Motorola Launches $120 Android Handset

Since last year, Microsoft has been pushing inexpensive Lumia smart phones in a bid to make up lost ground in the smart phone market. But this week’s release of an unlocked $120 Moto E Android handset is just the latest reason why the software giant is going to run into problems even in the low-end of the market. That is, if Microsoft can do it, so can Android handset makers.

As a fan of Windows Phone, I’ve gotten a bit antsy about Microsoft ignoring the high-end of the market for so long, and of course I recently bought a Microsoft/Nokia Lumia 930 which I like quite a bit and recommend, even to users in the United States.

But I also understand and even appreciate Microsoft’s low-end strategy: after stumbling badly with the terrible Lumia 530, the firm has rebounded nicely with a growing range of high-quality low-end and mid-level handsets like the Lumia 535, Lumia 730/735, Lumia 830 and, more recently, the Lumia 435 and 532. These devices all offer tremendous value for the money and they serve a diverse audience that includes emerging markets, of course, but also value-conscious consumers in established smart phone markets like the United States. The best value to be had right now is the no contract version of the Lumia 635, which costs just $50 at Amazon.com right now. But if you can afford a little more, the $130 Lumia 535 (unlocked) is an even better device.

The problem, of course, is that the bargains aren’t just there for Microsoft’s devices. And Google, which makes the world’s most popular mobile OS, Android—which accounts for 81.5 percent of all smart phones sold in 2014, compared to just 2.7 percent for Windows Phone—isn’t sitting still, nor is it giving Microsoft a chance to gain a foothold in emerging markets. And while I may have my own opinions about the quality of Windows Phone vs. Android, it’s impossible to pretend that most customers won’t choose the known, popular platform—Android—over Microsoft’s.

In 2014, Google announced its Android One initiative, which appears to be cribbed directly from Microsoft’s Lumia playbook. This program targets an estimated 5 billion people that will be buying their first smart phone in the coming years, and it provides some unique standardization that will, among other things, keep users and their phones up to date, particularly with security fixes. But the primary aim of Android One—as with Microsoft’s low-end Lumia strategy—is to provide high quality, low-cost devices to customers.

But the low-end phones aren’t just relegated to emerging markets. Taking advantage of the same low-cost hardware components that Microsoft uses in Windows Phone, Android device makers are starting to ship a growing range of inexpensive Android smart phones too. And they’re doing so in the US and other established markets.

This week, Motorola launched the second generation version of its Moto E entry-level smart phone. This handset actually starts at just $120 unlocked, though that version lacks 4G/LTE capabilities. If you need/want 4G/LTE, you can get a Moto E right now for just $150.

What you get for that $120-$150 is a 1.2 GHz quad-core Qualcomm Snapdragon 200 processor (in the 3G version, or 1.2 GHz quad-core Qualcomm Snapdragon 410 processor in the LTE version), 1 GB of RAM, 8 GB of internal storage with microSD expandability, an admittedly paltry 5 MP rear camera, a VGA front-facing camera, and a 4-inch screen at 540 x 960.

These specs are very similar to that of the Lumia 535 I like so much, which provides the same 3G networking, 1.2 GHz quad-core Qualcomm Snapdragon 200 processor, 1 GB of RAM, 8 GB of internal storage with microSD expandability, 5 MP rear camera, and 540 x 960 display. The differences are the Windows Phone OS, of course, and that the Lumia 535 has a 5-inch screen (which I prefer, though the PPI is lower) and a wide-angle 5 MP front-facing “selfie” camera.

The Moto E offers some nice accessories for customizability—another Lumia trademark—and all-day battery life. And of course Android.

Worse, the mainstream press is loving this device.

The personal tech columnist for the Wall Street Journal thankfully spared us one of her cringe-inducing video reviews, thankfully, but noted that the Moto E “has the potential to turn the wireless industry on its head,” in part because it’s unlocked, and it part because it’s just a nice phone at a great price.

Over at the New York Times, the reasonable Molly Wood calls out the Moto E for exactly the same reasons I do: “For $150, you can get a model that supports 4G and has many of the software features of higher-end Motorola phones, like the Moto X, as well as a fast processor, the latest version of Android (Lollipop) and a selection of accessories for personalizing the phone,” she writes. And kudos to Wood for describing the Lumia 635 as “a top option” in this market segment. “It is attractive, easily personalized and easy to learn for those new to smartphones,” she says. Yes it is.

Put simply, this part of the market is important, since this is where the volume growth will be. Unfortunately, it appears that Android, and not Windows Phone, is most clearly poised to continue to take advantage of this market. And I just don’t see what Microsoft can do about that.