iPhone May Sell Fast, But Not RAZR FastS

Click to viewIt's no wonder Steve Jobs got into the phone business. He introduced the iPod in October 2001, and by April 2006, he had sold over 50 million of them. Now, 50 million units in less than five years is good, but Motorola sold 50 million RAZRs in less than two. It took Motorola months to reach 750,000 in RAZR sales, a feat Apple may achieve by the end of the iPhone's first week. Does this mean Apple will beat Motorola's cellphone sales speed record?

It's early, but Apple is certainly off to a strong start. As we mentioned earlier, Bloomberg reported that 500,000 to 700,000 iPhones were estimated sold over the weekend, at $500 to $600 apiece. Motorola by contrast took much longer—the final three months of 2004—to sell 750,000 RAZRs. The GSM RAZR sold by Cingular, you'll recall, cost $500 at launch.

Forecasts for 2005 RAZR sales were initially conservative, but a sudden desire to get aggressive sparked the move to push RAZR hard: Instead of building 2 million in 2005, it would build 20 million. The trajectory was set, the marketing masterwork was staged. RAZR sold 5 million units in the second quarter of 2005, 12 million in the third quarter, and by July 2006, two years after its unveiling, 50 million had been sold.

Jobs has set much lower goals for the iPhone: He wants to sell 10 million in 18 months. While this may represent the fine art of underpromising and overdelivering, there are good reasons for aiming significantly lower than Motorola.

• For one thing, the iPhone is exclusive to one carrier (AT&T) and one technology (GSM), whereas the RAZR was eventually sold by every carrier on both GSM and CDMA networks. Without Sprint and Verizon Wireless, the iPhone reaches less than half of its potential US customers.

• Motorola's sales were worldwide, while the iPhone is currently only sold in the US. Although there is buzz that Vodafone is vying to carry the iPhone throughout Europe, no plans have been announced.

• In addition, iPhone falls into the "smartphone" category in many people's opinion, and the market for smartphones is significantly smaller than the market for, well, dumb phones. Besides, corporations dominate the smartphone business, and the iPhone is not even sold through AT&T's business division.

Iconic branding and aggressive sales speculation aside, there is a strange kinship between Apple's objet du moment and Moto's has-been superstar. It was Jobs who inspired Ed Zander when he planned a full-fanfare keynote RAZR unveiling in Chicago in July 2004. We all know the story of the subsequent, ill-fated partnership between Jobs and Zander—iTunes ROKR RIP—but even after that divorce, the eerie links continue.

Just compare the two phones. The RAZR changed the position of side keys and leveled the traditionally exposed keypad, to some criticism; the iPhone eliminated the keypad all together, to similar skepticism. Motorola chose glass for its exposed RAZR screen and strong anodized aluminum for the body; the iPhone designers made similar choices for style and durability. In a radical move, Motorola engineers put the phone's antenna on the bottom, below the mouthpiece. Where's the iPhone antenna? Yep, same spot.

Additional Sources:

RAZR'S Edge [Fortune]

Apple's music biz, iPod share grows [MacNN]

Motorola Ships 50 Millionth MOTORAZR [Geekzone]