Motorola's Double-Edged RAZR Success

This column was originally published on RealMoney on July 21 at 3:46 p.m. EDT.

To forecast Motorola(MOT Quote) in the autumn of 2005, let's talk about Samsung in the autumn of 2003 and what one hit product can mean for a low-double-digit mobile-phone brand.

Back in 2003, Samsung had just consolidated its No. 3 position in the phone market, having elbowed out Siemens (SI Quote) after an evenly matched battle. Samsung's market share at the end of 2003 stood at 10.1% -- a decent, though somewhat precarious position. Then came the E-700, and Samsung was transformed. In six months, the hot clamshell with a luxurious, 65,000-color display helped boost Samsung's market share to 14.8% from 10.1%. The company had other popular models out, but this single model transformed Samsung in major GSM markets, helping add nearly 5 percentage points of global share in just half a year.

The media loved the story, and Samsung was the cover girl of both technology-oriented magazines and business publications, and phone experts began projecting 20% market share. But Samsung's market share peaked in the second quarter of 2004 and has not reached that level again. The market share may have slipped to 13% during the second quarter of 2005. ...