Motorola, the maker of such popular models as Razr and Rokr, may be set to bid farewell to the iconic Moto, as it struggles to stem the declining sales at its troubled handset division. "We are exploring ways in which our mobile devices business can accelerate its recovery and retain and attract talent while enabling our shareholders to realize the value of this great franchise," said Greg Brown, CEO, Motorola, who recently took over the reins of America's largest wireless handset maker from the legendary Ed Zander, giving enough hint about the likely fate of its cell phone business.
Motorola, which pioneered mobile technology in the 1930s and then personalized communications five decades later with the first commercial hand-held cellular phone, has struggled to keep pace with both rivals and changing consumer preferences after it lost its global leadership to Nokia in the 1990s. Although it had some success on and off with models such as the Razr in 2004 and the Rokr later, the company has largely failed to capitalize on such gains.
The possibility of a break-up looks for real now as the cell phone maker continues to make losses.
For instance, in the recently concluded full year 2007, the cell phone division incurred a loss of $1.2 bn on sales of $19 bn, down 33% over the previous year; the cell phone sales accounted for more than 50% of the mobile maker's total revenues of $36.6 bn in the same year. The company also shipped lesser phones; phone shipments plunged 38% in the fourth quarter, as it lost out to rival iPhone from Apple and camera phones from Samsung. |
