The struggling mobile phone developer Motorola (MOT) is all set to establish itself as a formidable player in the intensely competitive smart-phone market. The company entered into an agreement with Blockbuster Inc. (BBI) to offer mobile video entertainment to its customers. Motorola will introduce two 3G high-end smart-phone models based on Google’s (GOOG) Android software in the fourth quarter of 2009.
 
Blockbuster is a movie and video game retailer. As a result of this agreement, Motorola mobile phone users will enjoy the benefit of Blockbuster’s On Demand service and library of digital video titles. Users will be able to watch any movie/video games or can download the same on his/her handset that are available in the Blockbuster video library. Partnership with Blockbuster will give Motorola a competitive foothold compared to Apple Inc.’s (AAPL) legendary iPhone that offers movie download facilities through Apple’s own iTunes movie store.
 
According to various industry researches, although the basic mobile phone industry is facing a downturn, the feature rich high-end smart-phones are seeing strong consumer preference. The total number of mobile video subscriber is likely to cross 400 million by the end of 2013. The total number of mobile video handset to be sold by that time may also cross 400 million. This will create a market opportunity of more than $10 billion for smart phone developers.
 
Motorola announced that its two new 3G handsets will feature an intuitive user interface and an efficient combination of Internet access, messaging, and multi-media applications based on the Android software ecosystem. Currently, more than 6,000 multimedia and social networking applications are available based on the Android ecosystem. Motorola is trying hard to expand this platform using its proprietary MOTODEV program. Management also declared that another 30 3G high-end mobile handset models are in the offing during fiscal 2010.
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