Motorola unveils recycled phone, touch-screen internet device

Motorola Inc., the money-losing mobile-phone maker, will release a handset made of recycled plastic water bottles and a touch-screen device that will compete with Apple Inc.'s iPhone.

Both phones will debut at the Consumer Electronics Show in Las Vegas this week and be available in the first quarter, Schaumburg-based Motorola said today in a statement.

Sales at Motorola, the second-largest phone maker in the U.S., have shrunk for the past seven quarters as customers defected to devices such as Apple's iPhone, which supplanted Motorola's Razr as the most popular U.S. handset in the third quarter. Co-Chief Executive Officer Sanjay Jha has introduced more expensive products with full keyboards and touch screens to win back subscribers and bolster profit.

T-Mobile USA, a unit of Deutsche Telekom AG, will sell the recycled phone, called the Moto Renew, Motorola said. The touch- screen Motosurf will run on so-called third-generation networks used by the iPhone and Research In Motion Ltd.'s BlackBerry Storm. The Motosurf will be available in several regions, including Latin America and Asia, Motorola said.

Worldwide mobile-phone sales will drop 13 percent this year, the first decline since 2001, as the global economy contracts, according to Citigroup Inc. Motorola has said it will freeze pension plans and reduce executive salaries, including a 25 percent pay cut for Jha and co-CEO Greg Brown.

Motorola will also release the Tundra, a phone designed to withstand drops, dust, rain and severe temperatures, on Jan. 13. The phone will cost $199.99 with a two-year contract from AT&T Inc. and a $50 mail-in rebate, Motorola said.

Motorola fell 19 cents, or 4.1 percent, to $4.48 yesterday in New York Stock Exchange composite trading. The stock dropped 72 percent last year.