Motorola unveils low-end phones for music and Web : US Business

SINGAPORE (Reuters) - Motorola Inc , the world's third-largest handset maker, unveiled two new low-end phones on Wednesday that allow users to listen to songs and surf the Web.

Motorola, which has failed to come up with a strong follow-up to its once-lauded Razr phone, has lost out to market leader Nokia and other rivals since early last year.

The firm, which faces stiff competition from handsets such as Apple Inc's popular touch-screen iPhone, has said it would launch 50 new devices this year, including advanced phones.

One new handset is a music-enabled camera phone -- the W388 -- that sells for under $100.

The second device is a low-end third-generation (3G) mobile phone -- the VE538 -- which goes for less than $250 and offers one-click mobile social networking, photo uploading and blogging at various websites.

The two new products will be shipped to Asia-Pacific markets first -- before being rolled out globally -- by September.

"People don't buy products any more, they buy what those products can create for them -- solutions, dreams, whatever they are looking for in life," said Ian Chapman-Banks, the General Manager for Motorola's Mobile Devices business in Asia. In July, Motorola posted a small quarterly profit after more than a year of disappointing results, as it sold more mobile phones than expected, thanks to strength in North America.

The firm, which narrowly kept its No. 3 ranking in the global phone market ahead of South Korea's LG Electronics Inc <066570.KS>, also forecast a full-year profit that beat Wall Street estimates as it plans new products and further cost cutting.

It plans to separate its mobile phone unit from the rest of the company in the third quarter of 2009.

(Reporting by Jennifer Tan; Editing by Kim Coghill)

(c) Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.