Market share mayhem
A two-way pager. A digital handset. A clamshell phone. A camera phone. All fine devices, and all devices whose introductions-and delays-have the power to change the fortunes of the companies that produce them.
One misstep and it seems the analysts, media and investment community are ready to write you off.
Motorola, the No. 2 player in wireless devices, used to be called an 800-pound gorilla. Motorola owned the paging market, single-handedly built the SMR market and even owned SMR licenses to help develop that market. And then the company failed to anticipate how quickly cell-phone customers would migrate from analog technology to digital technology. And then the paging industry shriveled up, in part because of the success of the cell phone. And the two-way paging industry never got off the ground to the chagrin of its backers. Meanwhile, its CEO was talking about biometrics at one point. (I still don’t understand what was up with that!)
More recently, critics have kvetched about Motorola’s delays in bringing a camera phone to market. It finally delivered last week with a camera phone sold through Verizon Wireless.
Despite all those significant problems, Motorola still clings to the No. 2 position in handset manufacturing, although no one calls the company a gorilla any more.
Earlier this year, the nearly god-like Nokia-a company that at one point held nearly 40 percent of the handset market-admitted to making a few mistakes in handset sales-like no clamshell phone. Its punishment was swift and severe. And when the company offered its second-quarter financials earlier this month, its stock dropped to near its 52-week low, even as the handset manufacturer maintains a 32-percent market share.
Early on in its joint-venture relationship, Sony Ericsson so struggled that questions regularly popped up about whether Sony and Ericsson would continue to fund the venture. Eventually Sony Ericsson conceded the North American CDMA market to competitors, further casting doubt on the handset manufacturer. Today the company has climbed back to the No. 5 position and is enjoying some profits.
While it seems no one is invincible in the handset business, history also points out that stumbles can be that, merely stumbles.
