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Telecom Services V&D 100

Top10 Vendors: 3 - Motorola: On a Roll

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Voice&Data Bureau
New Update

Netting an increase of 174%, its revenue during FY '06-07 has galloped to Rs
4,050 crore from Rs 1,493 crore in the previous fiscal. The company revamped its
marketing and distribution strategy for handset sales, bringing new lease of
life to the handset devices range, bagging a couple of large telecom network
contracts from biggies. During the otherwise action-packed year, the company did
not make an attempt for any mega mergers, whereas its competitors gained because
of M&A deals too.

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Motorola, which is yet to give thumb down to its nearest rivals in India, has
improved on its mobile handset market share thanks to increased number of
handsets sales, and to the overwhelming growth in the telecom sector.

During the last fiscal Motorola revamped its handset strategy. It has opened
around 31,000 retail outlets for GSM and CDMA products in close to 250 towns.
For GSM it has partnered with Bharti Teletech for national distribution, and for
CDMA, it has tied up with Brightpoint. Motorola's product is also available with
all organized retail stores like Pantaloon Group's Convergem, Reliance Webstore,
Essar's Mobile Store, Subhiksha, Mobile Magic and Mobile Nxt. It has also worked
on the concept of exclusive stores and has opened 10 Motostores and 30
store-in-stores with plans to expand further. For reaching out to smaller towns,
Motorola has entered into alliances with ITC e-Choupal, DSCL Haryali stores,
Mobile ME, Kishan Bazar and Godrej Adhar. Motorola has tie-up with GE Money to
provide easy loans to handset buyers at 0% interest rates. On the care part, it
has 300 collection points and the turnaround time is around 48 hours. With this,
Motorola is expected to address a large part of the population. To push it
further Motorola has tied up with all the six service providers. And it has
introduced separate phones for each service provider.

Areas of operation:


Mobile Handsets, Wireless Infrastructure, Broadband

ADDRESS: Motorola India Private Limited Motorola Excellence Center,
415/2, Mehrauli, Gurgaon Road, Sector-14, Gurgaon 122 001

Tel: 91-124-2303212

Fax: 91-124-2301704

Website: www.motorola.com

Highlights

  • Strengthened distribution reach through 31,000 retail
    outlets

  • Stepped up visibility in consumer space through
    innovations

  • Bagged MTNL 2G/3G deal for 2 mn lines in Delhi

  • Bagged large expansion deal from

    Tata Teleservices
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Motorola continues to revamp its product portfolio in a bid to address larger
market segments. Increasing its range of products from mere 10 in mid 2005 to 30
products, Motorola now has a product for every price point. It launched its
entry level Motofone. Its Motofone brand of GSM phone is available at Rs 1,650,
while the cost of CDMA phone is Rs 1,299. Motorola launched four entry-level
phones in April 2007. Apart from the low-end, it has introduced a comprehensive
range of mid-range and high-range devices. Apart from handsets, Motorola has
introduced products to cater to Bluetooth segment.


'We are focusing products
based on the needs of the market'

How has Motorola India performed in FY '06-07?


Motorola India revenues grew considerably.
There was a huge growth in revenue with the revival of the handset business.
In the connected home space of cable and DTH we have made some beginning and
real growth is planned for 2008, as people have started to move from analog
to digital.

Amit Sharma

VP-Strategy, asia pacific & regional head South east asia

Things don't look too rosy for you in wireless
infrastructure.

What are your plans?


In the area of cellular infrastructure we have
some setbacks but we still retain footprint in with major operators. Operators
believe that the future is with the wireless broadband (3G and WiMax). And we
are well positioned, both with respect to technology and product. We have a
relationship with every operator, and we plan to grow significantly in 2008.

Motorola has done exceptionally well on mobile
handsets. What were the reasons for your success?


In mobile handsets there were three key
points. First, reorganizing the Indian market as it has unique requirements and
one has to leverage in terms of software customization with respect to user
interface and application. Second, we significantly strengthened our
distribution channel to increase our reach. Third, we stepped visibility in the
consumer space through brand ambassadors and innovations. We are focusing
products based on the needs of the market.

There has been a lot of talk about WiMax, CDMA,
EV-DO, and WCDMA. How do you see these technologies in FY '07-08?

Our next big thrust is broadband/entertainment TV to the home. We are also
looking at connected homes and we have the visibility in devices. We have a huge
role in terms of new technology to the consumer such as WiMax CPE and phones. In
the initial stages any box will do but later world class products and brands
make an entry. We are banking on handset to leverage on these two fields, and it
is operator driven as well as channel driven. It will be a new game for everyone
and has to be played sensibly.

How do you perceive the future of WiMax in
India?


India has not adopted 3G but India has the
opportunity to leapfrog. Most countries have a large 3G market and operators are
yet to recover cost. We are fortunate as we can do a mix and match, and it is
best of breed for different kind of usage. While spectrum is limited, 3G is good
for voice usage and for high speed data it is WiMax. So we can have WiMax and
GSM and WiMax and CDMA device. And when that happens we will overtake other
countries in Asia.

For WiMax, there have been small pilots as
spectrum is not allocated. We have Canopy in the unlicensed technology deployed
for Rajasthan SWAN and 16 (e) pilots will happen in Q4 and after that we can see
commercial deployment and next year we can expect around 200-300 city WiMax
deployment in the country.

On the branding front, Motorola is focusing on the India appeal. It wants to
build a strong India connection. It has revamped its marketing strategy and
instead of product focus it is personality focused. Motorola is promoting itself
as a youth brand and the emphasis is therefore on the color and design.

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On the network front, Motorola has bagged MTNL contract for the supply 2G/3G
cellular network for Delhi. Motorola has got orders for 2 million lines and will
take care of network deployment and maintenance services. The company also got
expansion orders from BSNL.

A number of important investments in manufacturing and R&D, and its focus on
distribution, product, brand and partnership strategy has made Motorola an
aggressive player in the Indian market, though a long way to go.

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