Yes Dell Can… Make a difference in the mobile phone business.

I just saw this article on Engadget Mobile about carrier’s reactions to Dell’s mobile phone prototypes. Apparently the carriers felt Dell’s phones lacked “differentiation.”

Dell became great during a time when differentiation didn’t matter. In fact, their business model is built on a lack of differentiation between devices. Their strength is their ability to offer cheaper prices because of scale. Cheaper prices haven’t been all that important in the mobile phone business. If people like a phone, they pay for it. Dell likely went to the carriers trying to get an exclusivity deal and “differentiation” absolutely matters there. Danger could have offered Dell some opportunity for differentiation by extending the range of their platform, but Microsoft snapped them up.

Given the economy, there may be some hope for them if they can get something out fast. A low-priced smartphone targeting parents and their tweens/teens could have some legs if it offered great parent-centric features without seeming too restrictive to the kids. Similarly, though RIM and Apple own the hearts of the most savvy cell phone users, most cell phones are a few years old and are dumb. In keeping with their business model, there’s a great opportunity for Dell to reach those users who need to upgrade because they want new features but don’t need the whiz-bang technologies of a Blackberry or the iPhone. That also happens to be a place where differentiation isn’t all that important as long as the target audience knows what the primary benefit is.

Dell has the heft to make a strong entry into the cell phone business. I’m they’re keeping their eye on the right bulls eye.