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Technology Stocks : Motorola (MOT) -- Ignore unavailable to you. Want to Upgrade?

To: posthumousone who wrote (771)	3/7/1998 10:06:00 AM
From: tero kuittinen	Read Replies (2) \| Respond to of 3436

Bedtime for Bonzo. After losing ground in Europe, North Africa, Near East, Australia, China and South East Asia, Motorola is now facing the biggest ever US product launches from Nokia and Ericsson in the digital phone market. Motorola was uncompetitive against the old phone models from those companies in 1997... I wouldn't rate its chances against the new models very high. In 1998, the US market is finally shifting from analog to digital, depriving Motorola its last real profit haven in mobile market. Ericsson is backing up its launch with the biggest ad campaign of its corporate history. The 788, 688, etc. are the models that boosted the company into 80% sales growth in handsets in 1997. Now the models are hitting America. Nokia is the preferred partner of ATT and the 6100 line of models has already received the best reviews ever from European press. There is not a single consumer review rating Motorola's digital phones above these competitors, with the possible exception of one upscale Startac model, which was priced at 1 100 US dollars the last time I looked. I think the 6100 (which is beating that Startac in surveys) will cost around 200 US$. I seriously doubt that the coming ragnarok in the US market is priced in the Mot stock value. After thoroughly botching the CDMA phone launch and getting some of the worst press of the recent years for its CDMA networks Motorola can hardly put much hope in patching up the TDMA/GSM fiasco with CDMA sales. If Ericsson's recent claim about slowing CDMA sales in Asia is really true, so much for worse. There are plenty of omens about Asia shifting its preference from CDMA to GSM because of its economic problems. Motorola gave up any hope of GSM technological leadership in favor of pumping up its CDMA R&D, hoping to outflank the European companies by this. Earlier this year it lost another standards battle by backing the losing Siemens/Alcatel proposition for the successor standard to GSM. If it turns out in 1998 that the bet on CDMA cost Mot the GSM market without giving it an equally robust business in return, any talk of turnaround will have to take place in 2001. Tero