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Motorola pondering exiting the cell business?

updated 12:00 pm EST, Tue January 29, 2008

Motorola May Exit Cell Biz

Motorola may be looking to fold its cellphone business after years of struggling to restore the business to profit, says an investor note from Nomura analyst Richard Windsor. After a damaging quarter that saw Motorola's cellphone sales suffer a 38 percent drop, the company is said to be considering closing the division entirely to stem losses. This would leave the remaining divisions to focus chiefly on government and large-scale business sales, Windsor says. Notably, Motorola would still appear in the mainstream market through its technologies, which include WiMAX handheld chipsets and mobile TV devices.

The Nomura researcher does not say how quickly he would expect Motorola to phase out its cellphone offerings or whether this would extend to add-ons, which also include peripherals such as Bluetooth headsets and speakerphones.

Motorola is one of the few major worldwide cellphone manufacturers to be losing marketshare. In 2007, the company's overall share dropped from 23 percent of the market to just 13 percent, most of which went to its immediate rivals. Nokia in particular owns 40 percent of the entire market while Sony-Ericsson and Samsung have also been making progress in the market.

The news comes as Motorola's smartphones are said to be eating at HTC's marketshare and providing the company with gains in the relatively small but growing Windows Mobile phone business.

by MacNN Staff



  1. climacs

    Joined: Dec 1969



    my father was a lifer at Motorola when they were also involved in government defense contracting and chipmaking (at a much larger scale than present). Let's not forget Iridium, on which the company staked its future. It ended up being sold off for pennies on the dollar. The handsets were gigantic, bulky, the service was expensive and IT DIDN'T WORK INDOORS!

    I wouldn't be surprised if they sell off the cellphone business (fold it? yeah right). Still, it's sad. When just about everybody has a RAZR, how could they have failed? I think the company has been run/staffed by too many engineers and not enough of the human touch.

    There's a book or two to be written about what happened to Motorola.

  1. Arty50

    Joined: Dec 1969


    It's the software

    Motorola makes some great phone hardware. Specifically, the reception is generally excellent on their phones.


    The software is horrible. I had a V600 for a long time, and finally after a lot of abuse it just got too quirky. So I switched to a Sony Ericsson phone and I can't believe I didn't do it sooner. The phone software itself blows away the moto offerings. The address book is much more robust and the texting method is vastly superior to my old phone.

    Everyone I know who's either switched to Moto and/or switched after owning one says the same thing. Sure the Razr is a really nice piece of hardware, but the software that runs it blows.

  1. climacs

    Joined: Dec 1969


    remember how

    Motorola's CEO got pissed at Jobs/Apple when the ROKR came out and Jobs treated it like an afterthought at the show where he intro'd it?

    Guess who got the last laugh on that one. CEO shoulda been looking for a job at Apple... And yeah, the ROKR was a STNKR.

  1. testudo

    Joined: Dec 1969


    Re: remember how

    Well, wouldn't you be mad as well if you spent a boatload of money and time with this cross-over device, the first to play iTunes and all, and then the Apple-God himself just ignores it, which means no RDF buying by the mac-adoring public.

    And I'm not sure what you mean by "who got the last laugh". That would apply if, say, Motorola used apple to gain a quick market and then toss apple to the side, then find themselves on the side now. This situation doesn't apply.

    But it also makes you wonder whether a nice lawsuit could be in the offing from Motorola against Apple (shouldn't be too surprising, pretty much everyone sues apple, I think it's one of those SBA rules or something), arguing Apple used their partnership to stealthily steal their phone technology and exptertise and then used it in building the iPhone (we're talking hardware here, of course, not software).

  1. Stogieman

    Joined: Dec 1969


    Re: Testudo

    What are you talking about? Motorola didn't spend a butload of money developing the Rokr. The ROKR is essentially a re-badged Motorola E398 with iTunes software.

  1. UberFu

    Joined: Dec 1969


    re: testudo

    Open mouth insert foot!

    They have no case most likely as Apple probably had a single timed limited partnership to develop the ROKR concept without having a long-term R&D and future product commitment_ Both Apple and Motorola have been doing business long enough with corporate partnerships and I'm positive that contract had all of it's I's dottted and T's crossed_

    And suing someone just because 20 other lawsuits agasint them are pending is not a valid or legal reason to sue someone_

    Is it me or is does anyone else feel the strain when Testudo "speaks" ?

  1. UberFu

    Joined: Dec 1969



    before this Motorola spun off it's Semi-Conductor section and thus downs-ized itself for a pay out and that happened only a few years ago_

    BUT lest we keep in mind that right now it's some "analyst" speculating things as we are quick to jump on some no name "analyst" bad-mouthing Apple and it's eminent demise - so too should we hold off judgement on Motorola turning Bottom Up_

    For years they have developed technologies and spun off companies or sold sections to other companies only to turn around and dive into new territory that infuses the tech market once again_

    The RAZR was the it thing in 2005 and every other person I see these days has a RAZR_ their processor tech is built into Blackberry's - which are the leading smartphone on the market_ They have a good foot-hold in the server industry_

    Then again - they could be gone tomorrow_ But I doubt it_

  1. michaelper22

    Joined: Dec 1969


    Hello Moto, Bye-Bye Moto

    Good greif. I have a Motorola i855 handset marketed by Boost Mobile, which, compared to any other modern handset, is simply garbage. Motorola has failed to make any of their iDEN series phones any good, and consumer users of Nextel, Boost Mobile, and other US and international carriers suffer.

    Maybe this will be the last straw on the camel's back before Sprint eliminates their iDEN network. The aging service platform has only a few features that mainly benefit the enterprise /industrial users. And I hear that Sprint is attempting to replicate the Direct Connect (aka Chirp or Walkie Talkie) on their CDMA network.

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