Moto Ditches Symbian for Android & Windows

Motorola Inc. (NYSE: MOT) says it will dump the Symbian Ltd. operating system in favor of the Google (Nasdaq: GOOG) Android and Microsoft Corp. (Nasdaq: MSFT) Windows Mobile platforms in a bid to simplify its handset line-up in 2009.

The world's third largest phone vendor has been expected to introduce an Android phone in 2009 for a while. (See Motorola Preps Android Phone.) On the company's third-quarter earnings call this morning, Motorola's new co-CEO and handset unit head, Sanjay Jha, clarified that the firm intends to focus on just two platforms in the higher-tier market next year in a bid to further reduce costs and simplify its labyrinthine cellphone offerings. (See Motorola Delays Devices Unit Spinoff and Moto Reports Q3.)

"We will no longer offer new devices on Symbian UIQ [Moto's version of the Symbian OS] and our internally developed Linux-Java platform," Jha said. "Our first Android platform is targeted to be on the market for the holiday season 2009.

"There's just too much complexity in our operating systems and unit platforms," he told listeners on the conference call.

The dumping of the Symbian platform in 2009 will mean more pain in the short-term for the Moto device team, Jha said, particuarly because it won't be launching Symbian devices it expected to in 2009.

"There is no quick fix here," said Jha. "The first half of next year will be challenging, fewer devices will be released than expected."

The handset boss is predicting fourth-quarter handset revenues and unit shipments to be down compared to the third quarter. The moves to simplify, however, will help to further reduce costs by $600 million in 2009, Jha said.

Analysts on the call questioned whether Android and Windows handsets would give Motorola much to offer in the middle of the market as it transitions from Symbian and home-grown offerings. Jha says that both Google and Microsoft are working, along with Motorola, to make their platforms more of a mass-market play in the coming years.

"We certainly plan a large number of Android devices over time," Jha elucidated. "In 2010 I think they will both address much larger tiers of the market."

Motorola is also simplifying its chip-suppliers. It will focus on Qualcomm Inc. (Nasdaq: QCOM) and Texas Instruments Inc. (NYSE: TXN) for 3G UMTS chipsets, the big Q is already Moto's CDMA supplier.

Jha says that Moto will farm out manufacture of 2G low-end phones to original device manufacturers (ODMs) but keep at least some of its more cost-effective 3G product line in-house.

He says that Motorola will focus on sales in North and South America and "parts of Asia" in 2009, while telling analysts on the call that the vendor will still sell into Europe. This reflects where Motorola already is in third-quarter sales terms. Motorola's 8.4 percent market share was made up of 50 percent North American sales, 23 percent South of the border, with Asia and Europe making up the rest.

— Dan Jones, Site Editor, Unstrung