Verizon's New Incredible Smartphone

"To be, or not to be--that is the question:
Whether 'tis nobler in the mind to suffer
The slings and arrows of outrageous fortune
Or to take arms against a sea of troubles
And by opposing end them."
-- From "Hamlet," by William Shakespeare, 1601

Sorry, Motorola (NYSE: MOT  ) . Your Droid will no longer be the best smartphone available from Verizon (NYSE: VZ  ) Wireless.

Verizon poured some $100 million into marketing the Motorola Droid, including a series of TV ads that take an antagonistic stance versus the Apple (Nasdaq: AAPL  ) iPhone and AT&T's (NYSE: T  ) wireless network. The Droid became Verizon's "hero" device, the focus of its sales efforts, and Big Red's finest weapon against a sea of troubling rivals. But the just-announced HTC Droid Incredible takes Motorola's phone out behind the woodshed for a solid beating. Motorola's place at Verizon's right hand is in serious jeopardy.

The Droid Incredible is very close to a Verizon-capable version of the Google (Nasdaq: GOOG  ) Nexus One superphone with an 8-megabit digital camera, a large OLED touchscreen, a 1-GHz Snapdragon processor from QUALCOMM (Nasdaq: QCOM  ) , and all the bells and whistles you'd expect from a newer smartphone. It's faster and more capable than the Motorola Droid, and Motorola's only advantage seems to be its physical keyboard … if you're into that sort of thing.

But Motorola will still be very good friends with Verizon for a while beyond the Droid Incredible launch. I don't think Verizon will put serious marketing muscle behind this model, because I don't believe that HTC can supply the network with millions and millions of these phones.

The bottleneck lies in the Droid Incredible's OLED screen. That component is a real selling point for this phone and others, but the technology is not yet ready for prime time. OLED technology from Universal Display (Nasdaq: PANL  ) and others is coming of age right about now, but screen manufacturers like Samsung Display still need to build out their manufacturing lines to keep up with growing demand. Besides, while a nice step forward, the HTC doesn't present nearly the incremental jump that the Droid provided over previous Verizon offerings.

If HTC can't easily order as many OLED screens as it wants, then Verizon can't push its marketing very hard. Nobody looks good when your best gadget is unavailable for weeks or months at a time, and Verizon is doing alright with Motorola's Droid anyway. I'm drooling uncontrollably over the Droid Incredible and might pick one up for myself, but just like the Nexus One I don't think this will be a big seller.

Can Motorola take to arms against this usurper by designing an even better Android phone? I haven't heard any rumors, but wouldn't be surprised. It's a great time to be alive if you love smartphones -- and their impact on the telecommunications market. If anybody wins big in this civil war in Android-land that's pushing rivals to create better products, it's Verizon.

Fool contributor Anders Bylund owns shares in Google and Universal Display, but he holds no other position in any of the companies discussed here. National Poetry Month just isn't complete without a touch of Hamlet. Google and Universal Display are Motley Fool Rule Breakers selections. Apple is a Motley Fool Stock Advisor pick. Try any of our Foolish newsletters today, free for 30 days. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.


Read/Post Comments (3) | Recommend This Article (18)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 15, 2010, at 5:50 PM, daveshouston wrote:

    The problem with reviews like this one is that they focus on hardware. Software is the dog and hardware is the tail. Apple's iTunes infrastructure and amazing app store simply dominate this market. The rest are just pretenders. OLED screens just don't matter.

  • Report this Comment On April 16, 2010, at 9:23 AM, TMFZahrim wrote:

    What if I say I'm not like the others?

    What if I say I'm not just another one of your plays?

    You're the pretender,

    What if I say I will never surrender?

    -- from "The Pretender" by Foo Fighters, 2007

    Sorry, just couldn't help myself. Daveshouston, I dare you to pick up a first-generation iPhone with all the infrastructure and software available in 2010 and then tell me that it's better than a modern Android. Hardware does matter -- and I would posit that the Android platform and app store are not worlds apart from Apple's quality.

    IMFO, of course.

    Anders

  • Report this Comment On April 23, 2010, at 2:06 PM, riethj wrote:

    Here here. There are plenty of reasons why consumers are choosing the Android platform, with or without OLED screens.

    See this analysis on future smartphone buyers considering all Android-platform phones combined over the competition:

    http://www.changewaveresearch.com/articles/2010/01/smart_pho...

    The more carriers, prominent device makers, app developers and users Android gets - the more powerful a force it becomes for tipping the scales against Apple's extremely significant head start in this market. But Apple is still a niche player - and smartphones are moving from luxury/niche items to the mainstream - and HTC, Motorala and of course Google are all poised to cash in on the wave.

    By next year the Android platform will likely be every bit as sophisticated as Apples (I would personally argue it is already as a Droid user, but I'll give you mainstream lead time to catch up).

    All aboard.

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