Albert Lin of independent American Technology Research sent out a very interesting note this morning to his clients, outlining why Motorola v710 is going to be a massive hit for Motorola and prove a reason for financial upside for both Moto and Qualcomm. Lin estimates that Motorola will sell about $100 million worth of phones through the year, enough of a reason for RadioShack to pre-announce upside and increase full year revenue and earnings targets and mostly because of v710. Verizon could sell 100,000 units of this and at about $450 net this could mean $45 million in sales for the current quarter and $250 million for the fourth quarter.
Motorola v710 will boost sales for Motorola, but should also serve to raise ASPs. As the first major TransFlash enabled phone, SanDisk may gain more attention and sales momentum for this new product category going forward. The V710 is a CDMA 1X phone based on Qualcomm’s ASIC and the high ASP should benefit QCOM from a royalty angle even more than from the chipset sale, as we expect Motorola to experience 15%+ Y/Y ASP gains.
Here are some of his arguments about the phone is so hot:
- Best color screen – he is right on this one, though after three days of use, you have the keys of the phone scratching the screen.
- Best camera: ha ha ha haaaaaaa. dude take some photos and see the quality before you make this statement. Try one of the Sharp, Nokia or Samsung phones and learn what “best camera” means.
- MP3 Player – A non-stereo headphone jack a terrible design oversight. Please! Also cannot send Mp3 files to the phone to set as ring tone.
- Speakerphone: Try using the speakerphone. Sometimes the design flaws in the phone accidentally turn on the speaker phone. What if you are having a one-sided dirty conversation with your better half and hit speakerphone in Starbucks. I rest my case.
What could a hot phone be to Motorola? The V3 RAZR to beat that record shortly. Except I get a feeling it is late by a few months. They sent us a phone which was a phone except it could not make phone calls. Lin makes a very compelling case, however untrue. and misses the crucial point – the recent backlash against Verizon’s decision to “cripple” the phone. I think Lin might be setting expectations too high, and the phone is not going to be a huge hit. From recent conversations with actual users, v710 is going to a thud, especially when customers are disappointed it could lead to a consumer backlash. And that is happening right now as we speak to some extent. And dude when early adopters, also known as “money bags” who pay for the latest phone don’t like the phone and bitch about it on SlashDot, you know it is not a hot phone!
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