Motorola has spun-off its largest and least successful unit, its handset business. Motorola once commanded more than one-fifth of the global handset market, but ended the second quarter close to a 8.5% share.
The company will now comprise three businesses: broadband home solutions, broadband access solutions and cellular networks, the company said. Motorola will create three businesses within its home and networks mobility business.
“This organizational change will ensure that home and networks mobility remains agile, focused and ideally aligned to realize its growth potential,” Motorola said in a statement obtained by Reuters.
In March, Motorola said it would split into two publicly traded entities in 2009, separating its mobile phone unit from the rest of the business, which makes television set-top boxes and network equipment.
Meanwhile, Verizon Communications today reported continued strong results in the second quarter 2008. The wireless carrier reported the highest net adds in the industry – 1.5 million net customer additions; 68.7 million total customers; 66.7 million retail (non-wholesale) customers, most in the industry, up 11.0 percent. Data revenues were up 45.3 percent with a 45.6 percent EBITDA margin. (EBITDA is earnings before interest, taxes, depreciation and amortization.)
Currently, Verizon’s 68.7 million mobile subscribers, the 2nd largest wireless carrier in the U.S., lags behind AT&T which has some 73 million subscribers. When Verizon completes their $28.1 billion purchase of Alltel, which has 13 million customer, Verizon will be the largest carrier in the United States. Verizon Wireless is jointly owned by European phone company Vodafone, the world’s largest cellular company, with some 260 million customers in 25 markets across 5 continents.
In other financial news, China Telecommunications, the national fixed line carrier, is buying China Unicom’s CDMA business, which has about 43 million customers, for US$6.4 billion, but will not own the physical network assets, reports Unstrung. It’s part of the radical revamp of China’s telecom sector. (See China Begins $70B Carrier Revamp.)
The operator’s state-owned parent, China Telecom Group, will lease the infrastructure to its service provider subsidiary. In 2007, China Unicom’s CDMA service revenues totaled US$4.1 billion.
