With Motorola's acquisition, Lenovo is gunning for Apple and Samsung

With Motorola's acquisition, Lenovo is gunning for Apple and Samsung
As you can imagine, the tech and business communities worldwide are abuzz over the news that Chinese Lenovo has reached a deal which will see the ownership of Google's daughter company, Motorola, change hands. Interest has been pretty high, as it was made clear from the very beginning that this deal will remind a lot of Lenovo's 2005 acquisition of IBM's ThinkPad division, meaning that it'll try to leverage the Motorola brand instead of disintegrating it and cherry-picking its remains. This has lead many industry observers to speculate about the gravity of the deal -- Lenovo does have some serious experience in manufacturing and distribution under its belt, and a truly global reach. A Fortune interview with Lenovo's CEO, Yang Yuanqing, reveals that the Chinese giant is not about to play it low key, and is apparently gunning for Apple and Samsung in the long run.

According to Mr. Yang, the combination of Motorola and Lenovo is "perfect", as the two companies have a presence in several, geographically-distinct regions, and Motorola's strong engineering capabilities and good ties with US carriers ought to play nice with Lenovo's plans of expanding its reach. Mr. Yang goes ahead to corroborate that the deal is, indeed, very much alike to the one it carried out with IBM almost 10 years ago, and that he feels the two companies are "definitely complementary". 

Lenovo is also not shy about sharing its strong ambition to win the trust of some 100 million smartphone buyers in the coming year, even though the two companies together had sales of about 55 million in 2013, according to the IDC. Seeing as this number actually puts them in the coveted Top 3 of smartphone manufacturers, the interviewer naturally went on to ask a question that we are all intrigued by -- can Lenovo catch up with Apple and Samsung? The Lenovo executive gave a short and telling answer:


Of course, that's easier said than done, and while it's still too early and Lenovo hasn't "made a final decision", the first clues as to how the duo is to manage such a feat are there. Apparently, the plan for now is to "fully leverage the Motorola brand in the U.S. and Latin America" like it did with the ThinkPad brand in the PC industry. "Motorola will be our smartphone product", Yang says, though the exact specifics of 'how' are not ironed out. The CEO says that the final arrangement is yet to be agreed on, but one scenario would be for Lenovo to keep marketing its products under the same brand in its homeland of China, and Motorola in at least the US and Latin America. Moreover, it's not completely out of the realm of the possible that Lenovo will "reintroduce the Motorola brand" in China

We'll be obviously keeping tabs on the two companies as we go deeper into 2014, but we think its obvious that we are intrigued by the prospect of a third really major player in the space. What about you?

source: Fortune

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18 Comments

1. ScottSchneider

Posts: 336; Member since: Dec 06, 2011

Give us a Vibe Z Razr MAXX...

2. galanoth

Posts: 428; Member since: Nov 26, 2011

That's great optimism. But realistically, I don't think any other company will be able to sell more smartphones than Apple or Samsung.

3. Doakie

Posts: 2478; Member since: May 06, 2009

That's great pessimism. But realistically, it was just two years ago people said "I don't think any other company will be able to sell more smartphones than Apple." The next thing you know Samsung did it. Don't doubt, it can always be done again.

4. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

The ThinkPad acquisition didn't unseat the other larger players at the time. Lenovo bought its way into a segment of the notebook market and was able to impact its cost model in ways that IBM never could have. In that respect, I suspect history is going to repeat itself. But going after Sammy? I doubt it. Lenovo has a better chance of passing Apple, given Apple's penchant for maximizing profit per unit.

5. VZWuser76

Posts: 4974; Member since: Mar 04, 2010

Are you sure about that? IIRC a few years ago when they bought up Palm, HP was the #1 PC OEM, and now Lenovo is. I'm not thrilled with a tech icon like Motorola going to a foreign company, but as long as they don't try to cut corners like going with Mediatek processors and skimping on build materials, I'll probably consider them for my next phone. Also they hopefully plan to keep the Texas plant open, at least for the North and South American phones. But it sounds like they're committed to actually growing the Moto brand. Of course, they wouldn't say if they plan to gut the company at this time either, but time will tell.

12. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

I was referring to notebooks (ThinkPad market segment). You are totally on point about Desktop PCs, though. Only time will tell whether Moto is gutted. When I read the news about Google unloading Moto, I sighed. I was soo hoping that Google was going to infuse an entrepreneurial culture back into Moto. Things seemed to be heading in a positive direction with the update release cycle (night-and-day comparison between the Maxx and the RAZR of 2 years ago). Oh well. Time to wait and see.

7. SonyPS4

Posts: 347; Member since: May 21, 2013

Look what happen to Nokia smartphone.

6. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Well, it looks like Lenovo is full of confidence to surpass Samsung and Apple with the help of Motorola. Good, i like it! Good luck to both of them! Lenovorola!

13. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Everyone in the DROID crowd (other than htc) and even Apple has now up-ed their game. Next year is going to be ridiculous.

15. Mxyzptlk unregistered

Or just plain full of it.

8. Just.Saying

Posts: 132; Member since: Apr 04, 2013

To beat samsung lenovo will have to do alot more than just buying a cell phone manufacturing company, Samsung makes its own AMOLED displays and most of the other hardware used in its products. In my oppinion, i a few years,samsung will use 100% of its own hardware in their phones.

9. fanboy1974

Posts: 1345; Member since: Nov 12, 2011

This is more a win for Android and it's users. I don't care if Samsung sales less just as long as Android remains dominant. It's tougher for Apple to battle 5 good OEM's than one big one.

10. WindowsiDroid

Posts: 138; Member since: Jul 22, 2013

I'm totally excited on what will happen on Motorola. I just wish that Lenovo must also reintroduce Motorola all over the Asia not just China.

11. Just.Saying

Posts: 132; Member since: Apr 04, 2013

i've been going through brochures here and none of the carriers have an any motorola deals. South Africa

14. anleoflippy

Posts: 596; Member since: Jan 03, 2013

Same here, I live in Malaysia and we don't get some Motorola Goodness like the Moto G or Moto X. We only get their last generations of phones which is still on ICS. Heck I don't even see a store that sells the LG G2. All I see is Apple and Samsung. Barely any stores selling Sony phones unless at Sony Centres.

17. aksa123

Posts: 366; Member since: Jan 30, 2014

Moto G hasnt arrived in malaysia ? I thought it had. Moto X is North America -exclusive T.T

16. jpd514

Posts: 57; Member since: Nov 08, 2013

With the sale of Motorola to Lenovo Google just come to kick Samsung in the guts after dealing with them the end of touchwiz. Touchwiz was portable with their fans to Tizen, Samsung own OS.

18. Leonis

Posts: 338; Member since: Jan 08, 2014

Lenovo will do better than Samsung. Samsung will drop market share since all they do now a days is to push out new phones with bad features. I'm glad HTC and Samsung will go for a release close to Samsung. I know many people who complain about Samsung.

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