Motorola is to split into two companies - one selling infrastructure and networking equipment, the other left to try and sell handsets against increasing competition.
The split comes as no great surprise. Motorola has been seeking a buyer for its handset unit for months, and the company's news has long been split between optimistic stories about infrastructure wins and downbeat stories about declining handset sales attributed to an inability to compete with Eastern manufacturers.
Motorola's handsets are reasonable devices, but the firm's insistence on supporting every software platform has left it with a confused strategy, and lacking the consistency of user experience that has made its competitors successful.
It is possible that with the right CEO a separated handset division could shake itself down, agree on a single software platform and create some spectacular devices. But it's more likely the company will limp around looking for a buyer and trading on previous successes until it's put out of its misery.
The split should be completed during 2009, with shares in the mobile division being issued to existing shareholders. How long the mobile division survives after that depends on how radically it can be changed and who ends up making those changes. ®