Tuesday, December 13, 2005

Motorola to benefit from price war over Razr

Crain's Chicago Business reports that Motorola stands to gain from a price war between Cingular and Verizon over the popular Razr during this holiday season.

Verizon is set to launch the CDMA version of the Razr soon, and Cingular has countered by "slashing prices on its models, first introduced a year ago." Cingular is now offering the Razr "to subscribers for as little $99, after a 33% rebate. Verizon responded yesterday with an extra $20 rebate for its new version of the phone, bringing its price to $179."

Albert Lin at American Technology Research said, I’m sure Cingular did it to take some of the wind out of Verizon’s launch." Lin noted that "Verizon and Cingular appear willing to forego money on the handsets in order to lock in new customers to two-year contracts."

Lin added, "If consumers have a choice between the Razr versus other (mid-priced) products, they’re going to choose the Razr.”