We'll Learn Tomorrow If Google's $12.5 Billion Bet On Motorola Paid Off

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Tomorrow, we learn what $12.5 billion buys you.

At 3 p.m. Eastern, Motorola will formally unveil the Moto X, its newest flagship smartphone and the first product developed under Google’s guidance. Google bought bought Motorola for $12.5 billion in 2011¬†and has been running the company as a separate hardware unit since the deal was finalised in 2012.

That’s when Google installed Dennis Woodside as the new CEO of Motorola, replacing Sanjay Jha. Woodside helped oversee the Motorola acquisition for Google in 2011 and 2012 and has been a Googler since 2003.

But Motorola still had an older product pipeline to burn through before it could start working with Google, which is why it introduced three lackluster Droid-branded smartphones on Verizon. The company threw one of the saddest smartphone launches ever for those new Droids last fall. (It happened on the same day of another big smartphone launch, Nokia’s Lumia 920. That event got a lot more attention.)

So the pressure is on for Motorola tomorrow. With the Moto X, it has to prove that it’s worth the $12.5 billion Google shelled out. It has to prove it can still innovate. It has to prove it can make a device with enough of a “wow” factor to get people to overlook the iPhone and Samsung’s large Galaxy portfolio and try something new.

That’s no small task.

The high-end smartphone market is nearing saturation. Most people who want a new top-of-the-line smartphone already have one. And if they do, it’s probably an iPhone or Samsung Galaxy device. That’s why Nokia and other Windows Phone makers have been attacking the low end of the smartphone market with cheaper devices. It’s also why Apple plans to make its rumoured “cheap” plastic iPhone.

The only way Motorola could possibly hope to compete is on price. Offering a premium smartphone with a ton of great features with direct support from Google for next to nothing could be enticing to some. There have been whispers that the Moto X will be priced to move, but nothing has been confirmed yet.

Based on the early leaks though, there’s nothing about the Moto X that seems like it can break out the way Motorola hopes it will. It will reportedly be customisable, letting you choose your own colours for the body and add laser engravings. Woodside has already said that the phone will be packed with intelligent sensors that make certain tasks easier. For example, a leaked video shows that you’ll be able to launch the camera app just by twisting the phone.

Those will all be nice perks for some people, but they’re probably not worth $12.5 billion.

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