Motorola Splits

Posted by Sam Churchill on

Motorola Mobility, maker of Droid smartphones, has completed a spinoff from parent company Motorola, the company announced Tuesday (pdf). The company, which had revenues of $22 billion last year, is splitting into two separate companies; Motorola Mobility and Motorola Solutions, a land mobile radio and services company for enterprise and government customers.

Motorola Mobility will have two subsidiaries, the mobile devices division, which will focus on new smartphones and tablets, and the home division which will focus on set-top boxes and video products.

Motorola’s success in 2010 was largely driven by smartphones. The company expects to have shipped between 12 to 14 million units for the year. In the third quarter of 2010, Motorola posted an operating profit of $3 million for its mobile devices unit for the first time in about four years, as the company shipped 9.1 million phones, including 3.8 million smartphones.

Shares in Motorola Mobility and Motorola Solutions formally begin trading today (4 January). Motorola Mobility will trade under the MMI ticker, while Motorola Solutions will use the MSI ticker.

Separately, the US$1.2 billion sale of the majority of Motorola’s networks unit to Nokia Siemens Networks (NSN) has been delayed pending regulatory approval from China’s competition authority. NSN said at the end of December that it now expects the deal to close in the first quarter of 2011.

The Anti-Monopoly Bureau of China’s Ministry of Commerce is continuing its review process. “This delay is disappointing, but we’re looking forward to completing the acquisition early in the new year,” said Rajeev Suri, CEO of Nokia Siemens Networks. Nokia Siemens Networks had 2009 revenues of $12.5 billion.

Ericsson is currently the world’s largest mobile telecommunications equipment vendor with a market share of 35%. It bought CDMA and LTE assets of bankrupt Nortel Networks for $1.13 billion. In Q3 of 2009, Huawei surpassed Nokia Siemens Networks to became the No. 2 supplier of global mobile network gear, according to researcher Dell’Oro. Huawei expects to double the number of commercial LTE contracts it has next year, and anticipates LTE-related revenue will make up a significant portion of its sales by 2014, reports Fierce Wireless. Alcatel-Lucent which bought assets of Lucent Technologies and ZTE are battling for forth place.

Dell’Oro predicts global LTE deployments will exceed $6 billion by 2014, with annual revenues of the overall annual infrastructure market revenues forecast to reach $43 billion over the next 5 years.

The five biggest telecom equipment manufacturers in the world, Ericsson, Nokia Siemens Networks, Huawei, Alcatel Lucent and ZTE aim to get a piece of that action.

Posted by Sam Churchill on Tuesday, January 4th, 2011 at 10:05 am .

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