Dell smartphone attempt falls flat

DELL MAY FEEL it has tapped in to its design Mojo, but smartphone makers seem to disagree, turning their noses up at the computer maker's first attempt at making big-margined, little handsets.

Shaw Wu, an analyst at Kaufman Bros, reckons Dell showed off prototype smartphones to mobile carriers in the hope they'd swoon and cough up the cash to make them. Rather than being bowled over by sleek, mobile sexiness, however, carriers apparently rejected the prototype as too "Dell-like" and knocked their "lack of differentiation". Ouch!

Dell's prototypes purportedly included bricks mobiles running both Windows Mobile and Android. But Wu notes the firm was told in no uncertain terms it would have to, "go back to the drawing board" and design a mobile with enough differentiation to compete with the likes of Nokia, HTC, Samsung, LG and others if it wanted carriers to become remotely interested in its proposition.

"In our view, the last thing Dell needs is to enter another money-losing business as it seeks to preserve its operating margins of five to six per cent", writes Wu.

Despite being cruel to be kind, however, Wu adds that Dell doesn't seem ready to give up just yet though, declaring, "Dell remains committed to the cell phone space as it appreciates the opportunity in smart phones and the longer-term cannibalisation potential of PCs."

Dell could now feasibly look into building a new prototype including some sort of vertical integration, software and/or services. It could also mean the computer maker might pull an Acer and buy out a phone maker to help it dial into the lucrative market.

Wu concurs with this theory, noting that Del is, "contemplating making acquisitions to help in this effort".

Brace yourselves for a pretentious Adamo-style mobile phone folks. µ

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