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Dell's smartphone move makes sense

Though some Dell fans may wonder about the company's decision, the move actually has good business strategy.

Dell Mini 3 Dell

After years of rumors, Dell finally announced last week that it would make a smartphone called the Mini 3. The handset will run Google Android and will sell in China and Brazil over the coming weeks.

Though some Dell fans may wonder about the company's decision, the move actually has good business strategy. Dell, long synonymous with PCs and notebooks, has been developing a more diverse product portfolio for years. After starting off with printers and digital cameras, the company has evolved into PDAs and smartphones. Some of its offerings have been received better than others so analysts will be watching this move closely.

Considering that smartphones are becoming equally handheld computers and phones, Dell's move into this space makes a lot of sense. Just like PC makers that have had to adapt their products and start offering Netbooks, the smartphone is the next step in the process. And in addition to finally getting into the handset game, Dell is joining other computer companies that see the promise in devices attached to a service provider.

This is a similar move to what Acer did when it announced a smartphone line last year. I suspect that other computer makers will follow this trend just as more phone manufacturers will mimic Nokia's transition to larger, more Netbook-like devices.

So why head to China and Brazil? Well, why not? China Mobile is the largest wireless provider in the world with roughly half a billion subscribers while America Movil, the parent company of Brazilian carrier Claros, has nearly twice the footprint of the largest U.S. carrier, Verizon Wireless. In other words, Dell is going for the gold.

Chances are good that if and when Dell decides to bring the Mini 3 to the United States, they'll enter an exclusivity agreement with a carrier. Why handcuff themselves to someone like Verizon with only 90 million customers when there are considerably larger deals to be had?

Dell and China Mobile have previously worked together with the Mini 10 Netbook, which operates on the carrier's homegrown 3G network.