DailyTech - Motorola Looking to Restructure Business Divisions

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IT Motorola Looking to Restructure Business Divisions
Michael Barkoviak - November 12, 2009 6:40 AM

6 comment(s) - last by Acanthus.. on Nov 15 at 4:56 AM

Motorola looks to renew focus on its mobile phone unit, and may do so by spinning off its set-top box division

In the latest sign the company continues to struggle against upcoming rivals in the mobile phone and enterprise markets, Motorola is expected to spin off its home-networks division.

It's possible that the Motorola division could sell for up to $4.5 billion, but it's unknown how many companies, if any, are interested in making a deal. The home-networks business sector remains one of the company's three largest divisions, and offers products ranging from set-top boxes to wireless networking products -- the division offers modest revenue, but is the company's No. 1 unit in overall sales.

If the company is successful in selling its business unit dedicated to networking equipment and set-top boxes, then the company will have to rely even more on its struggling mobile phone business unit.

Motorola may keep the home-networks division after all, but the company previously said it's likely the handset unit would be isolated away from the rest of the company's business.

MKM Partner analyst Tero Kuittinen said the news "is surprising," and "means Motorola's exposure to the handset business will grow dramatically."

Motorola hopes the Droid phone helps the company rebound as Apple, Research In Motion, Samsung, HTC, and other companies continue to release popular smartphones. Analysts have been wary about Motorola's presence in the smartphone market, with the company severely lagging behind competitors -- and as more users switch to Google Android and other platforms, Motorola has struggled in the mobile OS market as well.

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This facility does both.

By CZroe on 11/12/2009 7:21:27 AM , Rating: 2

This facility does both (San Diego). I wonder what will happen here.

RE: This facility does both.

By SilverMirage on 11/12/2009 7:40:55 AM , Rating: 2

I think Motorola has conquered a market they didn't intend to take over. It's not the kind of product you think of when you think Motorola. Motorola doesn't want to change it's image to a company which makes electronics in the "background". They are just another good American company that made products which work better than any other company could. And when they entered the market, they got customers.

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RE: This facility does both.

By CZroe on 11/12/2009 8:36:47 AM , Rating: 2

Huh? Motorola has always been heavily involved in telecommunications. Set top boxes and cable modems are an extension of that. They have many competitors in the sat set top box market but pretty much only Scientific Atlanta in the cable box market. There is still a lot to do as cable cos become telcos. They will want all new switched digital boxes and boxes with built-in VoIP and IPTV. They will want all new DOCSIS 3.0 modems. It makes sense to deal with a company that can provide all of it in one package deal.

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Say what?

By CityZen on 11/12/2009 12:54:06 PM , Rating: 2

This article doesn't make much sense to me. Examples:

quote:
Motorola looks to renew focus on its mobile phone unit

quote:
the company previously said it's likely the handset unit would be isolated away from the rest of the company's business

So, which one is it? Aren't those two statements contradicting? Or is it that previously they were planning to spin off the mobile unit and now they've changed opinion and are planning to sell another unit instead?

Another one:

quote:
the division offers modest revenue, but is the company's No. 1 unit in overall sales

I guess that you must be measuring sales in units and not in dollars for that to be true, but it sounds confusing nonetheless. Or maybe that unit has some sort of non-operational negative revenue that diminishes its revenue from sales ... who knows

And then:

quote:
as more users switch to Google Android and other platforms, Motorola has struggled in the mobile OS market as well

The move towards Google Android is just beginning and with Droid Motorola stands to be one of the winners in that area. Hasn't Droid become the epitome of Android smartphones now?

There hasn't been an interesting motorola phone for a while.

By Acanthus on 11/15/2009 4:56:50 AM , Rating: 2

There isn't a price point where i can't find a better alternative than what Motorola has in their product line.

I blame "six sigma" management (making products take too long to get to market) and lackluster phone OS's.

There are too many players in the handset business, somethings gotta give. I would hope that Motorola isn't it, but again I haven't seen a strong motorola offering since the Razr which I didn't like. (I will admit it was hit, though)