Motorola's "Second Spring": The Road to Revival Under Lenovo's Support

Motorola's "Second Spring": The Road to Revival Under Lenovo's Support In 2005, the song "I Made Money" by Wu Cool Duo included lyrics about buying a Nokia with the left hand and a Motorola with the right after making money. At that time, Nokia and Motorola were the dominating forces in the mobile phone industry

Motorola's "Second Spring": The Road to Revival Under Lenovo's Support

In 2005, the song "I Made Money" by Wu Cool Duo included lyrics about buying a Nokia with the left hand and a Motorola with the right after making money. At that time, Nokia and Motorola were the dominating forces in the mobile phone industry. However, the arrival of the smartphone era witnessed the collapse of these once-mighty empires. Today, Nokia's smartphones have been significantly reduced in sales and are struggling to survive in the low-end market. But Motorola, after experiencing a period of decline, has been revitalised following its acquisition by Lenovo.

According to the latest report by TechInsights, a market research and technology analysis company, global smartphone shipments grew by 3.8% year-on-year to 307.7 million units in the third quarter of 2024. Among them, Lenovo-Motorola ranked seventh globally, with a 26% growth rate, leading the entire field and setting a new record for market share in the past decade. While Nokia, a fellow former industry giant, has all but disappeared from the smartphone scene, Motorola has achieved a resurgence in sales. What has enabled Motorola to reclaim its position at the top?

Lenovo's Backing: Opening the Door to Overseas Markets

Lenovo's acquisition of Motorola is comparable to Geely's acquisition of Volvo and SAIC's acquisition of MG, successfully opening up overseas markets for Motorola. Leveraging Motorola's influence, Lenovo-Motorola has achieved impressive sales figures in Latin America, Africa, the Middle East, and the Asia Pacific region. Specifically, it holds the third-largest market share (12%) in North America.

Lenovo-Motorola also ventured into Japan and acquired local mobile phone brand Fujitsu. Based on Fujitsu's influence in the Japanese market and Lenovo-Motorola's strength, Fujitsu has entered the top four in Japan's smartphone sales for the first time. The strategy of acquiring local brands in overseas markets and integrating them effectively allows for rapid brand recognition, reducing marketing time and expenses. Combined with Lenovo-Motorola's inherent technological prowess, opening up overseas markets becomes significantly easier.

Product Innovation: Embracing New Technologies

In terms of products, Lenovo-Motorola's foundation in the mobile phone industry might not match that of giants like Apple, Samsung, Xiaomi, OPPO, and vivo, but having experienced the painful transformation of the smartphone era, Motorola has been more receptive to new developments compared to most smartphone giants.

Take folding screen phones, for example. In 2019, when folding screen phones were a nascent technology, Lenovo-Motorola quickly followed suit, overcame the hinge challenges, and launched the vertical folding phone motorazr2019. For years, horizontal folding phones were the norm, with vertical folding phones remaining scarce and generally selling poorly. With technological advancements, vertical folding phones have gained increasing consumer acceptance, and in the third quarter, Xiaomi entered the top three domestic folding screen phone sales with its vertical folding phone MIXFlip. As a pioneer in the field, Lenovo-Motorola, through years of cultivation, now holds the top position in global vertical folding phone sales with a 30.8% market share in the second quarter of this year.

Today, motoS/X/G/razr and other series cover a wide range of price points and product types. Drawing on the technological prowess and influence of both Lenovo and Motorola, Motorola seems to be touching upon the hope of returning to its former glory. It currently holds fourth place in global sales, marking a significant milestone in Lenovo-Motorola's revitalization journey.

AI Empowerment: Building a Smart Ecosystem

The entire smartphone market is moving towards the AI era, and the industry is poised for another significant transformation. Seizing this opportunity is crucial for Motorola's future success.

Having witnessed multiple eras, including smartphones, 3G, 4G, and 5G, the mobile phone industry has now entered the AI era. Faced with numerous challenges in this new era, Lenovo-Motorola has promptly incorporated AI capabilities into its products. Take, for instance, the motorazr50UltraAI Yuanqi version. It features Lenovo Xiaotian, an AI assistant that can accurately recognize natural language, enabling the control of settings and applications. It can also assist with document writing, summarizing, polishing, and translation. Functions like AI painter, AI calls, and AI commuting can learn from user habits, calculate travel time, and summarize call content, enhancing work efficiency and convenience.

Furthermore, Motorola plans to expand its presence in AIPC, AI tablets, and AI headsets, enhancing the cross-platform and cross-device collaboration capabilities of smart devices, delivering a "multi-terminal in one" experience for users.

At Lenovo TechWorld 2024, Lenovo-Motorola revealed information about integrating Large Action Models (LAM) with motoAI. Based on this technology, Lenovo-Motorola's LAM will have the ability to learn user behavior and provide personalized interaction and assistance. Specifically, Lenovo-Motorola's phones, laptops, and other devices are already interconnected. PCs can access mobile apps, allowing for multi-screen operations and cross-terminal file transfer on the PC platform.

With the support of more devices and AI technologies, Lenovo-Motorola's AI assistant will become more intuitive, ultimately delivering an AI assistant tailored to user habits.

Compared to some of the leading mobile phone brands like OPPO and vivo, Motorola, with the support of Lenovo, actually has a more advantageous ecosystem, particularly in tablets and PCs, which are essential tools for work and study. These are areas where traditional mobile phone manufacturers lack brand influence and technological expertise. A full product line layout will be crucial for Motorola's mobile global market share to continue its ascent.

Global Layout: Opening Up Wider Markets

Market layout remains one of Motorola's strengths. Expanding beyond the Asian market is extremely challenging, with North America being even more difficult to penetrate. Motorola is one of the few brands that can seamlessly navigate the global market. In its US homeland, North America, Motorola's market share is already at 12%. With China as its base, Lenovo-Motorola can expand into Southeast Asia, South Asia, and the Middle East. From its US base, it can target Latin America and then move towards Europe. Lenovo-Motorola's potential for growth may be greater than that of other leading domestic mobile phone brands.

Looking to the Future: Hope of Returning to the Top

A company's resilience is measured not only by how high it can climb during its heyday but also by its ability to rise again after falling into a trough. Both Motorola and Nokia have experienced periods of both glory and decline. Today, Nokia's mobile phone business is beyond redemption, relying only on its patent technology and communication services to survive. However, Motorola, having risen from the ashes of adversity, has the opportunity to reach new heights again.

To reclaim its place in the spotlight, Motorola needs to double down on its efforts. According to statistics from Fortune magazine, 62% of US businesses have a lifespan of less than five years, with only 2% surviving for more than 50 years. But for entrepreneurs today, this data is still too optimistic. Before the 21st century, global technology and the economy were rapidly developing, with fewer major players hindering the growth of smaller businesses. Now, competition is fierce in every industry worldwide, with each giant aiming for a monopoly, making it more difficult for small and medium-sized enterprises to grow and thrive than before.

Starting a business is difficult, and ZTE is no exception. While Lenovo-Motorola's mobile phone sales rank seventh globally and its growth rate is at the forefront among the top ten brands, thanks to the influence of Lenovo and Motorola, it means that for Lenovo-Motorola to advance further, it needs to overcome giants like Samsung, Apple, Xiaomi, OPPO, vivo, and Transsion, the African king of smartphones.

Each of these leading mobile phone players has its own strengths. Even with the combined forces of veteran mobile phone manufacturer Motorola and PC manufacturer Lenovo, surpassing them is no easy feat. Fortunately, Lenovo-Motorola, with its market advantage, has greater potential for growth than other domestic brands. Following the acquisition of Fujitsu, Lenovo-Motorola is likely to target the Japanese market as well. The rigid Japanese market has always been considered an island in the smartphone industry. OPPO, Huawei, and other domestic brands have also entered Japan, but they haven't achieved much success yet. With Fujitsu as its "cover," Lenovo-Motorola has successfully climbed into the top four in the Japanese market, second only to Apple, Google, and Sharp. Leveraging the technology of Lenovo and Motorola, surpassing Sharp and Google in sales in Japan is within reach.

However, the mobile phone industry is fiercely competitive and subject to many variables. Whether Lenovo-Motorola can overcome these challenges and reclaim its position at the top remains to be seen.