As The Reign of Razr Ends, Others Vie for Handset Lead

BlackBerry, Sony, LG All Push Designs as Motorola Brand Starts to Lose Luster

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SAN FRANCISCO (AdAge.com) -- The razr could be losing its cutting edge.

Heralded as one of the design triumphs of the decade, the sleek phone changed Motorola's fortunes -- reversing its market-share slide and leaving rivals playing catch-up. But as the former $500, hard-to-get handset becomes a commonplace, free-with-your-plan phone, other manufacturers are starting to believe their own sexier products can end the Razr's reign.

Motorola, of course, expected that. But the question is whether it has done enough to create the next hot product or generation of products. "Motorola had done a great job shaking up the market, and it's exactly what we needed," said Jon Maron, senior director-marketing, LG Mobile, which markets the Chocolate brand. "But a lot of people have said, 'We're ready for something new and different.' Motorola isn't necessarily doing that going forward."

Leslie Dance, Motorola corporate VP-global marketing and communications, disagreed. She said Razr propelled the company down a path that has provided "a platform to build other cool iconic design-led products."

Among Razr derivatives in the market are the Slvr (a candy-bar-shape version of the Razr), the Q (a smart phone). And more are coming. Motorola's successor to the Razr line, the Krzr, a phone with camera, music, Bluetooth and navigation features, will receive big play this holiday season when it's introduced by Verizon Wireless and other carriers in the U.S.

Motorola also plans to boost its brand with the Scpl, short for Scalpel, a phone that, as the name suggests, is said to be even slimmer than the Razr and is intended to be inexpensive enough for the poor and unconnected. And Sprint will add the Razr to its lineup, selling the Red Razr as part of a project to fight AIDS in Africa.

Available in multiple colors and even in a Dolce and Gabbana version, the Razr has done to the handset category what the model Twiggy did to fashion runways: It made thin a permanent part of design. "The Razr has set the bar for the industry and for people's expectation for design," said John Jackson, senior analyst, M:Metrics. "It has shifted the emphasis to fashion from function."

Motorola's global market share has grown to 21% in the third quarter of this year from 18% in the third quarter of 2005, according to Strategy Analytics. Nokia also picked up share from the smaller players, rising to 34% in the third quarter of this year from 32% in third-quarter 2005. LG's share, meanwhile, dropped to 6% from 7% in the time period, and Samsung's share was flat.

M:Metrics' Mr. Jackson said the Razr has "has been masterfully managed through a product life cycle that has outlived almost any comparable handset."

That will be tested this holiday when it is up against Blackberry's Pearl and other smart phones originally aimed at business users but increasingly adopted by consumers, as well as music phones, such as Sony Ericsson's Walkman line, which has sold 15 million units since its launch last year, according to Mr. Ambrosio.

For its part, Motorola isn't worried. "Demand hasn't lessened," said Ms. Dance. "It's still an iconic product everybody wants."

But it should take pains to keep it that way. "The company," noted an executive working on the Motorola brand, "needs to be sure there's more to them than just the Razr."
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