Dell gets serious about smartphones with mobile unit

by Caroline Gabriel, Rethink Wireless

Dell’s attempts to enter the mobile business have been stop-start, ever since it laid out a smartphone strategy in early 2003, only to cancel it six months later. Since then, it has been linked repeatedly with a bid for Palm, hired former Motorola handset chief Ron Garriques in 2007, and finally unveiled an Android device – even then, after several false starts – in 2009, as well as joining in with China Mobile’s 3G cellphone program. Now the US firm has sharpened the focus on mobility, creating a dedicated division for communications and mobile devices, headed by Garriques (who currently runs the more diffuse consumer division).

Garriques will now have a unit that will be more specifically focused on handsets and MIDs, and will have increased resources to develop and market these – though he will lose the rest of the division’s consumer devices activities, which will be merged into the small business PC operation, headed by Steve Felice.

In the past few months, Dell has launched its Mini 3 Android smartphone, initially in China and Brazil, though The Wall Street Journal has reported that it will have an AT&T deal from next year. This still leaves it behind fellow PC makers Acer and Hewlett-Packard, both of which set out business and consumer smartphone strategies at the turn of the year, and have been quicker to deliver products – though neither has, so far, made much impact outside their corporate niches.

All of them face the problems of adapting to a business which, though a logical step in marketing terms as PCs and phones converge on the MID space, is very unfamiliar to them in terms of distribution channels, economics, competitors, supply chains and differentiation factors. John Jackson, an analyst at CCS Insight, commented in a research note, quoted by the WSJ: “We have no reason to believe Dell will be capable of significant differentiation or disproportionate value capture at this point regardless of platform choice.”