5 Reasons Why Dell Won’t Fail at Smart Phones

February 2nd, 2009 by Mark Spoonauer, LAPTOP Editor in Chief  

axim_x51vWhen the rumors starting swirling again last week that Dell would be entering the smart phone market, I rolled my eyes pretty much like everyone else. What could Dell possibly bring to the table at a time that the iPhone and its thousands of apps are nearly ubiquitous? How could they match the slick software of the Palm Pre’s webOS? Could they really do mobile e-mail better than BlackBerry? Industry insiders and consumers alike have every right to be skeptical. And even Dell seems a bit jumpy. After the initial Wall Street Journal report surfaced, the New York Times reported on Friday that “people knowledgeable about the company’s plans say the company does not plan to announce a product anytime soon”. I think Dell could certainly make more of a dent than other PC makers whose smart phone efforts have fizzled–ahem, HP–and make a much better handheld than the Axims of yore. Here’s why.

1. Dell could sell a $149 or possible even a $99 Android or Windows Mobile device without taking it on the chin. Although Dell is new to the mobile phone game, I have a hunch that the company will be able to flex its supply chain muscles to get the components it needs for the lowest possible cost. iSuppli revealed earlier this week that the BlackBerry Storm costs $4 more to make than its purchase price. Given its scale, I think Dell could do better.

2. Dell could let you buy first, then choose your carrier. One of the less talked about features of Dell’s (and others’) notebooks is the option of adding Gobi mobile broadband, a software based radio that enables users to buy the system and then decide which carrier to sign up for. You can even change between EV-DO networks and HSDPA on the fly (although that whole contract business is admittedly a mess). Picture a phone that lets you do the same thing. An ultra-affordable unlocked smart phone that lets you pick your carrier. This is a long shot, but it could happen.

3. Dell finally gets that software matters (but still has a lot of work to do). Back when Dell debuted its Studio laptop line, we didn’t really dig the design but  appreciated the Dell Dock software for organizing your programs. Dell recognized a pain point for Vista users and addressed it with an elegant solution without obliterating the desktop. On the phone side, HTC, Samsung, and other Windows Mobile licenses cover Windows Mobile up to the point that the devices are schizophrenic. I’ve also seen some pretty cool things behind closed doors that Dell is hard at work on for PCs that makes me believe that the company is heading in the right direction.

4. Dell is stepping up its design game. Say what you will about too-cool-for-school laptop lids Dell is peddling right now. All it takes is one look at the upcoming Adamo to realize that Dell can design something that’s beautiful, something you’d want to be seen in public with. (Even if at this stage the machine is relatively heavy.) In fact, I wouldn’t be surprised to see the Adamo brand, which is more aspirational than Inspiron, migrate to the handset realm.

5. Don’t underestimate the Motorola + Zing connection. Even though Dell had already started its descent into the abyss when Ron Garriques jumped ship from Motorola to Dell to become responsible for its entire portfolio of consumer products, Moto did launch one of the most successful phones of all time on his watch in the RAZR. What the RAZR lacked was elegant software or any sort of connection to the cloud for entertainment. And that’s what Dell’s now long-nascent acquisition in Zing could bring to the company’s smart phones. Zing’s DNA, when paired with Garriques’ hardware vision, could help Dell differentiate both its rumored Android and Windows Mobile devices.

Think I’m nuts? Sound off in the comments.

Comments (4 Responses) 

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4 Responses to “5 Reasons Why Dell Won’t Fail at Smart Phones”

  1. Glenn Connery Says:
    February 2nd, 2009 at 5:49 pm

    Yup, you’re nuts. Well, not completely.

    I have no doubt that Dell can produce good hardware, they do it every day. But the fact that they managed to write a reasonable dock for Windows doesn’t say anything about producing a complete phone OS. I doubt very much they have the talent on board to do a competitive job here.

    At this point, the obvious assumption is that they would produce a device which relied almost entirely on somebody else’s phone OS. Meaning presumably Android. Not sure what exactly they could bring to this space that numerous others won’t be bringing in time, but its certainly possible. And Android seems like a nice platform to bet on as well, though so far I’m sure it hasn’t broadened its appeal beyond the techno geeks.

    A Windows Mobile based phone would be the obvious choice, given their previous tie-ups with Microsoft, but the failure of this OS in general and Dell’s recent experience with the Axim line and their music player should tell them something here. This would be a waste of their time unless Windows Mobile 6.5 or 7.0 is going to be much better than we all expect.

    Could they do a licensed version of the Pre, e.g. using WebOS? That might be a nice possibility. Certainly there are other form factors that could be introduced, and Palm might be open to this.

    The obvious reason for them to do this though is that they’ve figured out that mobile phones might just be the future of computing, and if they don’t jump on here, they might find themselves in the cold in the future.

    My hope would be that if they’re going to do this, they produce a phone that you can get a dataplan for with a reasonable cost (say $10/month) to use as a tether for your laptop, with a bluetooth connection between them, making it possible to get a single plan for data for both. They might just have the clout to do this.

  2. GearModa Says:
    February 2nd, 2009 at 7:11 pm

    This is going to be interesting, Its definitely going to be tough, especially with the competition with cellphones, but i agree, Dell does have several things going for them that can help them grow a cell phone line.

  3. tal Says:
    February 2nd, 2009 at 9:27 pm

    If they partner with Google they can have a big win-win situation for both companies. Google is about to sink with its Android’s inability to attract meaningful companies to develop hardware for it. And Dell can do the next big thing after G1, which could really top iPhone and Palm.
    This month is going to be the one when people will either see Android rise or crash miserably to the ruthless competition.

  4. Faison Says:
    March 31st, 2010 at 1:27 am

    I’m not sure that I agree with the general consensus, but the point is argued very well. Makes it seem a worthwhile blog to visit. ;)

    Tristan
    Spyware Protection

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