Comments on: Dell Cell Phone Lacks Differentiation

By: Sridhar Oruganti

Sridhar Oruganti — Wed, 01 Apr 2009 16:12:09 +0000

One way to ‘differentiate’ itself is replicate its business of selling PC’s/accessories.
So whats the USP of that Biz ?
Acc to me the ability to customize.Now think of this : If Dell could offer a bare bone mobile with components that could be customized.
Ex : I would prefer a longer talk time to having a 3 MegaPix camera.
Might be challenging but would change the way mobiles are sold right now.

By: Scott Sehlhorst

Scott Sehlhorst — Thu, 26 Mar 2009 23:56:12 +0000

:). Who better to cannibalize your market than yourself?

By: Stewart Rogers

Stewart Rogers — Thu, 26 Mar 2009 18:22:23 +0000

Did you just work in analogies from all three books from the book club?

I am pretty sure the mobile phone will obsolete the home PC.

Stewart

By: Scott Sehlhorst

Scott Sehlhorst — Thu, 26 Mar 2009 16:23:41 +0000

@Stewart: Thanks! The dirt cheap option is an interesting one. Definitely competition in the “red ocean” space – but it might work really well, if the choices for consumers are (1) free Dell phone or (2) free featureless-phone or (2) cheap comparable-to-Dell-phone. The “power of zero” might work in their favor.

After spending over a year working with Dell groups, I’m comfortable that this won’t be a distraction for anyone (except maybe at the highest levels) – they have very independent teams, so it isn’t like there’s a guy trying to design both cell-phone features and EqualLogic products, or both cell-phone positioning and retail PC strategy. It would be dilutive only in terms of dollars, and possibly executive attention.

Your idea about peripherals is an interesting one, and parallels my thoughts on ecosystems, in that it would identify an area of the market that is severely (entirely?) under-served, thus differentiating their offering.

By: Stewart Rogers

Stewart Rogers — Thu, 26 Mar 2009 13:20:54 +0000

There are some great lessons from this. Thanks!

Given that the mobile phone market is so competitive and moving so quickly this is going to be a tough market for someone like Dell to break into. Both Apple and RIM are probably prototyping stuff for 2011-12 now, which means Dell needs to be 1 year ahead of them. The other option is to build a me-too phone and do it dirt cheap. Problem with that – the phone companies are already giving phones away for free.

I hope this doesn’t become a distraction for Dell. Their core competencies seems to be computers and peripherals. If I was them, I would be working on peripherals for the mobile phone that allows it to become a functional PC.

Stewart

By: Scott Sehlhorst

Scott Sehlhorst — Thu, 26 Mar 2009 03:55:38 +0000

@David: Thanks for the comment. As to the urban legend elements – looks like Michael Dell has “sort of” confirmed this – http://www.dailytech.com/Michael+Dell+Confirms+MID+or+Smartphone+is+On+the+Way/article14671.htm

Dell isn’t in the business of customizing electronics, btw – among other things, they sell computers. The fact that they allow ‘build to order’ in some channels (but not retail) is a particular execution strategy. It actually creates an interesting situation with retail, since they’ve optimized their operations to minimize the cost of customization. Retail requires massive orders (truck-loads at a time) of identical configurations. When a process is optimized for customization, by definition, it is not optimized for duplication. So, there’s added cost for Dell (relative to what it could be, not necessarily relative to competitors).

By: Alexei White

Alexei White — Tue, 24 Mar 2009 09:00:09 +0000

Dell’s “MePhone” actually more like a “Me Too” Phone. A lack of differentiation keeps carriers from jumping on board: http://bit.ly/pN6iK

By: David Alfaro

David Alfaro — Tue, 24 Mar 2009 05:36:08 +0000

Dell Cell Phone Lacks Differentiation http://bit.ly/pN6iK #ProductManagement

By: Jim Holland

Jim Holland — Tue, 24 Mar 2009 04:25:18 +0000

RT @sehlhorst: Tyner Blain: Dell Cell Phone Lacks Differentiation http://tinyurl.com/cagnmj @jim_holland When Market Sensing is not complete

By: Roger L. Cauvin

Roger L. Cauvin — Tue, 24 Mar 2009 04:05:01 +0000

RT @sehlhorst: New Tyner Blain article: Dell Cell Phone Lacks Differentiation http://tinyurl.com/cagnmj #prodmgmt

By: David Locke

David Locke — Mon, 23 Mar 2009 22:25:42 +0000

I thought Dell was in the business of customizing electronics to order. So if Dell was going to get into the cell phone business, that would be way cool! You could order your display and mix and match the various elements that comprise a cell phone. You could have a phone that did whatever it is you wanted a cell phone to do.

The problem would be the telcos. The telcos are slow. They are well behind technologies available in other countries. The U.S. is a cell phone laggard. The telcos focus on churn.

Annoto built a handwriting technology based on a bluetooth pen and an infrared grid that the pen could read. Any piece of paper could serve as a web interface. But, no, no uptake by the telcos. They were not ready to support bluetooth, so years have passed. Annoto didn’t go it alone. They had a wide portfolio of partners. Still, when I called wanting a million pens, nope, they didn’t have the manufacturing capacity, so the experiement will have to wait.

It’s not just the lack of differentiation that Dell faced. It’s not just Dell’s alleged lack of product managers. It’s more like a failure to gain entry into the telco universe. They needed the business relationships before they sat down to design any cell phone.

My vote is that the story is another urban legend.