Commentary
3/26/2008
01:36 PM
Jake Widman
Jake Widman
Commentary

Motorola to Spin Off Handset Business

CNET News, Associated Press via New York Times



Venerable mobile communications vendor Motorola announced that it will split into two separate companies, one devoted to mobile handsets and the second to other communications products.Motorola's cell phone division typically accounts for more than half the company's revenue, but in recent years its competitors have had the most popular phones. The company's global market share has fallen from 20 percent last year to 12 percent today, and it now trails both Nokia and Samsung in the market.

After the split, the Mobile Devices business will take over the handset and accessory side of things, while the Broadband and Mobility Solutions business will be in charge of both enterprise mobility products such as voice and data communications solutions and wireless broadband, and home and network products such as set-top boxes and modems. Chief Executive Greg Brown said that the separate businesses could be more focused on their own niches: "The creation of the two independent publicly traded companies provides improved management focus and a capital structure that's more tailored to the individual business needs. It will provide some improved alignment and agility and will help us going forward."

The division is expected to be completed during 2009, with shares in the mobile division being issued to existing shareholders.CNET News, Associated Press via New York Times

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