Will a New Handset Lineup Put Motorola Back in the Game?

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Motorola (MOT) unveiled a new handset lineup–including an enterprise class Q–but it's unlikely they can pull the company out of its doldrums.

For Motorola, it's quite a turnabout. When Ed Zander joined Motorola as CEO after a long stint at Sun Microsystems (NASDAQ:SUNW) he could do no wrong. Now he can do little right and has billionaire investor Carl Icahn breathing down his neck.

At 3GSM on Monday, Motorola announced the Motofone F3, a low-priced phone for emerging markets, the MOTOSLVR L9, a premium handset, MOTORIZR Z8, designed for video and audio quality and the Moto Q 9, which comes with the acquired mobile messaging technology from Good Technology and runs on Windows Mobile 6 (gallery). Most of these products will arrive around mid-year or the second half of 2007.

MOT handset The reaction Tuesday to that lineup is decidedly mixed. Citigroup analyst Daryl Armstrong says early demand for the Motofone is weak. "We also believe the disappointment here is creating some management turmoil in Motorola, given how much the company was betting on this product to help them gain share in the emerging markets," says Armstrong in a research note.

Armstrong argues that Motorola bet the company on two transitions–moving customers from the RAZR to the KRZR, which turned into a fourth quarter disappointment, and the C11x, the former flagship handset for emerging markets, to the Motofone.

Oppenheimer & Co. Lawrence Harris analyst says the RIZR Z8 is the most interesting rollout of the bunch because it has a "kick slider" that can conform to your face. The Q is another wildcard. Although David Berlind derides the Q–and I've been through two of them in 3 months as well–Harris indicates that the "pricing on the Q has risen at Verizon. A silver Q will cost you $150 at Verizon up from $100. So someone is buying the Q.

But it's not enough to pull Motorola out of its ditch though.

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