How Would a Motorola Ban in the U.S. Affect its Smartphone Market?

After a meteoric rise in the smartphone market over the last two years, Motorola is now facing a ban in the U.S. The U.S. International Trade Commission (ITC) launched an investigation into Motorola’s parent company Lenovo, and determined that the smartphones manufactured by the Motorola Mobility unit infringed on patents held by Ericsson.

The patent issues faced by Lenovo could cause Motorola to take the fall, with U.S. sales restrictions on its entire range of products. Motorola has managed to resurface in the markets quite successfully over the last year, particularly with its range of flip phones, but a potential ban could significantly hurt the company—more so than the threatened TikTok ban is expected to affect owner ByteDance.

Image: Motorola celebrating the Pantone Color of the Year for 2025, Mocha Mousse

Motorola U.S. Ban Explained—A Roadblock Appears in Lenovo’s Smartphone Market Ambitions

Last year, Swedish telecommunication company Ericsson filed a complaint with the US trade tribunal claiming that there were patent issues with Lenovo’s use of 5G wireless technology. As the technology has been used in multiple product lines, Motorola’s Moto G, Edge, and Razr devices were all called into question and targeted by the ban.

Lenovo denied all claims that it was infringing on patented IP or using any unlicensed technology at the time, however, with the latest ruling, it is evident that the U.S. Tribunal disagrees with its defense.

Motorola’s U.S. sales restriction will not go into effect immediately as the ITC will provide a final ruling regarding the matter in April 2025. If the decision is formalized, Motorola’s leading smartphone lineups will have to exit the U.S. market. There is no clear data on whether Motorola will be able to broker a deal with Ericsson to get a license to use the technology. We aren’t sure if the smartphone maker will even be interested in making such a move.

If the Motorola ban—occurring as a result of the patent ruling—is upheld, then the smartphone market in the country will be severely impacted considering the company’s considerable presence in the region as a supplier.

Motorola’s U.S. Sales Restrictions Could Cause Significant Change in the Market

Counterpoint Research’s investigation into the smartphone market found Apple to be a leader in the smartphone segment by a large margin for Q3 2024, making up 53% of the market share of smartphone shipments in the U.S. Samsung fell next in line with 23% of the market share. Surprisingly, Lenovo came next in the list, with its Motorola phones making up a part of its 14% market share in U.S. smartphone shipments.

If Motorola makes an exit, customers who rely on the smartphone maker for reasonably priced handsets will be forced to look elsewhere. The company doesn’t produce the cheapest devices on the market and neither are they the most reliable smartphones to have around, but their presence in the market has not been won by chance. Either out of nostalgia or genuine preference for the design and aesthetics of its devices, Motorola has made an admirable comeback among consumers.

The company’s biggest impact has been in the foldable smartphone segment, giving customers in the U.S. a way to experience a flip phone without having to splurge on something from Samsung or Google. Foldable phones are in high demand and Apple hasn’t managed to enter the market yet, giving Motorola enough time to make its presence felt.

Motorola’s ban in the U.S. will significantly benefit competitors, allowing them to reassert themselves. Other smaller brands could step in to fill the gap, but there is always the risk of the top players gaining even more ground. Reducing competition to return some of the market share to already dominant players is never good for the overall health of the market.

Ideally, Motorola and Lenovo will be able to find an alternate resolution to the situation instead of the ban, but the companies have not spoken out on the matter yet.