This column was originally published on RealMoney on Oct. 7 at 2:11 p.m. EDT. It's being republished as a bonus for TheStreet.com readers.Last winter, a strong market share in the nascent 3G phone market was one of Motorola's ( MOT) key advantages. Well, over the past two weeks, Nokia's ( NOK) new high-end phones have captured the lead in the European 3G race, and now the clock is ticking for Motorola, which must get the long-anticipated V3x and A1010 out within weeks to avoid a 3G market-share tumble. This Christmas is widely expected to be a turning point for leading European mobile operators. This is the juncture where these companies begin to push 3G services seriously, trying to shift their customers from the second-generation GSM services to third-generation W-CDMA technology. Last winter, W-CDMA phones were 160-200 gram abominations that were widely shunned by most consumers. This winter's new models are expected to have a better shot at mainstream success. The new wave of 120-130 gram models boast key novelties such as 2-megapixel camera phones and 250-K color displays. Operators are beginning to roll out new promotional programs this October to prepare for the year's most important mobile-phone season -- and the early news flow is downright intriguing. Orange U.K. just announced its ambitious new mobile TV service for 3G networks and said it will be available for Nokia 6630, Nokia 6680 and Nokia N70 models. Almost simultaneously, T-Mobile U.K. announced its new "web'n'walk" service, which is meant to be give subscribers a "true mobile Internet" experience. This 3G service is being launched with five models -- Nokia N70, Nokia 6630 and three white-label phones (MDA and SDA). What is going on here? Why have two major U.K. operators shuffled away from Motorola, even though the U.K. 3G phone market was dominated by NEC, LG and Motorola last winter? Apparently, Nokia has been faster than Motorola in getting out the new generation of 3G phones, which is important because October is the key month for operators since it's when many important promotional programs are locked in for the fourth quarter.
Christmas CliffhangerTwo of Motorola's high-end 3G models are still missing in action as we move into the second week of October -- the A1010 and the 3Vx. The former is an important update of last winter's best-selling A1000, but it's still a 160-gram model. This absence of miniaturization progress is likely to sharply limit its appeal. Several appealing 3G phones with sub-130 gram weights are expected to dominate the retail scene this winter. European operators may well be shunning the A1010 because of the weight problem; just as they seem to be shying away from Nokia's N90, which has impressive specs, but a similar size problem. The difference between Nokia and Motorola is that Nokia has managed to get both heavy (N90) and light (N70, Nokia 6680) W-CDMA models with novel technology out -- but Motorola is so far still tarrying with both the heavy A1010 and the petite 3Vx. The Motorola V3x was widely expected to be the 3G hit of the fourth quarter, but now major U.K. operators have begun announcing their big W-CDMA promotions without mentioning the V3x. Vodafone ( VOD) did include the V3x in its recently announced Christmas portfolio; but that selection included 15 models and was obviously an "all this plus the kitchen sink" type of move. Vodafone Sweden is talking about the Motorola V3x as a November model, which creates high tension for the fourth-quarter volume outlook. If the Motorola A1010 loses the niche that the A1000 had because of the conspicuous lack of weight improvement, the V3x simply must ship in high volumes in order to protect Motorola's 3G phone market share. Ramping up a new and technologically advanced model to high fourth-quarter volumes is usually something that demands an early October or late September launch. November launches are always dangerous. They force operators to make a gamble on including an upcoming model in their promotions and demand a perfectly choreographed series of manufacturing steps to succeed. At the moment, Nokia has grabbed the initiative in the European 3G market by launching 6680, N90 and N70 in a rapid succession while the 6630 is still a solid performer. Motorola is stuck with a notably older product portfolio at the start of the fourth quarter. The exact timetable and the size of the early production run of the Motorola V3x now make it a pivotal event of the season. P.S. from TheStreet.com Editor-in-Chief, Dave Morrow:
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