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Lenovo: We can turn Motorola Mobility around

Motorola Mobility’s red ink will soon be history, according to China’s Lenovo Group, which recently agreed to buy the struggling smartphone maker from Google for $2.9 billion. Today the company’s CEO told Bloomberg that it expects to achieve what Google could not, turning the business around within “a few quarters.”

Lenovo’s supplier relationships and manufacturing efficiencies could indeed turn Motorola’s device business into a money maker. The company could see even better pricing from suppliers as it negotiates from an increasingly powerful position after acquiring Motorola. “As a result of this new deal — assuming it is approved by US, Chinese and other authorities — Lenovo-Motorola becomes instantly the world’s 3rd largest smartphone vendor by volume, behind Samsung (32%) and Apple (15%),” said analyst Neil Mawston, executive director of Strategy Analytics.

Since becoming part of Google, Motorola has launched the first made-in-America smartphone, the Moto X, as well as the competitively priced Moto G, but both have failed to make big headwinds in the market.

Lenovo, meanwhile, has focused its smartphone efforts on the lower end, and has become one of the top five global smartphone makers, along with Samsung, Apple, LG and Huawei. The company says it shipped 13.9 million smartphones during the fourth quarter of 2013, up 47% from the year-ago quarter. Recently, Lenovo has moved toward the higher end of the smartphone market with the launch of the Vibe X.

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ABOUT AUTHOR

Martha DeGrasse
Martha DeGrassehttp://www.nbreports.com
Martha DeGrasse is the publisher of Network Builder Reports (nbreports.com). At RCR, Martha authored more than 20 in-depth feature reports and more than 2,400 news articles. She also created the Mobile Minute and the 5 Things to Know Today series. Prior to joining RCR Wireless News, Martha produced business and technology news for CNN and Dow Jones in New York and managed the online editorial group at Hoover’s Online before taking a number of years off to be at home when her children were young. Martha is the board president of Austin's Trinity Center and is a member of the Women's Wireless Leadership Forum.