Strategy Analytics Comments on Motorola Break-Up

According to Strategy Analytics, Motorola’s decision earlier today to break the company up into two separate entities is a step in the right direction. This move will enable Motorola to focus on two of its core competences — in mobile handsets and the digital home. However, this short-term financial fix must not distract Motorola from its long-term operational problems.

Peter King, Director of the Connected Home service at Strategy Analytics, said, “We have long argued that Motorola remains less than the sum of its parts, as far as its consumer strategy is concerned. With leading positions in mobile and connected-home, Motorola should be driving the market forward with original consumer technology concepts. But we see little sign that it is maximizing that potential. Separation should help the company direct its efforts more effectively toward broadband and digital opportunities. This announcement is a step in the right direction.”

Bonny Joy, Wireless Analyst at Strategy Analytics, added, “A spin-off of the mobile division will enable Motorola to focus on its core competence in cellular handsets. However, we emphasize that this short-term financial fix must not distract Motorola from its long-term operational problems. Motorola Mobile still badly needs to address its core problems of an ineffective supply chain, a weak 3G component strategy and an unattractive 3G handset portfolio.”

About Strategy Analytics
Strategy Analytics, Inc focuses on market opportunities and disruptive forces in the areas of Automotive Electronics and Entertainment, Broadband Connected Home, Mobile & Wireless Intelligent Systems Implementation Strategies and High Frequency Market intelligence. Headquartered in Boston, MA, with offices in the UK, France, Germany, Japan, S. Korea and China, Strategy Analytics works with clients through annual multi-client services, management team workshops and custom consulting engagements.