Unpacked This Week

Motorola’s Bet on Modular Design may be the Future but not Today – Carolina Milanesi

On Thursday at Lenovo’s Tech World, Motorola announced the Moto Z and Moto Z Force. The two high-end devices sport a solid feature list which would make them a good upgrade for current Moto X or Droid users. However, the focus was not so much on the devices per se but a new concept called Moto Mods, a modular approach that allows users to snap on different accessories to turn their phone into different things. At launch, Moto Mods included the JBL SoundBoost, the Moto Insta-Share Projector, a Power Pack, and designer Style Shells. Swapping these modules is very easy thanks to a new proprietary high-powered magnetic connection that allows for a hot swap so you do not have to stop listening to music or watching a video before you attach a speaker or projector. Moto Mods come with their own Developer Program and one million dollars in equity funding, provided by the Lenovo Capital and Incubator Group, for the individual or company that creates the best Moto Mods prototype by March 31st, 2017.

This is not the first time we’ve seen a modular phone. Just over a year ago, Google launched Project Ara and, at the Mobile World Congress, LG introduced the LG G5. In a blog post that accompanied the launch of Moto Z and Moto Mods, Motorola states they are ending incremental innovation and are empowering consumers to make what they want out of their phones without having to compromise. I certainly agree with incremental innovation and I also agree that, in many cases, trying to turn your phone into the kitchen sink results in a big compromise. The reality is that we do not need everything all the time.

That said, the reality is also that add-on accessories have never been very popular with consumers because they become another item to remember to carry. It is no coincidence the phone market took off once camera functionality was integrated into a phone — not when the camera came in a snap on accessory. Costs for the different modules might also be a limiting factor for consumers who mostly continue to see their main smartphone costing $200 or thereabout. Another concern consumers might have is how much these Mods will limit their ability to choose in the future. While Lenovo did the right thing in reassuring buyers they are supporting Moto Mods for years to come, a consumer might still feel that, if they invested in Mods, they will be stuck with the Moto Z future iteration rather than being free to buy, say, the next Moto X.

The aggressive pricing of the SoundBoost and the Style Shells are the Mods with the biggest opportunity, in my view. Overall, however, I do not think this will be a big sales driver in the short term.

iMessage to Android? – Ben Bajarin
One of the more curious leaks prior to next week’s WWDC is one speculating that Apple is preparing to bring iMessage to Android. I count myself in the “I’ll believe it when I see it” camp. iMessage has been fairly strategic to Apple as a mechanism to drive switchers from Android. While iMessage (and the broader friends and family on iPhone theme) is not the only reason, it is one of many. However, if Apple intends to bring Siri to iMessage as a chat assistant on top of an audio assistant, it does make sense to start thinking cross-platform with this service. Also, if Apple intends to add commerce capabilities to iMessage so you can purchase things within it, it also makes sense to think cross-platform.

Another angle could be the way Apple’s machine learning can get smarter the more people are using iMessage and Apple is analyzing more data for their broader AI ambitions. This would be another reason to try and get as many customers as possible for your service.

Lastly, the more Apple starts to think like a services company, even if they are not and will not be a services only company, it does make sense to start having some pillars of your services be cross-platform. The AI/smart assistant platform is one of those and perhaps taking iMessage and other services like their eventual TV solution to other platforms does make sense strategically. All that being said, I’m somewhat skeptical Android users will abandon whatever messaging app they are using and jump to iMessage. Our research validates that Android users are very low-engagement consumers with not just smartphones but technology in general. Meaning, they typically just do the very basic things and are not out vetting the best apps for all their needs. Apple may have the clout to have some success but even Google can’t get the Android crowd to download a critical mass of their first party apps.

This is one rumor I’ll be very interested to see if it is true.

Snapchat and Hardware Ambitions – Ben Bajarin
Interestingly, Snapchat continues to explore hardware ambitions. I have made the point many times that the hardware companies of today are likely not the hardware companies of tomorrow. However, that observation has usually been followed by mention of the Chinese as the primary future hardware companies in many categories. Overall, I make this point because those who are only hardware companies will have a rough future. The companies who are able to make money in more ways than hardware become the most interesting types of businesses. It is through this lens I find Snapchat’s hardware ambitions interesting.

Most reports since the discovery of their hardware-centric hires have speculated Snapchat is interested in some kind of augmented reality product. Perhaps it is also some type of VR product as well but, given their business being primarily video and video ads, it makes sense they don’t want to be left out of any hardware opportunities in AR/VR. That being said, hardware is hard and most hardware engineers, particularly the top talent, are all working at companies where hardware is a higher priority. Snapchat is not yet getting top talent and without them, any serious hardware ambitions are muted. It is likely more experimentation of something they may do someday. But it is still interesting to see the type of company Snapchat believes they are and where they feel they can go with these type of hires.