Moto X is the starting point for the new Motorola, not the end

Phil Goldstein

A little more than a month ago I ruminated on what the impending launch of the Moto X, the flagship smartphone of Google's (NASDAQ:GOOG) Motorola Mobility unit, would mean for Android.

The Moto X is now here, and while I don't think it will have the kind of far-reaching ramifications I speculated about, the device does represent the rebirth of Motorola as a brand wholly distinct from other Android device makers. The biggest question I have now is whether Google and Motorola can market the Moto X successfully enough to ensure Motorola's continued relevance, and allow it to evolve along the path of innovation that it has started out on with the phone.

Before discussing what the Moto X is and what it could represent, let's say what it isn't: In terms of specifications, it's not Samsung Electronics' Galaxy S4, or the HTC One. Its display, at a 720p resolution, is of technically lower quality than those found on some high-end phones. It doesn't have the kind of camera that Nokia's (NYSE:NOK) Lumia 1020 sports. It doesn't have the newest Qualcomm (NASDAQ:QCOM) Snapdragon 800 processor. For some consumers, more mid-range specs will be a deal breaker, and they will be turned off by the phone. Retail sales representatives at carrier stores might not be as enthused about it, and consequently won't push it hard. Motorola is banking that none of that really matters.

The Moto X's processor is an interesting window into how I view the phone, which is as a starting point for Motorola as it refocuses away from differentiating on hardware and more on software and the user experience--which, not coincidentally, are hallmarks of Google's product strategy.

The Moto X uses a system-on-a-chip architecture called the X8, with eight processing cores, one of which is a super-low-power core used for "natural language processing," which also saves the phone a lot of battery life. That core lets the phone constantly listen for the words "OK Google Now." One of the key features of the phone is Touchless Control, an always-on voice recognition system that quickly learns a user's voice and only responds to them. When a user says "OK Google Now," users can launch the Android app Google Now to check the weather, traffic or other information simply by using their voice.

That is emblematic of the approach Motorola is taking with the Moto X--less about specs and more about what the phone can do for you and how it can solve problems. Another part of the message Motorola is delivering with the Moto X is that personalization matters--consumers will be able to make more than 2,000 customized variations of the Moto X through different colored cases and other accents (though this option will only be available to AT&T Mobility (NYSE:T) customers at launch, other carrier partners will support it as well).

Google looks "at Motorola right now as a company that can do different things than they are getting from companies like Samsung," said Current Analysis analyst Avi Greengart.

IDC analyst Ramon Llamas said that the Moto X represents Motorola's hardware savvy but also "brings a lot of Google's own innovation whimsy. And it brings Google's, 'Hey can't we do it this way?' approach."

I like that philosophy. As Roger Cheng noted in CNET, this is the anti-iPhone approach. Up until now, Apple (NASDAQ:AAPL) has prescribed for consumers what they should like and how their phones should look. Motorola is saying that your phone will not only be customized in its look but will come to recognize and respond to just your voice.

All of that is indeed well and good, but will it be enough for Motorola to sell the Moto X? Analysts I spoke with admitted that because Motorola has essentially decided not to compete on specs (Recon Analytics analyst (and FierceWireless contributor) Roger Entner said it was like "showing up for a 100-meter dash and saying I'm not competing on speed"), it will have a tougher marketing message to convey.

"It's a tough message to demonstrate," Entner said. "The easy stuff to display are the specs. The, 'I solve your problems' [messages] are challenging to really convey in advertising."

Google will reportedly spend upwards of $500 million in marketing the Moto X, according to a recent Wall Street Journal report, a figure which Google has neither confirmed nor denied. Certainly, if early indications show anything, Google will spend a lot of money marketing the Moto X.

The phone also has wide distribution, at the four Tier 1 carriers and U.S. Cellular (NYSE:USM). Only two OEMs, Apple and Samsung, can pull off that kind of feat. Additionally, the more mid-range specs mean that the device likely has a lower cost for carriers, which means less of a subsidy cost they have to pay. That could give them an incentive to  push the phone more, but a lot will come down to how Motorola markets the device itself.

I agree with Llamas that the Moto X represents a "blueprint of what's to come" for Motorola. Entner characterized that future as "more of a software showcase for Google than of a powerhouse that slugs it out, toe to toe and fist to fist, with the Samsungs, the HTCs and the Apples of the world."  

Does that justify Google's $12.5 billion acquisition of Motorola? As I said last month, probably not. "It's an opportunity to innovate and show the art of the possible," Reticle Research analyst Ross Rubin said of the future of Motorola. "But that doesn't necessarily mean it will represent the kind of revenue opportunity that Samsung's smartphone business is to Samsung."

Google has deep pockets, so maybe it can afford not to care about that. As AllThingsD's Ina Fried recently noted, the Moto X is not designed to save Motorola from death. It's designed to give birth to a new kind of Android handset maker. This is just a first step. I want to see what comes next. --Phil