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Content Tagged with motorola + mot

Motorola Ventures today put an undisclosed amount of money into Sunnyvale, Calif.-based startup VirtualLogix, which aims to do for communications equipment and mobile devices what VMware has done for the server. I’m pretty leery of companies throwing around the v-word, but with its take on virtualization, VirtualLogix is actually creating value.

For proof, check out the plans for a sub-$100 multimedia 3G phone developed by Purple Labs using NXP chips running VirtualLogix’s software. The software allows a processor to run a rich operating system on the same chip that controls the baseband access. (In a typical smartphone — depending on the applications and radios needed — this takes two or more chips.) The end result is a high-end feature on a low-end phone using fewer chips. That’s excellent for device makers, but VirtualLogix counts among its investors TI and Intel, two companies that want to sell more chips.

VirtualLogix CEO Peter Richards explained this contrast away by saying the chip vendors just want to make customers happier. But while that may be true, what’s really behind the chip firms’ interest is VirtualLogix’s ability to take software written for single-core chips and run it on multicore chips by virtualizing the multicore hardware. Multicore chips aren’t in phones right now, but given how much we want our handheld devices to do, they will be.

The other beneficiary of virtualizing a communications device is the gear market, where VirtualLogix customers such as Alcatel-Lucent are using the software to combine multiple products, like call routing servers, call management servers, etc., into one box rather than four or five. Virtualization as offered by VMware and Xen is creating a lot of savings by allowing companies to reduce the number of servers they use in data centers, so it stands to reason that it can do the same in the telecommunications world.

Motorola said today it’s exploring strategic options that include selling its handset business. The news comes on the heels of the company announcing a terrible fourth quarter, thanks to continued weakness in the handset business.

Any buyer should look carefully at Motorola’s handset business. By putting it up for sale, Motorola is admitting that the handset division is operationally weak, and to some extent, beyond redemption.

The overreliance on RAZR, and later its inability to get out of the rut of producing phones that never became “hits,” proves that the bureaucratic poundage was weighing the company down. Even if it was operationally sound, the company would need some vision to get back on track and fight it out with the likes of Nokia, Samsung, LG and newcomers likes Apple.

It is a hard fall for a once-proud company, which along with Nokia and Ericsson made up the triumvirate that controlled the wireless business with an iron fist. In order to understand how badly Motorola has stumbled, compare its daily sales of roughly 454,000 with Nokia’s daily sales of 1.3 million.

Recently, companies like Alcatel and Siemens have sold off their handset businesses to Asian handset makers. Those deals didn’t work out too well for the buyers, though. Buyers beware.

The recent executive shuffle at Motorola (MOT) - Ed Zander out, Gregory Brown in - prompted a visit to their press release archives, and what I learnt: there is a constant exodus of senior management. Some leave because they don’t get the top job (CEO) and others are asked to leave because they can’t do the job. Whichever way you look at it - this constant shuffling is a sign of a deeply troubled company, that needs to make some tough strategic decisions about its future.

Here is a short list of those who have come and gone in past five years.

• July 27, 2002: President Ed Breen leaves to join Tyco.
• September 22, 2003: Christopher Galvin, CEO and Chairman is nudged out by the board.
• January 2004: Ed Zander is named CEO.
• January 13, 2005: Mike S. Zafirovski, Motorola’s president and chief operating officer, tipped to get the CEO job resigns and is soon named CEO of Nortel.
• February 19, 2007: Ron Garriques, a key executive incharge of mobile phone division leaves for Dell.
• December 1, 2007: Gregory Brown, COO of Motorola to replace Ed Zander as CEO.
• December 3, 2007: CTO Padmasree Warrior resigns from the company.

Photo by Katie Fehrenbacher/GigaOm via Flickr.