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Dell to Launch Android-based Smartphone with China Unicom

Updated:2009/7/15 14:33

US-based PC maker Dell will have a launch of a smart phone by teaming up with China Unicom (SHSE: 600050) this fall, disclosed Collins Stewart analyst Ashok Kumar. The smartphone will be based on Google's operating system Android and manufactured by Taiwan-based contract producer Foxconn.

Mr. Kumar notes that other telecom carriers have decided to pass on Dell handsets, and adds that it is unclear if this Edge-based phone, based on Marvell processors, will see any traction.

Though the global PC market is slowing down, PC giants have not moved away from their insistence on expansion into China.

"We are still confident in China's PC market in 2009 although the rapidly worsening global financial crisis has eroded the consumer confidence," says an executive from Dell China. "The market will be stimulated by a string of preferential policies launched by the Chinese government. And Dell will focus on Netbooks and low-price computers aimed at the vast much less developed rural markets this year."

China will grow into the biggest IT market in the world in years ahead. And the notebook computer market in this country will maintain a good momentum of growth in 2009. It offers a big opportunity to PC makers, Mr. Yang notes. To ride the boom, Dell has made an adjustment to its distribution channel and product lineup.

Dell made a statement on July 13 saying that stabilizing demand would boost sales sequentially in the current quarter, but that its profitability would slip.

Dell also said customers continue to defer purchases, but that year-over-year demand for its products appears to have stabilized.

The company didn't quantify how large the quarter-on-quarter increase in revenue for the quarter ending July 31 would be. But its comments suggest a pattern of falling sales, it has posted three consecutive quarters of shrinking sales and profits, was coming to an end.

In a statement, Dell said it is targeting 5% to 7% compounded annual sales growth over the longer term, which is above Wall Street expectations.

While customers continue to postpone purchases because of the recession, Dell Chief Financial Officer Brian Gladden said the company is confident that it will see demand return to more typical levels at some point.

Dell could benefit from a pickup in business that would aid its turnaround efforts. A host of new products haven't done well, and last quarter Dell reported revenue tumbled 23% annually to USD 12.3 billion. Analysts expect revenue of USD 12.55 billion for the current quarter.

 

Source: enet

 Source:Source: enet
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