China's Lenovo finally has the global smartphone presence it has craved, finalizing the purchase of Motorola Mobility from Google for $US2.91 billion.
Motorola's offerings in mature markets will complement Lenovo's growing smartphone presence in developing countries. Lenovo hopes to unseat the likes of Apple and Samsung, and has an ambitious goal of shipping 100 million devices, including PCs, tablets and smartphones, by the end of March next year.
Details of the joint product road map were shared in a Thursday press conference and these are some points that stood out.
No Motorola or Lenovo brands are being discontinued
Lenovo and its Motorola subsidiary will continue to distinguish their individual brands. Lenovo will target its products at emerging markets and Motorola products at mature markets. Both Motorola and Lenovo products are sold in some countries, such as India, and there are no plans to change that either.
Retaining brands is important to expand market presence until a long-term product strategy is devised, said Liu Jun, president of Lenovo's Mobile Business Group.
That could disappoint customers waiting for Lenovo brands like Vibe to reach U.S. shores. But availability and support of Lenovo and Motorola products will become easier with the distribution channels merging.
Motorola's stock Android strategy won't change
Motorola's Moto X, G and E smartphones are attractive because of their prices and the bloatware-free versions of Android that receive quick OS upgrades. Stock versions of Android were available thanks to Motorola being a part of Google and the Android strategy won't change with Lenovo.
"By going with stock Android we're giving customers the ability to choose," said Rick Osterloh, president of Motorola Mobility. "It's closely tied to the Motorola identity."
That is also good news for existing Moto smartphone owners and Motorola has said it would upgrade its newer smartphones to Android 5.0, code-named Lollipop, by the end of this year. Google's Nexus 6, built by Motorola, is also built on stock Android. The recent Droid Turbo has some bloatware, but uses a stock Android base.
Collaboration on research and development
Motorola's research and development resources will merge with Lenovo's, which could result in more feature-rich handsets under multiple brands. Motorola added 21-megapixel cameras to its Nexus 6 and Droid Turbo smartphones introduced this month, so it's possible Lenovo may put those features in its high-end Vibe smartphones. Motorola also has developed algorithms to adjust smartphone behavior based on background sounds, locations and user behavior, which Lenovo could bring to its smartphones.
Motorola customers shouldn't worry about product security
The U.S. government views some Chinese companies as security threats, but Lenovo has assured Motorola customers that user data will remain secure. Lenovo went through a stringent regulatory approval process in many countries before the acquisition was approved. Moreover, the company is transparent in its business activities, and has a solid track record of selling tablets and PCs worldwide, Lenovo executives said.
No benefit to tablets or ThinkPad PCs
While Motorola's acquisition will help expand Lenovo's global smartphone presence, it doesn't seem to immediately benefit the PC and tablet lines. Lenovo has done little to bring its smartphones closer to its popular tablets and PCs, and having a Motorola smartphone and ThinkPad PC will still feel like owning products from two different companies. Unlike Apple, Lenovo does not have app stores or a cohesive set of services customized for its mobile devices and PCs. Lenovo's focus remains on hardware, as opposed to software and services, and that won't change in the short term.