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Dell "back to drawing board" on smartphone

updated 10:45 am EDT, Fri March 20, 2009

Dell Reworking Smartphone

Dell hasn't shelved its planned smartphone but has taken to a significant redesign to salvage its effort, Kaufman Bros. senior analyst Shaw Wu said in a research note on Friday. While he and other sources were originally thought to have been mistaken when a predicted smartphone didn't show at Mobile World Congress last month, it's now believed that Dell was forced to redo the project as a "lack of carrier interest" and few offers of deep discounts made it risky to sell the proposed device. Prototypes had already been created with both Android and Windows Mobile as the operating system.

Much of the hostile reaction was purportedly triggered by a lack of originality, Wu claims. The hardware was relatively similar to existing designs from HTC, LG, Nokia and other firms; no carrier had an incentive to choose Dell's phone over another from a competitor that would achieve a similar purpose. Palm's Pre is also thought to have made the damage worse by giving some carriers a viable alternative.

To counter the response, Dell is not only said to be creating a more distinct design but may be pursuing a vertical integration of hardware and software in the vein of Apple's iPhone or Research in Motion's BlackBerry. The PC builder may need to buy out specialized companies to complete the project.

Wu warns that Dell would need to be careful entering the smartphone business as its margins are too low to afford a loss. Simultaneously, he adds that a successful launch may give Dell an edge through its experience with computing, which would give it an understanding closer to Apple's than to phone-only rivals.

"PC vendors may have an advantage over traditional cell phone competitors as a smart phone is more PC than cell phone with all the computer functionality and voice as a commodity," he wrote. "So far, PC peers Acer, Asustek, and Lenovo have beefed up their smart phone offerings with the success of the iPhone as likely inspiration."




by MacNN Staff

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Comments

  1. testudo

    Joined: Dec 1969

    -2

    'lack of oiriginality'

    Coming from the carriers? Really?

  1. slapppy

    Joined: Dec 1969

    0

    The other one

    Back to the drawing board for the Adamonation also. They ha the right idea and blew it by attaching a big a** on the laptop.

  1. loudpedal

    Joined: Dec 1969

    0

    Stop!

    Overheard at a Dell board meeting: "Would Apple stop innovating already? Our copiers can't keep pace!". Pretty sad that they couldn't come up with a decent offering, even with Android supplying all of the software.

  1. testudo

    Joined: Dec 1969

    -2

    Re: stop

    Well, it took apple years to finally release a phone.

    of course, all of this is all 'inside information' by analysts, both in that Dell was doing a phone, and now they're back to square one.

  1. Sandkat

    Joined: Dec 1969

    0

    This should be fun.

    Hey remember the Dell DJ?

  1. MeandmyMac

    Joined: Dec 1969

    0

    Re: Re: stop

    Didn't Apple have a "phone" offering before the iPhone and that earlier phone came from Motorola called the ROKR 1?

    I wonder what if any freedom Apple had regarding the "design" of the ROKR? Probably little to none. I know it was paid only brief lip service by Jobs at the Sept 7, 2005 product introduction event.

    I bet Steve saw what little innovation came from the "phone makers" and had Apple start from scratch with ideas from himself and other Apple talent and sure that takes time. But for these iPhone "killer" phone makers producing a product they have a model to go by... the Apple iPhone. Lucky Dell! Lucky MS! Lucky RIM! etc.

  1. testudo

    Joined: Dec 1969

    -1

    Re: stop

    Didn't Apple have a "phone" offering before the iPhone and that earlier phone came from Motorola called the ROKR 1?

    No, that was in no way an 'apple' phone. It was a Motorola phone with iTunes support. No Apple logo. No sales via the Apple store. It was not designed, or intended to be designed, by Apple in any way, shape, or form.

  1. solefald

    Joined: Dec 1969

    +1

    oh great...

    another FAILphone

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