Motorola To Split In Two

Hugh Pickens writes "The NY Times reports that Motorola plans to reorganize itself into two independent publicly held companies by the first quarter of 2011. The first company will own the Motorola brand and will include Motorola's mobile handset unit and home set-top box business. This new company will focus on the 'three screens' lifestyle envisioned by carriers like AT&T and Verizon, where customers would watch content on TV, on their computers, and on their mobile phones. The other company emerging from the split will include Motorola's wireless networking business and its enterprise radio systems operations. The wireless networking business would likely be sold off, leaving the second company with its profitable enterprise radio systems business, which generated $7 billion of the company's $22 billion in sales in 2009."

Comments

Ehh... And there were times

[RCL]

When Motorola was a processor brand. And a good one. Ehh...

Re:Ehh... And there were times

[noidentity]

Indeed, though they spun off their semiconductor division into Freescale a while back.

The end of a giant.

[kurt555gs]

Motorola forgot that the reason people bought their products was because they were the best in the world. Not the cheapest. The best. When Galvin Sr. ran the company, Motorola radios were the finest on Earth. Motorola brought us the 1st transistor TV, Quasar, the G4 chip was great. Iridium was a great idea, ruined by Galvin Jr. When Motorola was run by engineers, it thrived, even though it's products were usually the most expensive in the industry. Once the accountants and stock swindlers got hold of it, there was a race to the bottom, and this is the end result. The MBA's just can not conceive that people will pay for quality and innovation. Being cheapest, cutting R&D, Ugh, I could go on, but I think you know what I mean.

So long Motorola! It was a good run.

Re:The end of a giant.

[samkass]

I'm not sure why you say this split in particular is the end-- Motorola has done this sort of thing a couple times already. In fact I work for a division of General Dynamics that was once Motorola. There's also Freescale, which used to be Motorola's microprocessor unit. They seem to like being a certain size and when they grow beyond it they divide.

Re:The end of a giant.

[DrDitto]

Iridium was a terrible idea devised by engineers with an ill-thought out business plan. The business model could *never* succeed by simple math (i.e., the max capacity of the Iridium system was so small that it could really never be profitable). The worst part of Iridium was that it was an engineering drain on the rest of the company. Some of our best cellphone engineers got sucked into making cellular plug-in cards for Iridium handsets.

BTW-- I used to work for Motorola as a software engineer on handsets. It was a lousy experience.

Re:The end of a giant.

[kurt555gs]

Oh, I forgot, the 68000. The best computer chip of the era!

Re:The end of a giant.

[kent_eh]

They seem to like being a certain size and when they grow beyond it they divide.

That may be incredibly wise of them.
I've worked for a couple of companies who started off very innovative and did a lot of smart things until they grew above a certain size. Then they became bloated, bureaucratic and stopped innovating. And the bigger they got the more concerned with internal processes they became, yet the less profitable they became.
I've lived inside that twice, and I've seen it happen to countless other companies.

Re:The end of a giant.

[Hurricane78]

There’s an obvious reason for that: Humans are not made to live in huge hierarchies. We are made to live in small groups of people, where everybody knows everybody. (Example)

As soon as things become half-anonymous, or people do not actually participate in any decisions anymore, it stops working. The one on top will then only care for themselves, as they are the only ones that seem “real”. The one on the bottom will “just do his job”, not really caring for the company anymore.

It’s the same reason why states can’t work. We’re not a team anymore. We are way to diverse to be that tight unity of a community where everybody cares for everybody, or even has mostly the same views as everybody else.

It is possible with fractal structures though.
Meaning you have small groups of 20-50 people, who also act as a atomic entity in a group of 20-50 groups. And so on.
It’s very important here, that they can really act like single entities in that big group. Else it’s not possible.

Re:The end of a giant.

[timholman]

The MBA's just can not conceive that people will pay for quality and innovation.

What really destroyed Motorola, IMO, was Six Sigma. Motorola was one of the the first U.S. companies to get sucked into that MBA fad, and it ruined them.

Six Sigma, if left unchecked, quickly becomes the all-consuming passion of every mid-level manager. All of management's efforts go into the bean-counting involved in keeping track of how corporate processes are constantly "improving". You stop watching the competition, and what's happening outside the company, and turn inward instead. Motorola was blindsided by the introduction of digital cellular technology while focused on Six Sigma, and never recovered.

You can begin to track Motorola's decline from the year they won the Malcolm Baldrige Award (1988). Go look at the Wikepedia entry on the Baldrige Award, and you'll see that the list of winners is practically a "Who's Who" of failed and underperforming U.S. companies.

Woohoo!

[Colin Smith]

Thanks Motorola, AT&T and Verizon. I can now watch TV on three... THREE whole screens. What a lifestyle those guys will allow me.

ok. let me put it this way. TV is shit. It is soul sucking garbage of the shallowest most inane kind.

If this is all the "executives" can come up with, the company is better off dead. Kill it. Kill it before the USA becomes known as the Zombie Nation.

 

More like split into 4

[DeathOverlord3]

I think you mean Motorola is further splitting themselves up after having spun off its semiconductor components division as On Semi in 1999 and its semiconductor products division as Freescale (arguably the 'real' Motorola - inventor of the 68000 uP) in 2004. Motorola at this point is just an uninspired electronics company with little to no relevance in consumer handheld devices that also makes crummy radios and network products.

Re:More like split into 4

[ishobo]

The real Motorola is the radio business (car radios, walkie-talkies, base stations, repeaters, etc). The company's first product was a car radio (hence the name Motorola) and they invented the walkie-talkie under a contract with the U.S. War Department. They only got into the semiconductor business to supply their own needs, and did not start producing products for others until 40 years after its founding.

Stupid

[RobNich]

I think this is an incredibly stupid decision. Motorola has sold off pieces of their business for cash over the years (spun off their IC division yet continued to buy ICs), while they also acquired other companies for various reasons.

Internally, the company's processes are woefully out of date, considering the ability of competitors like Nokia and Samsung to get products out the door. Splitting the company is not going to solve that.

As a consumer, Motorola has burned me too many times. Their philosophy seems to revolve around putting out as many products as possible, instead of supporting and increasing functionality in their existing product line. When you bought a Motorola handset in the past, you essentially bought a car--closed to the world, no software upgrades, and if you want a slight improvement, you must buy a new one. Contrast that with Apple, who continue to provide updates to their original hardware for years. Look at the resale value of Apple devices in all categories!

Phones are hardware, but the software is key. Motorola took years to realize that, and there are still plenty of people working for the company that have the wrong attitude in this regard. People like flashy hardware, but if the software is buggy and lacking functionality, they will turn to a new source.

Apple has very few products in their handset line, and they sell plenty of them. They also sell wireless networking equipment, and set-top boxes (Apple TV). They currently build, or at least commission, their own ICs (A4 processor). Apple is going stronger than ever. It seems that Motorola's executive leadership are about 5 years behind the times, not on top of the market like they should be. If they weren't so far behind, they would have seen the need for a decent software platform in 2002, and they would see Apple as an example that a multifaceted company can do well in business.

Instead, they milked the RAZR for years, and invested the money it earned in the other businesses, such as the acquisition of Symbol. Then once the mobile device devision was languishing, they wanted to split it away from the "profitable" business!

Re:Stupid

[SMOKEING]

> Phones are hardware, but the software is key. ... but if the software is buggy and lacking functionality,
> they will turn to a new source.

There is a big community around Motorola mobiles (modmymoto.com, motorolafans.com, motofan.ru). For each of their architectures (P2K, MOTOMAGX, EZX), there is a good deal of mods, flashes, skins, language packs, all things software existing in all possible colours and varieties, eventually bumping into the hardware limits. And all of it works.

I bought my L7 back in 2006 in The Netherlands, and it had (reasonably) no Cyrillic support. After a week of texting in translit, I had reflashed it, and have been happily texting ever since -- all it had taken me was, google the matter. Do I owe this improvement to Motorola? Yes, but only for making it possible and not being in the way.

You see the care and attention you seek in Apple's being ever at war with modders, where every next system update wrecks the phone that's been previously jailbroken: I see in this a monumental waste of resources. If Motorola refrains from enfocing their control over the devices they sold to you, this is by no means negligence, and least of all, evil.

Which one keeps the "Motorola" name?

[tomhudson]

... because I *really* like Motorola cell phones. They've always been tanks. My current one is 4 years old, almost 5,000 hours, and has been dropped (and smashed by one angry perp I caught on video who tried to "destroy the evidence") onto concrete.

The weak point was the plug at the bottom for the charger - it stopped working properly a few weeks ago. 10 minutes with the point of a kitchen knife to scrape off the accumulated gunk and it's good as new!

Re:Which one keeps the "Motorola" name?

[gnalle]

I once had a Motorola razor phone, and the user interface was horrible. The menu tree was too deep, and it was often difficult to guess which submenu contained which menu item.

I am for one not surprised that the company ended up in trouble.

The split was Carl Icahn's idea.

[Futurepower(R)]

Neither of the stories linked by Slashdot mentioned the underlying reasons for the split. The split was Carl Icahn's idea. One story: Carl Icahn Top Stocks: Yahoo! Inc., Motorola Inc., ...

Quote: "On March 24, 2008 Icahn sued Motorola as part of his efforts to gain 4 seats on Motorola's Board and force a sale of its mobile business."

It is interesting that the New York Times article linked by Slashdot doesn't discuss the reason for the split. The reason may be that the split would be profitable for Mr. Icahn.

Symbol to be egested

[El Royo]

This isn't really too surprising. When they purchased Symbol Technologies they were making a play for the wireless networking IP. I really didn't think they were very interested in holding on to the bar code scanning end of that business. Symbol is a big player in my industry so I'm very interested to see how those technologies get split up. I suppose we'll be getting much better details soon (or maybe I could have RTFA).

What happened? V3 failures.

[Futurepower(R)]

"I used to work for Motorola as a software engineer on handsets. It was a lousy experience."

Could you explain further? What happened that cause Motorola's inability to make sensible decisions?

The Motorola V3 Razr phone was successful until owners discovered the screen was open to dust and moisture, the manual was terrible, and the help messages were unhelpful. I noticed that Motorola cell phones became much less popular after the Razr.

Yaesu

[Bruce Perens]

Motorola owns Yaesu. Actually, it owns "Vertex Standard" and Yaesu is a division of it, thus the newer Yaesu logo which is a stylized "VS". I guess this is going with the enterprise radio division.

Obviously hams have been nervous that Motorola would kill Yaesu since the purchase happened. I don't see any reason to be less nervous.

Motorola have already done this twice

[Dogtanian]

Indeed, though they spun off their semiconductor division into Freescale a while back.

Yes; that was what I thought when I first read this. From what I remember reading here, Motorola have effectively split at least once before- seeing this confirms it. The current "Motorola" is AFAIK the one that just happened to keep the name.

IIRC many Slashdotters don't consider the current "Motorola" to be the true original company anyway. When they split again, "Motorola" will still exist- as long as the trademark exists.