have not been able to match.?

Price-conscious consumers
Price is also a very important factor here. Verizon has promoted the Motorola Droid heavily and at a lower price than the iPhone and other high-end smartphones.

The iPhone has maintained a remarkable desirability and as much as consumers want it, they are price-sensitive. Motorola has proven that another smartphone with a lower price is something that can steer consumers away from the iPhone.

Smartphone sales at AT&T comprised nearly a third of the entire smartphone market with 32 percent, followed by Verizon with 30 percent, T-Mobile with 17 percent and Sprint with 15 percent, according to NPD.

Mobile advertising
The Android mobile platform is making big gains in global click-through rates as well, according to Smaato Inc.'s Mobile Advertising Metrics report for June.

The increase in click through rates on Android is obviously a result of the large number of devices that have come to market.

?Apple has changed the landscape for handset manufacturers that typically only focus on hardware,? said Paran Johar, chief marketing officer of Jumptap, New York. ?Motorola's clearly seeing the future opportunity within mobile advertising and content consumption as the Droid X's data consumption is 5 times that of Verizon's other smartphones.

?A logical next step you will see is how handset manufacturers like Motorola leverage this for the enormous mobile advertising potential,? he said.

Differentiators
Motorola is not the only handset manufacturer that is ramping up its smartphone strategy. HTC is also ramping up its investment and smartphone portfolio.

Motorola will need to find a way to differentiate itself. The industry thought it would be through Motoblur, a user interface developed over Android by Motorola for the manufacturer's mobile phones.

Motoblur is a widget-based system which combines various social networking portals such as Facebook, MySpace and Twitter all in one place without the need of logging into each service separately.

However, Motoblur has been stepped back in its latest iteration of the Droid X.

The original Motorola Droid was the centerpiece for Verizon?s push into Android devices. The Droid X represents the high-end of the Verizon smartphone portfolio in terms of features and specifications.

However, competition is growing and Verizon has a lot of competing Android devices. Which one is most appealing is becoming less clear.

?Motorola is indeed getting its mojo back, primarily by focusing on the smartphone market and relying on the Android platform to do so,? said Charles Golvin, principal analyst at Forrester Research, Cambridge, MA.

?It?s not an unmitigated success ? devices like the Droid and the just-released Droid X have driven greater sales, assisted by substantial marketing support from Verizon Wireless,? he said. ?However, the sales of less heavily promoted devices such as the T-Mobile Cliq and AT&T Backflip have been lower.

?With so many manufacturers now building Android devices ? Samsung, LG, HTC, SonyEricsson and Dell ? it remains to be seen whether Motorola can differentiate its products in the market.?

Joy Liuzzo, senior director of marketing and mobile research for Insight Express, Stamford, CT, said it is important to remember that Motorola may have lost its way for a bit, but at one point it had the most popular phone on the planet.  

Now, Motorola is approacing the smartphone market in a very strategic way.

"They didn?t make just one version and expect that it would work for everyone," Ms. Liuzzo said. "They introduced multiple models with different features, different price points, different looks and feels."

Motorola's strategy gives consumers various choices in deciding what works best for them.

Ms. Liuzzo said that the majority of growth that the industry is seeing in Android traffic can be attributed to Motorola. 

"When it comes to how Motorola Droid and X stack up against other smartphones, I don?t think anyone can offer a truly unbiased opinion," Ms. Liuzzo said. 

"Phones are so personal that consumers are going to make trade-offs depending on what is important to them and I know that what I value is probably not what other people value,"she said. 

"I will say that I have not encountered the ?perfect? smartphone yet." 

Final Take
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