Motorola Unveils High-Speed Data Phones

C A N N E S, France, Feb. 20, 2001 -- Motorola todaydismissed concern that the mobile Internet will not take off andsaid it would increase its high-speed data handset models inmid-2001 from the present solitary offering.

This is likely to be music to the ears of promoters of thenew technology General Packet Radio Service (GPRS), especiallyafter its forerunnner WAP, which offers slow and restrictedmobile data services in Europe, failed to live up to consumerexpectations. "We're saying GPRS is coming to life. It's no more babieswith nappies," Fred Kuznik, president of Motorola's operationsin Europe, Middle East and Africa, told Reuters in an interviewat the GSM World Congress, an industry trade show in Cannes.

Europe Skittish About GPRS

Motorola, the world's second largest mobile phone makerafter Nokia, is currently the only company selling aGPRS handset, called Timeport 260, that aims to give customersin Europe "always-on" Web access instead of repeated dialing. U.S. Motorola Inc, which said some 35 operators were buyingits GPRS phone, will launch four new GPRS phones in the secondand third quarter of this year. Concern about the full launch of this new technology acrossEurope was reinforced last month when Nokia delayed plans forshipping GPRS phones in volume unit until the fourth quarter of2001. If GPRS, which is only up-and-running in limited volumes insome European countries, proves problematic, investors maycontinue to shun a sector that has become one of the biggestfinancial bets in history due to heavy up-front investments. European telecoms operators — who are promoting the mobileWeb at the world's biggest wireless conference in Cannes — have paidsome $100 billion for new generation cellphone licences — andfuture returns hinge in part on the success of GPRS.

GPRS Operators Buy Phones

Kuznik, former president of Motorola's personalcommunications division which includes handsets, said 35operators had approved Motorola's GPRS phone for use on theirmobile networks and were placing unspecified orders. Motorola declined to name the operators or say what kind ofvolumes were being purchased. But Motorola is expected to havereceived orders from leading operators such as UK-based Vodafone, British Telecom and France Telecom. Kuznik said Motorola had a window of opportunity in the raceto dominate the mobile Internet in Europe because no one elsehad yet started selling GPRS handsets and it was already gettingready to sell its newest faster GPRS phones, which will giveusers access to e-mails and other mobile services. The race to win the GPRS race is considered crucial indriving new demand in the cutthroat handset business as theindustry tries to find a consumer market for even fastermultimedia "third generation" mobile phones.

Motorola’s New Phones

Kuznik said they would start selling the small, lightweightMotorola V120 phone, as well as its tri-band V66 handset in thesecond quarter. Tri-band phones allow customers to use theirphones globally, including North America, where standards vary. Its all-in-one, touch screen Accompli 008, which doubles upas a personal organizer and mobile phone, will be sold inmid-2001 and is likely to put still more pressure on rivals,especially at a time when consumer demand for phones is easing. "This portfolio of phones strengthens our position as aleading GPRS provider," Kuznik said, adding the new range ofphones were targeted at all consumer segments. Sweden's Ericsson, which is struggling to turn around itsloss-making handset unit, plans to start selling its GPRS phonein Europe next month, but it had not yet announced the launch ofany high-speed phones with big touch screens. Motorola also said it would start selling a more inexpensiveGPRS phone — Talkabout 192 — from the third quarter of 2001. Harnessing the low-end handset market is vital for anindustry in which more than two-thirds of the market, or around 270million mobile phones, have traditionally targeted the lesswell-heeled consumer.