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That kind of hand-wringing about margins gets under Zander's skin. At an investors' conference in September where he intended to promote the Rokr, he was instead peppered with questions about how the company would shore up its profit margins once sales of the Razr start to slow. At the end of the meeting, an exasperated Zander started venting to an attendee about the evils of short-term thinking on Wall Street. "I work for shareholders," he said in an interview in his Schaumburg, Ill., office three weeks later. "But, that said, are you a long-term shareholder or a short-term shareholder? There seems to be more and more of a focus on short-term results, which makes investing for the longer term that much harder."
For investors willing to stick it out, Zander has a bold vision, one that focuses on the next decade's hot new country rather than the next quarter's hot new product. Even as Motorola continues to develop high-end phones, he is pushing the company to go after the lowest end of the spectrum: a sub-$40 phone aimed at farmers and the striving urban masses in India, several nations in Africa and, to a lesser extent, China. But he doesn't want to sell just cheap phones; he wants to transform those markets into a new base of customers for every product the company sells.
India in particular is a high priority for Zander, who has made that country his personal project. His partner on the India team is Warrior, a 21-year veteran of Motorola who was born and educated in India. (Zander tried twice to recruit her to Sun when he was chief operating officer there, and a running joke at Motorola is that he took the CEO job just to work with her.) Instead of flooding India with cheap products, Warrior says, the company is introducing pared-down phones that share a design language with more expensive ones. They use the same accessories and logo, the keypads look similar and the body of the low-tier phones is made of a high-quality plastic that looks and feels like brushed metal. When a farmer in rural India spends a third of his household's monthly income on a phone, she says, "we want to make sure that people are proud of what they have." The strategy is modeled on Nokia's. By far the leader in India, with 65% of the market, Nokia pioneered the portfolio approach to selling phones in a developing market.
Motorola's advertising too is the same no matter where you go, promoting the company's most expensive, best-looking phones. Ron Garriques, who runs Motorola's mobile devices unit, says that even though sales of the Razr in India are small, its image is attracting people to Motorola's other products. "In India only about 1% of the population has the ability to afford the Razr," Garriques says. "The real pull for us is the other 1.1 billion people who can't afford a Razr." To reach them, Motorola is working with local carriers to take their phones into rural areas and in some cases help arrange financing. "We have vans, buses, jeeps, carts," Garriques says. "We go right to them."