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

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.

[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.

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!

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.

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.