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But the wildly popular Razr and the new Q, due to go on sale Thursday, have turned the Schaumberg, Ill.-based company from a provider of plain-vanilla phones into one of the leading figures in handset design.
The company is also trying to carve out a spot in home automation and videoconferencing.
Responsibility for a good part of the turnaround belongs to Ed Zander. The former chief operating officer at Sun Microsystems landed at Motorola in late 2003 as CEO. Motorola was already contemplating spinning off its chip division and taking other actions to right itself, but Zander oversaw the process. The Brooklyn, N.Y.-born executive is also known for his ability to cut deals with partners such as Apple Computer. Not everything has worked--a brief dalliance in LCD TVs fell flat--but overall, the company seems to have momentum.
Zander recently sat down with editors from News.com, CNET.com and ZDNet News to discuss the Q, tell tales of dealing with Apple CEO Steve Jobs and show off the movies he watches on his phone.
You've been CEO at Motorola about two-and-a-half
years. Why don't you give us the highlights and some of the stuff you have
left to accomplish?
Ed Zander: We've had some good quarters and done some
good things, but we still have a long way to go to being a high-performance
leader, which we have been in the past. The good news for the company, for the
employees, is that we are winning again. We've gotten some good products out the
door. Our financials have been--for nine quarters--really pretty good. We gained
market share in many of our markets. We still have to continue to drive
innovation and drive customers' sat (satisfaction) to higher levels, and improve
our earnings and the quality of earnings--but at least we're moving in the right
direction.
In the U.S., people still look at a mobile devices as a cell phone. There
might be some pictures on it, but it's mostly a phone. Is that going to change?
Zander: If I want market research, I go outside the U.S. I go crazy here
sometimes. Yet I look at my son. He's in his late 20s. He has been a technology
kid for many, many years. He uses
his Razr; he does pictures; he does Internet access; he does a lot of text
messaging; and so he is using more than just doing phone calls.
We're introducing the Q, which is going to be a bridge device that not only does your office mail, but does video.
We've had a restriction of the network--the pipes haven't been that big here in the U.S., while they have been in Europe, in Korea, Japan and other places. As Verizon, Cingular, and T-Mobile and Sprint begin to bring these pipes up, I think you're going to see more services and more applications delivered over the Net.
The Q is kind of an odd product. I mean, it's very BlackBerry-like, but
you also have a lot of consumer elements in it.
Zander: I'm trying to
figure out who to aim these things for and what to call it. It has incredible
mail, calendar--the entire Microsoft Outlook experience. Yet it's got a phone
that really can make phone calls, unlike the other competing partners, where you
need two devices. I mean, this does good if not better RF (radio frequency)
quality than some of my traditional products.
We also threw in full MP3 stereo audio and some incredible MPEG capability on video. So who is it aimed for? Well, for the enterprise customers like myself--I've been using this for four months, and it's my mail now, it's my PC on the go. Yet I do have pictures of my kids, I do take some videos off of a PC and watch things on it.
I think we're going to find interesting applications for it. I'm not sure where this whole thing goes, but we've got a kind of convergence device here.
When you talk about docking the Q and using it as a DVR, how do you
resolve the DRM (digital rights management) differences in that world? There is
DRM that's coming across the cable operators' networks. There is the DRM of
mobile phone operators' networks. These things are compatible, on top of which
there is iTunes, which has its own form of DRM.
Zander: Well, if we sit
back and don't get people to talk and work together, it will self-destruct and
people will only make phone calls on these things. The cable guys are getting
together, for example, with Sprint. So, you're able now to deal at least with
the wire line, the wireless, the cable guys together in a room. The other thing
is bringing in content players, and the cable guys have a lot of experience with
content players.
Are we going to have one (DRM scheme)? No. But I think it's going to be a small number of them. We've got the Microsoft DRM now in a lot of our technology, and we're working with some of the music players.
I think the music experience has left a bad taste in a lot of people's mouths, because for 99 cents, the people that have made money are with MP3 player companies. The hardware guys made the money, and the guys that owned the content made nothing, and it should be inverted, right? So, I think there is a rethinking in that of how you get dollars monetized on great content.
What about Net neutrality? I mean we heard T-Mobile recently saying, "From
now on we're going to prevent voice over IP on our pipes, we are going to
prevent instant messaging."
Zander: There are different opinions on that,
and I try to stay neutral on Net neutrality. Maybe if Ed Zander wants to drive
the more high-performance car, or wants to have an unbelievable experience,
maybe he pays more than someone who just might want to run a network for regular
data and voice and whatever.
I don't know what the right answer is. I can see both sides of it. I'm big on...keeping things open. Having said that, the Verizons have spent billions of dollars in basically building the Interstate Highway System. Wireless guys say, "Look, I'm ponying up here and doing all the heavy deals, laying all the concrete. I just want to get paid for it."
Couldn't that drive prices up?
Zander: No, because the more people
we get on it using video, that could drive costs down. You may have a price
inflection for a while, but then it starts driving you down, as it did on the
Internet, as it did in PCs.
Speaking of the pipe issue, you're a pretty big supporter of WiMax. You'd
think the carriers wouldn't exactly like the idea of WiMax. They've put a lot of
money into their pipes, they've got 3G.
Zander: That's a real tough
question. I just don't bet against technology. Never. WiMax
is coming whether you want it, like it or don't like it.
There are countries in the world that already have procurements for nationwide WiMax--I think Pakistan is one of them--and a few others in Eastern Europe that are saying, "I can't
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