Dell Smartphone Is Back to the Drawing Board

Dell is taking its smartphone plans back to the drawing board, according to analyst Kaufman Brother analyst Shaw Wu. According to the research note, competition from HTC, Samsung, LG, Nokia, Motorola and especially Palm — with its soon-to-arrive Palm Pre smartphone — has created a market in which, carriers say, a Dell smartphone doesn’t yet stand out.

Rumors of a Dell smartphone have swirled, with hopes that the computer maker would make a surprise announcement at 3GSM or the Mobile World Congress.

According to a March 20 research note from Kaufman Brothers analyst Shaw Wu, however, Dell’s current smartphone plans have, for now, been snuffed out.

“We hear Dell built prototypes with both [Microsoft] Windows and [Google] Android operating systems, but the feedback was lack of differentiation versus current and upcoming products from HTC, Samsung, LG, Nokia, Motorola, etc.,” wrote Wu in the research note.

The Palm Pre, expected to be available by June 30, is surely also an impediment to Dell’s cause. There has been considerable interest in it and anticipation of its arrival—perhaps most loudly from a major Palm investor. Images can be seen here.

Failing to find interest from carriers, Wu reports, Dell is going back to the drawing board to design a cell phone with more differentiation.

“This will likely involve vertical integration of some sort including software and/or services,” wrote Wu. “For this reason, we believe Dell is contemplating making acquisitions to help in this effort.”

Beyond Wu’s confirmation of Microsoft and Google Android versions, little is known of the device, which Dell has never publicly confirmed it is working on.

Endpoint Technologies Associates analyst Roger Kay suggested the device likely will not have a touch-screen—which would put Dell too directly in competition with Apple, and might also be cost-prohibitive.

Dell recently turned it attention back to the PC market and managed to create a lot of buzz around its new ultra-thin Adamo laptop, the first product in a new “Adamo by Dell” brand. The question that some are asking is whether Adamo can translate into something beyond laptops and signal a new approach to product design that could also encompass the company’s desire to enter the smartphone market.

Other PCs makers, notably Acer, are also looking to grab a greater share of the smartphone market. At the same time, Nokia has confirmed that it will enter the PC market with its own line of laptops.

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