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Struggling phonemaker is in for some painful changes

Google Inc. (GOOG) announced the first step in its plans to overhaul struggling recent acquisition Motorola Mobility on Monday.  As part of the overhaul it will cut 1 out of every 5 jobs at the phonemaker unit, and will close roughly 31 of the 94 offices worldwide.

I. From the First Cell Phone to Near Last

In the wireless industry there is perhaps no company with as long and rich a history as Motorola.

Founded in 1928, Motorola was a pioneer in the world of wireless communications, inventing the world's first wireless walkie talkie in 1940 and the first commercial cell phone in 1973.  It would go on to play a crucial role as an early maker of mobile devices and infrastructure.

But Motorola's problems have stretched for around a decade and a half as the golden glory of its heyday faded.

Motorola first cell
Motorola literally invented the cell phone, but almost exited the market amid failing sales.
[Image Source: Know Your Cell]

Since the late 1990s Motorola has languished, first being overtaken by Finland's Nokia Oyj. (HEX:NOK1V) and Research in Motion, Ltd. (TSE:RIM) in various markets, then later by young guns like Apple, Inc. (AAPL) and even a revitalized Samsung Electronics Comp., Ltd. (KSC:005930).  A minor hit in 2004 -- the RAZR -- quickly became another disappointment after Motorola failed to continue to push the design and feature envelope, preferring self-referential sequels.  

A friend of mine in the software industry close to the phonemaker recently told me a story of how a former Motorola executive was sent to check out a promising startup as a potential acquisition in 2009.  He returned to report that the company was of no real interest.  

Weeks later he had quit Motorola and joined the startup.  The name?  FourSquare.

Motorola had for decades attracted innovators, but sadly stories like that defection were commonplace for the phonemaker as it stumbled through a decade of disappointing earnings which eventually culminated in hard red losses.

Of all the wrong moves Motorola made, the company did make one wise bid, becoming an early adopter of the Android operating system, a move that temporarily halted its losses in the smartphone market and gave it a small breath of life.

II. Google's Restoration Begins With Fresh Blood at the Top

Now it's up to Google, makers of Android, to finish sorting out the mess.  The software giant bought a $12.5B USD "fix-me-up" in Motorola, and now it's tearing down the mildewed walls and uprooting the rotting floorboards.  And it's not afraid to start cutting close to home.

Globally Motorola employs around 20,000 folks -- about as much as RIM did at its peak in 2008.  Of those, 4,000 will now be cut.  That leaves Motorola with a workforce that will still be more than 50 percent bigger than struggling peer RIM.  The cuts will be painful, though, with around 1,300 -- roughly a third -- coming from the phonemaker's home country, the U.S.

Fixer upper
Motorola Mobility is a big fixer-upper for Google. [Image Source: HWTN.org]

Dennis Woodside, new CEO of Motorola tells The New York Times in an interview that the key to the phonemaker's revival will start with pulling out of markets where Motorola is actually losing money.  He comments, "We’re excited about the smartphone business.  The Google business is built on a wired model, and as the world moves to a pretty much completely wireless model over time, it’s really going to be important for Google to understand everything about the mobile consumer."

Google has also recruited Mark Randall, a star up-and-comer from Amazon.com, Inc. (AMZN) (and also a Nokia veteran), who is acting as Motorola's new supply chief.  He says that when he came onboard Motorola's parts chain was a mess, but that by using fewer suppliers and 50 percent less parts he will be able to substantially cut costs.

Other key additions include former DARPA chief Regina Dugan, who will lead Motorola's advanced technology group, and Vanessa Wittman -- former CFO of brokerage firm Marsh & McLennan Comp.s, Inc. (MMC) -- who now steps in as Motorola's CFO.

III. Motorola Has Some Advantages, Even Without Special Android Favors

As every analyst or foe states at every possible opportunity it should be interesting to see whether Google shows any signs of favoritism towards Motorola, over its third party Android partners.  So far Google's approach seems to mirror Microsoft's handling of partner Nokia -- to trade employees, but steadfastly avoid any sort of exclusive product or software offerings.

Motorola has some advantages going ahead.  Apple's case against it has been dismissed in the U.S., making it the first of the Android Big Three to be out of that legal nightmare.    In the features department, Motorola's phones like the RAZR MAXX hold the battery life crown, even beating Apple's perennial battery life performer, the iPhone [Source: AnandTech].

Droid RAZR MAXX
The RAZR Maxx remains king of battery life. [Image Source: Verizon Wireless]

But Motorola must not waiver from releasing high-profile flagship phones or it risks losing the publicity battle with polished market leaders Samsung and Apple -- both kings of public relations hype.

The fresh blood must deliver oxygen to Motorola's atrophying muscles.  That much is apparent after the latest quarter of losses followed by a new regiment of layoffs and cost cutting.


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RE: I look forward to the day...
By JasonMick (blog) on 8/13/2012 1:40:05 PM , Rating: 3
quote:
That day will begin November 2012.
You're drinking the kool aid if you think either candidate will grow jobs.

The bottom line is that both candidates will continue to appease special interests with the help of Congress.

There may be some shift in terms of who the corporate winners are, depending on who's elected, but at the end of the day neither candidate is willing to enact simple no-nonsense provisions, like cutting grants to companies that outsource jobs, charging a no-exception flat tax on U.S. sales, charging a flat tax on all forms of personal income, and opening cutting billions in payouts to nations like Pakistan in exchange for some ambiguous notion of security.

I can not wait until either Obama or Romney is elected, because I guarantee you it will be the same old story of big promises and failing results. The economy will continue to struggle with many of the same fundamental issues because neither side wishes to fix them.

This will likely continue as long as America's two party system persists, and with it pandering to voters while playing lapdog to special interests (corporations, overseas wealth, and the perverted modern manifestation of the trade union). The choice is simply an illusion, like picking which locust in your wheat field is less destructive, when in reality they're both more or less the same, and both destroying the field.

Both parties work in unison to suck away the nation's prosperity and consolidate it amongst a small plutocracy. In exchange they get power. The special interests give the candidates the PAC funding they need to elevate their name to an otherwise ignorant and apathetic public, in effect buying the vote.

Money doesn't buy votes in America.

But money buys coverage, allowing the best panderer to win out in the end.

Money buys image, image defeats apathy, and hence the American people vote in candidates with little interest in preserving a fair, free market, national education, and the prosperity of the majority.


RE: I look forward to the day...
By Reclaimer77 on 8/13/2012 2:08:49 PM , Rating: 1
Jason don't preach to me. You can keep banging that drum all you want, but those things are NOT what has put us in this hole. They're important to you, but how about we start with little steps like, oh I don't know, actually having a budget at the Federal level?

quote:
You're drinking the kool aid if you think either candidate will grow jobs.


Well we already know one CAN'T! I say give the other guy a shot. It's not like it's possible to do any worst.

I know what you're doing and I don't like it. It's what your other mainstream media pals have been doing on the news. Convince America that both suck, so Obama can win again. Use apathy and cynicism to defeat the hearts and minds of Americans before the election even starts. Well you can sell it somewhere else, I'm not buying it.

quote:
You're drinking the kool aid if you think either candidate will grow jobs.


I'm going to make you choke on these words. Under Romney the economy will turn around, and jobs will be created. If for no other reason than a massive decrease in Federal spending levels from Obama's simply unsustainable rates.

By the way I'm not some goddamn kid, I don't drink Kool Aid anymore.


RE: I look forward to the day...
By retrospooty on 8/13/2012 2:40:20 PM , Rating: 2
You have to admit, truer words have never been spoken.

" The bottom line is that both candidates will continue to appease special interests with the help of Congress."

I am voting for Romney, simply because Obama has proven he can't do anything right regarding the economy and cant stop the federal govt's addiction to spending other peoples money, and makes zero effort to even try... With that said, I dont have high hopes. Both parties have sold us out, and to act like they havent doesnt help fix it.


RE: I look forward to the day...
By Belard on 8/15/2012 7:40:06 AM , Rating: 1
And I will ask you an honest question...

Have you seen the republicans actually try? Remember, the GOP was fighting to keep TWO different engines for the F35 when the Pentagon and DEMS only wanted to buy one... saves money.

So you said Obama hasn't done anything, why do the neo-con talk shows scream about how Obama is doing to much? Which is it? Ever thought perhaps you may want to refer to actual numbers and information to reach a conclusion?

I cannot just POST XYZ and say there. YOU need to do this yourself.

Example: Person A says : This B guy did nothing, he spent money and picked his nose. Thats my store and I'm sticking with it.

Person C says: GAO and other valid sources (non partisan) state that XYZ$ amount of money was spent in 2006, 2007, 2008, 2009, 2010. The graph here shows XZ levels based on information from the IRS and other sources.

There is a difference is saying a lie to make your point using facts.

An example is when some neo-con screams about the 22 job bills the Republicans have tried to pushed through the house. I looked up the actual HR Bills. You can see WHO proposed the bill, the title, dates, what it actually does. its status, etc. Its all available FROM our government.

Those 22 job bills... not jobs bills. Mostly removes pollution laws for oil companies.

Some examples:

HR872 = Reducing Regulatory Burdens Act of 2011 (de-regulating poisons)
HR910 = Energy Tax Prevention Act of 2011
HR 1230 = Restarting American Offshore Leasing Now Act (We are drilling more than ever in the USA)

How about this one: HR 2021 = Jobs and Energy Permitting Act of 2011 Wow, that is a jobs bill, it had to pass! Wait, what does it do? HR2021 really does this: EPA shall have no authority to consider any matter regarding the consideration, issuance, or denial of such permit. ie: The EPA has little or no power to deny permits to oil companies that pollute air.

It doesn't create a job. It saves Koch, Haliburton, BP and other companies money for their screw ups. I don't recall the oil companies struggling to make a profit. And they are doing so good with profits, we *WE* give them handouts?

www.govtrack.us/congress/bills/112/hr2021 you can read it yourself.

Its passed the house, but it would be killed in the Senate, so it sits... waiting for GOP control to come in and make this law.

By all means, explain how drinking oil is good for you? Its not, oil is toxic. I so some work in the oil industry. Actually, we even drink a bit of oil depending on what you eat. FD&C Red Dye #40 is made from petroleum or coal tar. WTF?!

This is in most food that is RED. This include cherries, candy, soda pop... look at the ingredients. Aren't you glad we have a social system that requires us to LIST some of these things that are in our food. (Not all) Did you know that when you buy most red apples, they are actually green or kind of red, so they spray apples with Red #40 to they look so yummy.

Look up Pink Slime. Even my stupid gov. Rich retard Perry went to a processing plant for that crap. Its the parts of the cow people don't want. yeah, I understand about hot-dogs. But when you get ground beef you WANT 100% ground beef right?

Here is how you can spot Pink Slime burger meat. Next time you go to Walmart, Sams, Safeway. On the package which has change recently, now says things like "100% Natural Pure Ground Beef*" See the "*" It'll say "minimally processed" Well, that sounds innocent. That part of the technically word for Pink Slime. Up to 25% of that "beef" is not meat. Its been poisoned and color-dyed, compressed, then shipped then mixed with real beef. Some Grocery stores sell 100% beef.

I pay a bit more for the meat. How much? About 25 cents a pound! And you know what, it tastes better, cooks better.

But by all means, its a free country - eat as much pink slime as your want. For my family, I'd like for them to not eat shit.

What the point of this? There is a lot of behind the scenes crap going on for people like THEM to make money off the tears, blood and sweat off the people like YOU.

You have a choice.

PS: yes, both parties are sell outs... I'll go with the least dangerous one, the one that is not out to give billionaires taxes breaks (we did very well in the 90s mind you) and attack women rights - because sticking government in women vagina's creates jobs.

This country DOES not belong to YOU, the GOP, Koch, Grover Norquist, Limbaugh and especially foreigners like Murdoch and Alwaleed bin Talal. It belongs to *ALL bloody Americans* and our stupid govt. has to make laws FOR the PEOPLE, not corporations. They represent us. In the past - compromise means working together, both sides get something what we want. Not JUST you, but not me.


RE: I look forward to the day...
By JasonMick (blog) on 8/13/2012 2:53:38 PM , Rating: 2
quote:
It's what your other mainstream media pals have been doing on the news
What? They tend to fixate to one side and admonish the other.

What channel are you watching?

Mainstream media has done everything it can to SILENCE true alternative voices like Ron Paul.
quote:
They're important to you, but how about we start with little steps like, oh I don't know, actually having a budget at the Federal level?
If by "have a budget" you mean BALANCE the budget, only one candidate did that in recent history -- Bill Clinton. A Democrat.

http://4.bp.blogspot.com/-71c7GYQTdr8/ThKrIqGKZGI/...
http://www.thegatewaypundit.com/wp-content/uploads...

Not that Clinton was great in general policy, but give him a bit of credit for that. And give everyone else (Obama included) a big stick for their reckless spending.

Obama clearly isn't balancing the budget. But take away his one huge line item -- the bank bailout -- which was approved by most Republicans, and initialized by GWB, and he's your average Bush/Reagan/Carteresque deficit spender.

Maybe Romney will buck the trend and become the first Republican President in recent history not to deficit spend, but I find that highly unlikely.
quote:
Convince America that both suck, so Obama can win again. Use apathy and cynicism to defeat the hearts and minds of Americans before the election even starts. Well you can sell it somewhere else, I'm not buying it.
What's worse, acknowledging that both suck to some extent, or denying reality because you fear it?
quote:
I'm going to make you choke on these words. Under Romney the economy will turn around, and jobs will be created.
We shall see.

I think IF Romney is elected, he will certainly try to spin it as if jobs are being created and the economy is improving. Remember Barack Obama "saved us from depression, created jobs, and sent the economy on a path to recovery"* .... never mind more jobs were lost than gained, we're still mired in recession, and the recovery is stalled, more or less.

I'd imagine under Romney you would see similar self-engrandizement, yet when you actually look @ the figures (as with Obama) they'll be very weak.

The problem is policy. Romney's platform fails to fix most of the fundamental problems of America's federal government.

We shall see, if Romney wins and somehow manages to balance the budget, I will offer him due credit in my coverage. But I find that likelihood extremely slim (though the addition of Ryan does breed some small hope, I guess).


RE: I look forward to the day...
By Reclaimer77 on 8/13/2012 3:12:46 PM , Rating: 2
quote:
I'd imagine under Romney you would see similar self-engrandizement, yet when you actually look @ the figures (as with Obama) they'll be very weak.


No because the media would never do this. Even if Romney had the best economy on the planet, the media would tirelessly work 24/7 to portray it as the worst economy on record.

Just like they tirelessly work now to cover up the fact that Obama has truly bankrupted the nation and set us up for a very real financial crisis. And the jobs situation looks like something from the Depression.

quote:
Mainstream media has done everything it can to SILENCE true alternative voices like Ron Paul.


Well of course! Ron Paul is like the anti-Liberal. He's Kryptonite for Collectivists.

I mean look at the polling data! How is it even possible that so many American's supposedly believe Obama is doing a "good job"? It shouldn't even be possible! We're witnessing mass-media brainwashing on an epic scale here. The number of truly misinformed Americans is astounding.

quote:
The problem is policy. Romney's platform fails to fix most of the fundamental problems of America's federal government.


How can you put that on Romney? How is that fair? Even if he tried to fix the federal Government, the goddamn Democrats would fight him tooth and nail! We're spending nearly a trillion on entitlements and programs. You know full well Democrats would rather DIE than see that get reduced. Even Ron Paul wouldn't be able to fix the Government at this point.

Our biggest immediate problem is the budget. If that doesn't get chainsawed down, the other problems won't matter because we'll be doomed.


RE: I look forward to the day...
By JasonMick (blog) on 8/13/2012 3:31:02 PM , Rating: 2
quote:
How can you put that on Romney? How is that fair? Even if he tried to fix the federal Government, the goddamn Democrats would fight him tooth and nail! We're spending nearly a trillion on entitlements and programs. You know full well Democrats would rather DIE than see that get reduced. Even Ron Paul wouldn't be able to fix the Government at this point.
Again, you're buying the rhetoric. Both sides are supporting big gov't. George W. Bush signed the $700B USD bank bailout. Obama pushed through its successor, a smaller (but still record) $475B bailout. Remove those two factors and both sides have been equally naughty when it comes to out-of-control spending:
http://factcheck.org/2012/06/obamas-spending-infer...

Romney's claims that he's going to balance the budget and cut taxes, are impossible, according to independent analysts:
http://factcheck.org/2012/08/romneys-impossible-ta...

The take home msg.?

Whoever wins, we'll be stuck with more deficits unless something shocking occurs.

Perhaps you're right -- Obama had his shot, now Romney deserves his.

But forgive me if I don't go peeing myself with excitement that he's going to pull a Jesus and turn the tepid water of the federal budget into fiscally responsible wine. Extremely unlikely to happen, even if he wins.


RE: I look forward to the day...
By Reclaimer77 on 8/13/2012 3:42:56 PM , Rating: 2
Jason, George Bush was not your average Republican. He does NOT define our parties beliefs. And you know this.

Everyone says moderates are so great, and we should vote them in. Well guess what? Bush was a moderate. Fact, deal with it. How well did that work out for us?

quote:
Romney's claims that he's going to balance the budget and cut taxes, are impossible, according to independent analysts:


That's purely irrelevant at this point. The only thing that matters is that Obama LOSES!

We don't know what Romney will do. We don't know what will happen. But we KNOW this: That based on Obama's record and his record alone, he should not be reelected.


By retrospooty on 8/13/2012 3:52:45 PM , Rating: 2
"We don't know what Romney will do. We don't know what will happen. But we KNOW this: That based on Obama's record and his record alone, he should not be reelected."

I almost hate to agree with you on Politics, becasue you are so... several LOL. But I do agree with you on this.

Everything we have seen with Obama in hist 1st term is what he has done while still trying to secure a 2nd term. I am scared as hell to think of what he might do in a 2nd term with no "next election" hanging over his head. It would be an Obama, no holds barred spending spree.


RE: I look forward to the day...
By Shadowself on 8/13/2012 3:06:24 PM , Rating: 3
While I rarely agree with Jason, in one sense he's right. Neither candidate is going to grow jobs as long as the system does not change.

No matter what you want to say, Reclaimer, the reality is that the persons aligned with the Republican party have, for the last 3+ years had as their sole agenda keeping anything from happening that might have the possibility of making Obama or the democrats look good. It does not matter that the economy, immigration, taxes, etc., etc., etc. do not get better. Just don't let those democrats have one tiny chance at looking good.

And the Democrats have been no better! If Romney gets elected, you can be 100% guaranteed that the Democrats will do their damnedest to do the exact same thing -- Do that will make the Republicans look bad.

There really is no bipartisan capability in Washington anymore. Take for example the case of the two Utah Senators just a couple years ago. Utah is one of the most conservative states out there. Their two Senators fit that mold. But they had the supreme audacity to be willing to work with non Republicans! The ultra conservatives across the country got enough clout to oust one a couple years ago and the other has struggled this past year to stay in the game.

The current sentiment (and it's been growing for about 20 years) is, "Hurt the other party no matter what. The country and the public be damned!"

Could Obama have signed into law changes if Congress had passed bills truly for the general good and one one party's or the other? Absolutely. Could Romney do it if Congress actually got their act together? Absolutely.

However, to believe that Romney has a magic wand to do this while Obama didn't is truly naive.

Oh, and I"m probably old enough to be your parent if not your grand parent, and I still drink Kool-Aid occasionally. Hell, I'm almost old enough to remember a time before Kool-Aid.


RE: I look forward to the day...
By Reclaimer77 on 8/13/2012 3:16:41 PM , Rating: 2
quote:
No matter what you want to say, Reclaimer, the reality is that the persons aligned with the Republican party have, for the last 3+ years had as their sole agenda keeping anything from happening that might have the possibility of making Obama or the democrats look good. It does not matter that the economy, immigration, taxes, etc., etc., etc. do not get better. Just don't let those democrats have one tiny chance at looking good.


Obama and the Democrats had a monopoly on political power his first two whole years of office! The Republicans were in no position to stop anything, and didn't stop anything. I reject this premise that "Republican obstructionism" is the reason everything is so crappy.

quote:
There really is no bipartisan capability in Washington anymore.


That's because "bipartisan" has been redefined as Republicans giving in. Every time. Democrats don't compromise. Democrats don't give in. They just cry foul until we do. And the country suffers!


RE: I look forward to the day...
By Shadowself on 8/13/2012 4:35:43 PM , Rating: 2
quote:
Obama and the Democrats had a monopoly on political power his first two whole years of office!
Interesting. There is no such thing as "monopoly power" in Washinton unless you have a 76% majority in both houses and the Presidency. You seem to forget about certain types of procedural votes that require a 60% or 2/3s or 3/4s majority to actually get things done. It's interesting that you are forgetting about the filibusters and threatened filibusters and the tricks and tactics used to keep things from coming to the floor for full votes those first two years.

Even a minority can cause havoc in each house if they are united and want to stop anything from progressing. You are naive if you don't know that. You are foolish (or worse) if you know this and are just ignoring that it has happened regularly over the last 3+ years.

AND I never said it was Republican obstructionism that caused this problem or even kept it this way. BOTH parties are at fault. BOTH sides won't compromise.

This kind of political gridlock has been growing over the past three decades. It is not new, but I truly believe it is the worst it has been in my long lifetime.

And yes, I DO know whereof I speak. I've personally written drafts of bills that got put into law. I've personally sat down with both congressmen and senators to discuss getting certain things through. I've personally worked with congressional staffers so they understood my position. No, I'm not, and never have been, a lobbyist. I have hired them (and the the last time I hired one well over a decade ago his fee was over $400 an hour), but I've rarely had the stomach to use them.

I am not saying I've always been altruistic. I have not. However, I never pushed a concept that was solely in my own best interest -- and I've occasionally deferred all self interest for the greater good.

It is that last part that seems to have all but evaporated from Washington -- which is part of the reason I got out of the game almost a decade ago.

You claim
quote:
That's because "bipartisan" has been redefined as Republicans giving in. Every time. Democrats don't compromise. Democrats don't give in. They just cry foul until we do. And the country suffers!
Well, the Democrats claim the exact same thing.

I'm not going to search for the link (but I'm sure it's out there for anyone wanting to spend the time to search for it), but the current Speaker of the House stated in an interview within the past year that he'd rather see the economy not improve than see Obama re-elected. I'm sure there are similar statements that have been made by prominent Democrats too -- they'd rather not have certain Republican initiative that might work to improve the country go forth if it meant that Obama might lose.

That really is the problem. "It's either my way or no way at all." It would seem as though in the District of Columbia they have forbidden the use of the word "compromise" and burned every book with that word in it.


"So if you want to save the planet, feel free to drive your Hummer. Just avoid the drive thru line at McDonalds." -- Michael Asher














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