Motorola CEO: Don't worry, cheaper Moto X in the works

Motorola will have a less expensive Moto X for the U.S. prepaid market and developing markets within a few months, the company said Thursday after the Moto X launch event in New York.

A cheaper version of the Moto X will be introduced in the coming months for the U.S. prepaid market as well as for developing markets, where phones aren't usually subsidized by carriers. Sarah Tew/CNET

NEW YORK CITY -- Price-sensitive consumers may be turned off by the $199 price tag of a Moto X with a two-year contract. But a cheaper version of the product is likely on the horizon.

In an interview with CNET Thursday, Motorola Mobility CEO Dennis Woodside said that the flagship Moto X is just one of many new devices coming out under the Moto X brand in the coming months.

Motorola announced the new flagship Moto X at an event here on Thursday . The company said the 16GB version of the device would be available with a two-year contract from each of the four main wireless operators -- AT&T, Verizon Wireless, Sprint, and T-Mobile-- for $199. It will also be available for that price on regional carrier, U.S. Cellular network. The company hasn't yet disclosed how much the device will cost at full price with a contract on one of these carrier networks.

Next on the company's hit list is a device that is less expensive than the current Moto X. The device will be designed and priced to appeal to international customers in markets where people generally don't buy subsidized devices, as well as the prepaid wireless market in the U.S., where wireless consumers are also expected to pay full price for devices.

In many cases, the best smartphones retail for $600 or more. Finding devices that are priced much lower is difficult and consumers often have to make sacrifices in quality, he said.

"The experience of devices you can get for less than $200 is subpar right now," Woodside said. "We want everyone to have access to affordable smartphones."

Woodside said that in developing markets, where devices aren't generally subsidized by wireless operators, consumers are especially price-sensitive. But he also noted that the U.S. prepaid wireless market, which is growing fast, is also ripe for new, lower-cost devices. He said that right now customers are being asked to buy 2- or 3-year-old technology just to be able to afford a smartphone on a prepaid plan.

Moto X Sarah Tew/CNET

Other handset makers, such as Samsung, have begun introducing lower cost versions of their flagship devices for these markets. For example, the Samsung Galaxy S4 Mini is one such device.

And there have been rumors that Apple may also introduce a less expensive iPhone for developing markets. It's unclear if such a device will be introduced and if it is, whether Apple will make it available for prepaid carriers. For most people wanting a less expensive version of the iPhone means buying an older version of the device.

Woodside said he wants Motorola to be able to offer cutting edge technology at an affordable price, so that cost-conscious consumers don't have to choose between spending a lot of money on a device or buying older, outdated technology.

"Buying a new iPhone at full price for a prepaid service costs quite a bit of money, especially families who are buying devices for multiple people," he said.

Nokia is trying this same approach with its Lumia line of products. And so far the company is seeing strong demand for its low-end Lumia 520 and Lumia 521, which use the Microsoft Windows Phone 8 operating system. The Lumia 521, which is sold without a contract on T-Mobile, costs less than $200. It has been selling out at T-Mobile and through re-sellers, such as Wal-Mart almost on a weekly basis since it was introduced this spring .

Woodside wouldn't give specifics of which features would still be included in a cheaper Moto X or when such a device would hit the market. But he noted it's coming.

"Moto X is the brand that we are most focused on," he said. "And there is more to come. You will see additional products within months."

 

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