Dell dumps smart phone plans

I railed against Dell's unnecessary $2000-and-up MacBook Air clone, the Adamo, the other day. Today, I salute another bit of Dell news because this time they're actually making some sense.

Dell's anticipated effort to release a mobile phone has stalled after suffering from "a lack of interest" among cellular carriers, according to a research note published Friday.

Kaufman Bros. analyst Shaw Wu wrote that Dell's prototype devices, designed to run software from both Microsoft and Google, have so far failed to distinguish themselves from a growing field of competitors.

"From our conversations with supply chain and industry sources, it appears that it ultimately came down to lack of carrier interest," Wu wrote.

Rumors of a branded Dell mobile phone have been swirling since January, when speculation surfaced that the company might unveil a device at a high-profile event such as last month's Mobile World Congress.

But the potentially small subsidies from carriers operating cellular networks to help sell Dell's devices meant it would be difficult for the Round Rock, Tex.-based PC giant to make a profit.

Wu wrote that Dell has not abandoned its effort to release a mobile device, though it has "gone back to the drawing board" to design a more distinct model, which may involve making related acquisitions.

Sounds good to me. If you can't make a dent, don't bother.

Discuss this Article 30

bettieblu
on Mar 23, 2009
Sony and Samsung? Just dumped Windows Mobile or so I read, for Android no less.
DarkSages
on Mar 23, 2009
"Sony and Samsung? Just dumped Windows Mobile or so I read, for Android no less." As far as i know both are still making windows mobiles phones for this year some even showed up at the MWC, where did you read this? I don't think right now is a good time for a new comer like dell to entr the mobile industry, so good call. They should wait and make a device that can wow us and probably come out around windows mobile 7 release, google should also have an update by then for their operating system.
chuckb84
on Mar 23, 2009
"If you can't make a dent, don't bother" A compelling argument that should also be applied to the "Zune".
DavidR91
on Mar 23, 2009
"If you can't make a dent, don't bother." I hope that's sarcasm / only referring to the current model, rather than their whole effort. Some of the greatest pieces of tech with have, had to fight with adversity to become known, and are now pretty damn big. iPods were not initially accepted, Dyson vacuum cleaners were considered "ugly" (Consumers _supposedly_ didn't want to see the dirt inside the machine via transparent windows - this turned off potential investors etc.) heck even Windows was considered marginalised at some point. I'm pleased Dell is considering keeping it around - they will most likely improve from the criticism and create a great device.
Thunderbuck
on Mar 23, 2009
The trouble is that Dell's mobile efforts thus far have amounted to little more than providing a sales channel to HTC. That company is now doing a fair business on its own, so it's really hard to imagine what Dell could bring to the table that's new and interesting. (PS: I kind of like the Adamo, though...)
gfryesc1
on Mar 23, 2009
it's about time MS wrapped up this Zune thing as well.
rjohn05
on Mar 23, 2009
If Zune continues to mature I think it will eventually make a dent. There is no reason Microsoft cannot do something innovative in the mp3 player market to steal market share from Apple. As far as Dell is concerned, I think they made a good decision. I would like to see a phone from them in the future.
Lindy
on Mar 23, 2009
Zune will never make a dent....never. Its too late. Honestly I think MS should shut down the Xbox as well. Its still bleeding money after the massive failure rate. I just read the other day there is a new problem on the 360 causing even more failures. http://blog.seattlepi.com/digitaljoystick/archives/164682.asp?from=blog_... Stick to software.
Master3
on Mar 23, 2009
""If you can't make a dent, don't bother" A compelling argument that should also be applied to the "Zune". ___________________________________ A stupid premise picked up by one of the dumbest posters here. This type of foolish net culture philosophy is what's going to doom the tech industry in this nation as a whole generation of dumbasses who fall for it will never take risks or never try because the intelligentsia doesnt think it's worth it because you cant get the blog-o-circle to gush over what you made. The world of tech is starting to become more like Tiger Beat magazine as a result of this! What the hell is this going to leave us with? A handful of corporations, with a handful of products, that have gotten the blessing from a equally narrow group of writers and messageboard posters whom have given them their unearned stamp of "cool", that's what! And while the usual group of iTrolls have taken onto this nonsense to try to push the notion that the Zune should go away, what they are too stupid to get is that along with the Zune OSX, Macbook Air, buttonless iPod Shuffle, iMacs, and AppleTV all will be gone as well as they never became popular with more than a small number of people. Their is nothing compelling about this loony toon BS. And the lot of you had better pray in this economy that people do keep trying Get a clue. The numerous toys you have today came about through people trying things that sometimes did not take, did not become icons of their times, and did not sell millions of units.
Master3
on Mar 23, 2009
"Zune will never make a dent....never. Its too late. Honestly I think MS should shut down the Xbox as well. Its still bleeding money after the massive failure rate. I just read the other day there is a new problem on the 360 causing even more failures. blog.seattlepi.com/.../164682.asp Stick to software. " Shut down iMacs, OSX, MacBook Air, Mobile Me, and AppleTV. Hell shut down everything that isnt iPod or iPhone related seeing that it's the only division of Apple that are successful. STICK TO PHONES AND MP3 PLAYERS, APPLE!!!!!!!!! BECAUSE YOU FAILED AT EVERYTHING ELSE!!!!!!!!!!!!!!!! AND EVEN THEN YOUR SALES ARE TANKING!!! GO OUT OF BUSINESS APPLE. YOU ARE DONE!!!!!!!! At least using the thinking of Lindy, right? I mean reasoning like his has to be bullet proof.
ModernDislocation
on Mar 23, 2009
I am not sure how this devolved into a thread about Apple vs. MS, but such is life. I mentioned this in another thread and will here again. A downturn in the economy is actually a great time to lay the foundation for a new business model or product line if you have the capital do undertake such an endeavor. In the end it positions you well when things start to turn around and keeps you from playing catch up. Two great examples are Apple Retail Stores and the iPod. Both were launched in poor economy and both proved to be very successful in the long run and have left others playing a certain amount of catch up (more in the iPod space than retail). That said, I question Dell's ability to bring something new to the market. Dell excels at manufacturing operations, and being a low cost leader. These are not things to scoff at and have served the company well but they do not lend so much to product innovation and don' t translate to markets that are more interested in features than cost. In my opinion this is what caused them to fail with their ventures into digital music players, TVs and an online music store. In all cases they really didn't do much in the way of the development and relied on third party software. I am not sure Dell has the ability to develop a compelling phone in the way that RIM, Apple and presumable Palm has. Development just isn't Dells gig, but you also don't succeed without trying. Good luck to them.
bettieblu
on Mar 23, 2009
Master you miss your meds? Honestly can you say from a business perspective that the Zune, or Xbox has been a financial success? I do think that the Apple TV is a failure. But only because it came to early. If Apple could have had a subscription based movie rental service like Block Buster or Netflix did via snail mail, with the same level of content and a monthly fee it would have been a hit. I doubt they could have if they wanted to with the movie industry involved though.
Master3
on Mar 23, 2009
@ bettieblu I illustrate the absurdity of posting like Lindy's by being as absurd. I'm not going to say one product is financially successful or not. All companies have devices, products, and services that make money, and ones that do not, but serve as areas where that company can try new ideas to enhance their existing line-up or cultivate new markets for themselves. If MS sees a good thing in providing us with devices like the Zune or Xbox, even if they are not as profitable as Windows or Office, then that should be applauded as much as Apple providing AppleTV or OSX when they dont make the money like the iPod. Not every damn thing has to be about "making dents", a term which cant even be defined the same by any 3 different people. Let the people enjoy what is being created, and hope that the desire of companies to have divisions with good products that dont make lots of cash continue for whatever reason.
tayme
on Mar 23, 2009
@bettieblu - "But only because it came to early." I'd say that Apple TV came too lat, not too early. MS already had that locked up with Windows Media Center...which offers much more than Apple TV and with a 360 extender widening the gap, it is much too late. Regarding the statement by Paul, "If you can't make a dent, don't bother", I sure hope that was a case of him being a smart a s s and hoping for hits from that comment. Master3 hit the nail on the head...and it is something that I have been saying for months here...the only thing that you missed Master, was that it is the zealots on both sides that are too stupid to get it. --tayme
Master3
on Mar 23, 2009
@ModernDislocation "I mentioned this in another thread and will here again. A downturn in the economy is actually a great time to lay the foundation for a new business model or product line if you have the capital do undertake such an endeavor. In the end it positions you well when things start to turn around and keeps you from playing catch up." Exactly! This is the time for those companies to position themselves for the next boom. There isnt lots of money out there, so they take a break from sky-high profits and plan the next big thing.
bettieblu
on Mar 23, 2009
@tayme too late? Name a successful online digital video content delivery service that rivals the snail mail/store front success of Blockbuster and Netflix? Many are trying, but none have gotten there yet, mainly because its too early. Right now, NetFlix, Apple, Blockbuster, Amazon, cable/satellite and a few others are trying digital delivery but most dont have the selection or price of a NetFlix or BB in the mail. The primary goal of Apple TV and Windows Media Center are different, and I dont even see them as competitors. Apple TV was mean to be a super simple (look at the remote) way of getting video content from the iTunes store directly. It has secondary goals and has added some more function but it has a limited focus and that is direct delivery of digital content from the store with a super simple interface. Windows Media Center is a home media hub first. Its been all over the map, first it was only to hardware vendors as a complete package because of strict hardware requirements then it was put into Vista. Its way more complex for joe user than Apple TV and there is no "store" like iTunes. Xbox has a store, but its selection is horrible, and that is with the sad online Netflix collection. Windows Media Center has been a failure as well over all, even Paul has said so....not matter how cool it is. Somebody will crack the digital delivery/subscription model, once the movie companies finally cave. I personally think it will be NetFlix since they have a huge library most of which can only be had via the mail, but they have an offering of mostly older SD movies online. They have the content, and they have partners, Xbox, that box the sell etc. Apple could pull it off with iTunes simply because its huge already, again the movie vendors have them all by the sack right now.
bettieblu
on Mar 23, 2009
I agree if you have LOADS of capital laying the foundation now for "niceties" that people will want after a long down economy would be a great place to be. That pent up demand will be there. That said its VERY risky, timing is everything and again LOADS of money to burn through while people hunker down and focus on the necessities.
subzerohitman721
on Mar 23, 2009
What bugs me about the logic of some of these folks on here that "it doesn't make a dent, don't bother" philosophy, is that you can start badly and end up getting somewhere rather fast. Or you can start ahead and fall behind and play catch up. This folks is Microsoft and Apple history. Apple started with a One Hundred Billion Dollar headstart on the GUI. Xerox was so far ahead of its time, only to hand it away to Apple. Apple got engineers from Xerox Parc before and after that famous visit. Only for Microsoft to get ahold of Macintosh prototypes, build Windows from crappy 1.0 start to 3.0. From 1993 foward, they were the top OS maker in the world. Since 1993, Apple has never come back to 1st place. As Paul has pointed out, Microsoft's biggest competition is pirated copies of Windows. Microsoft didn't win by an inch or a mile, they won by 10 miles. The Apple base of computers is estimated at about 25 million users world wide. The Microsoft base is estimated about 1.1 billion users world wide. Think about that for a minute. 1.1 billion versus 25 million. By the end of 2009, the estimate is that 1.2 billion total PC users world wide. The world population is only estimated at 6.76 billion. Plenty of folks out there to do business with. By any estimate, Microsoft is king. However, Apple being in the number 2 slot, still has a strong enough voice and innovative position to influence the number one guy. If you look at what Ubuntu Linux has been doing, they are in a strongly innovative position as well. So you don't have to be number one to win. It was Steve Jobs himself who said, 'We have to get past this notion, that for Apple to win, Microsoft has to lose." Macworld 1997. Its on You Tube. This can be applied to Zune, to Mac Mini, to Xbox, and what have you. There are enough people in the world to have more than one or two OSes. How many car manufacturers are there? How many auto partsk makers are there? How many burger joints can you find on any given day? Just because you're not top dog, doesn't mean you just surrender. Competition is necessary for growth, innovation, and change. If Apple just uped and quit, I would be disappointed. They still have a lot to say in this industry. They still do a lot of things that keeps everyone on their toes. So I don't subscribe that its make a dent or leave. Jack in the Box isn't number one, but they still make plenty of business. Every store brand of cola pales in comparison to Coca Cola and Pepsi, but the stores still make it to compete. With an estimated world population of 6.76 billion people, there's enough slice of the pie for many companies to compete.
whiplash55
on Mar 23, 2009
No one else verifies the Sony and Samsung story, how about a link. Dell could have made a nice smartphone, they make great laptops and their PDA was pretty good. Bad economy though to invest in a long shot, so I guess it makes sense.
bettieblu
on Mar 23, 2009
@subzero you can spin numbers all day. Here are few "numbers" http://venturebeat.com/2008/10/23/microsoft-closes-the-quarter-with-less... How about stock price as another. Its all spin.
bettieblu
on Mar 23, 2009
There have been many rumors about sony and samsung dropping or greatly reducing the win mo phones because they dont sell all that well these days. Here is one from a quick google.... http://www.lockergnome.com/hackonia/2009/03/22/windows-mobile-in-trouble/
benjwah
on Mar 23, 2009
""If you can't make a dent, don't bother" A compelling argument that should also be applied to the "Zune". __________________________________ I would agree with this, but for the fact that they're two quite different markets. Honest to God, the smart phone market? There's iPhone (Apple), Blackberry, Palm, Sony, Samsung, about a billion others. In the MP3 market (or iPod market, just about), there's iPod, and no one else. Sure, there are a few bit players (Zune being one of them), but it's definitely a more appealing market because there does seem to be room for one more at least. That said, if I were in charge of the decision to go ahead with the Zune or scrap it, I'd scrap it.
benjwah
on Mar 23, 2009
Bettieblu: Lockergnome? You choose a rarely visited blog as your "reference"? Do you work as a journo for Foxnews?
Dipsh t Admin
on Mar 24, 2009
Actually, Lockergnome is a an offshoot of the tool Chris Pirillos site. That gives them a very anti-MS bias, more along the lines of MSNBC though. Pirillo gets a thrill up his leg every time Apple says anything. Now, MS DID say that they would be, with the agreement of partners, cutting down the number of different models on the market. They said this at MWC with the release of 6.5. Perhaps that is where the reduction is happening.
lotsamystuff
on Mar 24, 2009
"They should wait and make a device that can wow us " You're talking about DELL, right? That will be a long wait indeed. "If you can't make a dent, don't bother." I don't totally agree with that. The Zune hasn't really made a dent, but it's a decent product with a small but vocal fan base. Sometimes the little guy can be like an annoying dog nipping at the heels of the big behemoth in order to keep that sucker moving. Unfortunately, DELL will never be that effective. Their influence is basically ZERO when it comes to any kind of product innovation (their manufacturing innovation is another story). But if they can make a buck off a few people that don't care about things like style and build quality, who can fault them? I'm sure they appeal to a certain segment of the population. "With an estimated world population of 6.76 billion people, there's enough slice of the pie for many companies to compete." Bravo, "subzero". Your rant hit the proverbial nail on its proverbial head. Well done.
WebGuy3000
on Mar 24, 2009
It's worth bearing in mind that this story isn't about Dell wisely deciding not to pursue a phone, but rather about the carriers issuing a collective yawn at the prospect of a Dell phone. Dell has generally not done well when they venture outside their core competency, which is removing friction from the supply chain in order to offer decent products at an attractive price. All this talk of Zunes and X-boxes and OS X and AppleTVs (all of which do fall well within the core competencies of their makers) is rather beside the point. IMHO.
lotsamystuff
on Mar 24, 2009
"Dell has generally not done well when they venture outside their core competency, which is removing friction from the supply chain in order to offer decent products at an attractive price." Yeah. What he said. ^^^
bettieblu
on Mar 24, 2009
@benjwah it was just a google hit. Here are more. Palm will probably be next if they dont get bought out by someone, and their new OS takes off. http://www.modaco.com/content/pocket-pc-professional-news/284632/mwc-200... http://news.cnet.com/8301-17938_105-10042193-1.html
de Silentio
on Mar 24, 2009
"If you can't make a dent, don't bother" Companies need to try differnet things, it is better to make a $100,000 mistake than miss a $1,000,000 dollar opportunity.
Waethorn
on Mar 24, 2009
"It's worth bearing in mind that this story isn't about Dell wisely deciding not to pursue a phone, but rather about the carriers issuing a collective yawn at the prospect of a Dell phone." It IS wise for Dell to persue the phone business. They do have a rather large stake in business IT the world over. Adding smartphones to that collection, however "average" they may be, would be welcome by corporate IT if they can integrate with their existing products and offer good support. FWIW: HP is already doing this. They have corporate smartphones that are by all accounts "average", but they also have something that Dell presently doesnt: customers that are buying them because they know that HP is providing stability for IT asset management. Dell isn't playing catch-up to anybody except HP.

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