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Spin-offs Case Study

Case Title:

Motorola to Split the Cell- Phone Business: The End of an Era?

Publication Year : 2010

Authors: S Paul, I Chakraborty

Industry: Telecommunications


Case Code: SPN0009IRC

Teaching Note: Not Available

Structured Assignment: Not Available

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Motorola Inc, a US based electronics and communications company, was one of the pioneers in mobile handset manufacturing. With its focus on technology and innovation, it remained the largest mobile handset manufacturer in the world till the mid-1990s. However, Nokia overtook its position in the late 1990s, and by mid 2007, Samsung Electronics overtook it as well, pushing it into third position. Analysts felt that failing to launch new innovative handsets after RAZR (in 2004), lagging behind its competitors on the technology aspect and its delayed entry into the developing markets, were some of the reasons for Motorola's decline. In March 2008, to focus on the profitability of its handset business, Motorola was divided into two independent, publicly traded companies, namely, Mobile Devices and Broadband & Mobility Solutions Businesses.

Pedagogical Objectives:

  • To get an insight into the decline of Motorola from being the largest mobile handset manufacturer to the third largest
  • To understand the underlying problems behind Motorola's decline
  • To analyse whether spinning off the handset business would be a fruitful decision for the company.

Keywords :  Motorola, Split, Mobile handset, RAZR, Nokia, Samsung Electronics, Ultra-slim handset, Motorola market share, GSM (global system for mobile communications), CDMA (code division multiple access), 3G (third generation) technology, iPhone, Sony Ericsson, North American phone market, Motorola mobile devices business

Contents : 
Motorola - Rising to Glory
Splitting the Handset Business: Will it be Beneficial?
Market Share of Global Mobile Handset Manufacturers in 2007
Motorola Geographic Area Information
Global Mobile Handset Market Share (1994-2004)

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