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Are the iPOD and other portable MP-3 players about to be overtaken by MP3 playing cell phones? Not today, according to a report by the industry analysts at market research firm In-Stat. Actually, they predict probably not ever, citing usability and execution as two of the primary reasons. They based this, in part on a similar study of why camera phones have yet to give digital cameras more of a run for your money. Is this really a valid comparison? 

Obviously the two products aren’t directly comparable. Who here thinks your camera phone will be able to rival the image quality of the Canon Digital Rebel you’re clickin’ off shots of your drunk cousin Ned at the company Christmas (excuse me, Holiday)party. A camera phone will always be a second rate substitute for a true digital camera, if for no other reason than a real digital camera will sport much better optics. The laws of physics, you know.

In much the same way, you’ll always be able to have room for more storage and better sound quality with a stand alone MP3 player, but here the two products could get much closer. Ultimate sound quality isn’t the most important thing with these players anyway. As long as it’s good enough when you jack it into the stereo in your new Jetta, there’ll probably be no complaints. Here, effective marketing could make things much closer. As compression algorithms and memory improves, you’ll be able to stuff most of your music collection on your phone.

According to Telephia Customer Value Metrics, at the end of 2005, 18-25 year old males, the leading cell phone user group, placed an average of 340 calls, and spent 1,304 minute per month with that Moto stuck to their head. This group of consumers is overly concerned with status, one of the reasons the iPOD has done so well. Not only did it break barriers on the ergonomic and industrial design front, it was deemed the thing to have. The right MP3 cell phone, backed by a great marketing campaign, could make things much closer. After all most people have cell phones with them almost 24/7 anyway.

Last month Motorola introduced Bluetooth music streaming, so you can stream music from your phone directly to your Bluetooth compatible car stereo. That kind of innovation, and phones such as the supremely popular Moto Razr (Motorola has sold over 51 million Motorazrs worldwide), has contributed to a revival at Motorola. Can they take on Apple, a company founded on innovation? Time will tell, but you can bet someone over there is contemplating the prospect. A better question may be, will they have to?

A few weeks ago, Motorola announced an agreement to acquire Good Technology, a producer of enterprise grade mobile computing applications, aimed at mobile data, messaging and wireless security. The acquisition will help them position the phone/MP3 player/PDA/heart monitor/microwave oven/PC/video player to further take over your life. Yesterday, Motorola, was voted as the second most influential Fortune 500 company in China by Chinese business publication Southern Weekend. Motorola employs over 10,000 people in China. If they can make the emerging Chinese market believe in the combined power of the MP3 player and cell phone, it may not matter what we think in the U.S.