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BenQ Mobile –
end of the story for Siemens
The history of German Siemens-branded handsets has finally reached the predictable end. What was intended to forge into the lead on the global market of terminals has ended up with a series of financial and social scandals, and now BenQ puts an end to all this. The tension has been intensifying since 2003, when the company’s management went for a couple of wrong decisions, and on top of that, tried to conceal its slips with demagogical rhetoric without making efforts to improve the state of affairs. It can be rightfully considered that the series 45 by Siemens was the peak of the company’s success, while series 55 and posterior line-ups have been dropping down in quality, and consequentially, in popularity on the market.
It can hardly be said that over at Siemens they didn’t realize the established situation – on the contrary, they did. But unlike other companies, this manufacturer made an attempt to overcome the hardships not by finding a way out on their own, but by shifting everything on others’ shoulders. Already in 2002 there were speculations on possible fusion of Siemens with one of the Asian manufacturers – the major given reasons were ever-increasing competition on the market and thus the need in relocation of main production facilities to Asia. Motorola’s name kept on popping up against the background of all these rumors roughly at one time every year. I will take risks of assuming that such statements were to the benefit of Siemens Mobile alone, as these speculations emerged only by the end of company’s financial year and thus influenced its shares. However, the market had gotten used to such “news” shortly and later on came to realize that the company would be sold, so that the buyer’s name was the only thing on everyone’s mind.
In the middle of 2005 it became publicly known that this “buyer” would be BenQ, unknown on the market of handsets up to that time and recognized only on the Asian market, where the company had moderate success. BenQ was occupied mainly with TFT panels, which the company made a good showing with. Setting out to become a player with a world-wide famous brand, BenQ lacked a credible portfolio of devices, so Siemens Mobile’s offer looked very fetching.
In the first half of 2005, Siemens’s mobile division had turned into a real pain as it had been losing from 1,5 to 2 mln. Euro a day, furthermore by June its share went down to 5,4% (according to Strategy Analytics). Apparently, only a miracle or an incredibly successful and awesome line-up could save the company’s day. Over at Siemens they decided to reject the latter idea, as they were regarding things in a sober light – by that moment the amount of developers had been reduced to the utmost (over two years a part company’s staff had been laid off in order to cut down expenses). The remaining team could not support the already existing handsets and develop software for new ones – that was too much for them. As a result ordinary consumers saw awfully written software, crudeness of handsets and recession of Siemens-branded devices’ reputation that has started in 2003, to the point when they are considered as unstable, buggy handsets. Regrettably, Siemens was not in habit of correcting own mistakes – instead the company’s managers kept spreading high-flown words. Giving an interview to me, one the company’s directors was very proud to report on the success Xelibri line-up had, even though by then it was not a secret that this range had turned out to be a deafening failure, while all developments in this field had already been shut down. The same can be said about the company’s attempts to somewhat stabilize the disorder in its business – the real deeds got replaced with grandiloquent words.
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