|Founded||January 4, 2011|
Chicago, Illinois, U.S.
|Employees||3,466 (Q3 2014)|
Motorola Mobility is an American mobile device manufacturer headquartered in Chicago, Illinois. The company was formed on January 4, 2011 by the split of Motorola Inc. into two separate companies; Motorola Mobility took on the company's consumer-oriented product lines, including its mobile phone business and its cable modems and set-top boxes for digital cable and satellite television services, while Motorola Solutions retained the company's enterprise-oriented product lines.
The company primarily manufactures smartphones and other mobile devices running the Android operating system developed by Google Inc.; in August 2011, only several months after the split, Google announced that it would acquire Motorola Mobility for US$12.5 billion. Google's intent for the purchase was to gain control of Motorola Mobility's portfolio of patents, so it could adequately protect other Android vendors from lawsuits. The deal closed in May 2012, after which it also sold its cable modem and set-top box business to Arris Group. Under Google ownership, Motorola Mobility increased its focus on the entry-level smartphone market, introduced one of the first Android Wear smartwatches, and also began development on Project Ara, a platform for modular smartphones with interchangeable components.
Google's ownership of the company would be short-lived, as it announced in January 2014 that it would sell most of Motorola Mobility to Chinese personal computer and mobile device maker Lenovo for $2.91 billion in cash and roughly 6% of Lenovo shares. The sale, which excluded all but 2000 of Motorola Mobility's patents and the team working on Project Ara (which became part of the main Android development staff), was completed on October 30, 2014. Lenovo disclosed an intent to use its purchase of Motorola Mobility as a way to expand into the U.S. smartphone market.
On January 4, 2011, Motorola Inc. was split into two publicly traded companies; Motorola Solutions took on the company's enterprise-oriented business units, while the consumer divisions were spun off to form Motorola Mobility. Motorola Mobility consists of the Mobile Devices business which produces smartphones and the Home business which produces set-top boxes, end-to-end video solutions, and cable modems.
On August 15, 2011, Google announced that it would acquire Motorola Mobility for $12.5 billion, pending regulatory approval. Critics viewed Google as being a white knight, since Motorola had recently had a fifth straight quarter of losses. Google planned to operate Motorola as an independent company. In a post on the company's blog, Google CEO and co-founder Larry Page revealed that Google's acquisition of Motorola Mobility was a strategic move to strengthen Google's patent portfolio; at the time, the company had 17,000 patents, with 7,500 more patents pending. The expanded portfolio was to defend the viability of its Android operating system, which had been the subject of numerous patent infringement lawsuits between device vendors and other companies such as Apple Inc., Microsoft and Oracle Corporation.
On November 17, 2011, Motorola announced that its shareholders voted in favor of the company's acquisition by Google Inc. for $12.5 billion, receiving approval from the United States Department of Justice and the EU on February 13, 2012. The deal received subsequent approval from Chinese authorities and was completed on May 22, 2012. Alongside the completion of the acquisition, Motorola Mobility's CEO Sanjay Jha was replaced by Dennis Woodside, a former Senior Vice President at Google.
On August 13, 2012, Google announced that it would cut 4,000 employees and close one third of the company's locations, mostly outside the United States.
In May 2013, Motorola opened a factory in Fort Worth, Texas, with an intent to manufacture smartphones in the United States. At its peak, the factory employed 3,800 workers. On April 9, 2014, following the departure of Woodside, lead product developer Rick Osterloh was named the new president of Motorola.
Under Google ownership, Motorola's market share would be boosted by a focus on high-quality entry-level smartphones, aimed primarily at emerging markets; in the first quarter of 2014, Motorola sold 6.5 million phones—led by strong sales of its low-end Moto G, especially in markets such as India, and in the United Kingdom—where the company accounted for 6% of smartphone sales sold in the quarter, up from nearly 0. These goals were compounded further by the May 2014 introduction of the Moto E—a low-end device aimed at first-time smartphone owners in emerging markets. In May 2014, Motorola announced that it would close its Fort Worth factory by the end of the year, citing the high costs of domestic manufacturing in combination with the weak sales of the Moto X (which was customized and assembled at the plant) and the company's increased emphasis on low-end devices and emerging markets.
Acquisition by Lenovo
On January 29, 2014, Google announced it would, pending regulatory approval, sell Motorola Mobility to the Chinese technology firm Lenovo for US$2.91 billion in a cash-and-stock deal, seeing the sale of $750 million in Lenovo shares to Google, giving it a roughly 6% stake. Google retained the Advanced Technologies & Projects unit and reintegrated it into the main Android team, and all but 2000 of the company's patents. Lenovo had prominently disclosed its intent to enter the U.S. smartphone market, and had previously expressed interest in acquiring BlackBerry Limited, but was reportedly blocked by the Canadian government due to national security concerns. Lenovo's CEO Yang Yuanqing stated that "the acquisition of such an iconic brand, innovative product portfolio and incredibly talented global team will immediately make Lenovo a strong global competitor in smartphones".
The acquisition was completed on October 30, 2014. The company will remain headquartered in Chicago, and continue to use the Motorola brand, but Liu Jun—president of Lenovo's mobile device business, became the company's chairman.
In development since July 2003, Motorola released the Razr V3 in the third quarter of 2004. Because of its striking appearance and thin profile, it was initially marketed as an exclusive fashion phone, but within a year, its price was lowered and it was wildly successful, selling over 50 million units by July 2006. Over the Razr four-year run, Motorola sold more than 130 million units, becoming the bestselling clamshell phone in the world.
Motorola released other phones based on the Razr design as part of the 4LTR line. These include the Pebl U6, Slvr L6, Slvr L7 (more expensive variant of Slvr L6), Razr V3c (CDMA), Razr V3i (with upgraded camera and appearance), V3x (supports 3G technology and has a 2-megapixel camera), Razr V3xx (supports 3.5G technology) and Razr maxx V6 (supports 3.5G technology and has a 2-megapixel camera) announced on July 2006.
The Razr series was marketed until July 2007, when the succeeding Motorola Razr2 series was released. Marketed as a more sleek and more stable design of the Razr, the Razr 2 included more features, improved telephone audio quality, and a touch sensitive external screen. The new models were the V8, the V9, and the V9m. However, Razr2 sales were only half of the original in the same period.
Because Motorola relied so long upon the Razr and its derivatives and was slow to develop new products in the growing market for feature-rich touchscreen and 3G phones, the Razr appeal declined while rival offerings like the LG Chocolate, BlackBerry, and iPhone captured consumer attention, leading Motorola to eventually drop behind Samsung and LG in market share for mobile phones. Motorola's strategy of grabbing market share by selling tens of millions of low-cost Razrs cut into margins and resulted in heavy losses in the cellular division.
Motorola capitalized on the Razr too long and it was also slow adopting 3G. While Nokia managed to retain its lead of the worldwide cellular market, Motorola was surpassed first by Samsung and then LG Electronics. By 2007, without new cellphones that carriers wanted to offer, Motorola sold tens of millions of Razrs and their offshoots by slashing prices, causing margins to collapse in the process. In January 2007, then-CEO of Motorola Ed Zander rode a yellow bike onto the stage in Las Vegas for his keynote speech at the Consumer Electronics Show. Zander departed for Dell, while his successor failed to turn around the struggling mobile handset division.[not in citation given]
Motorola continued to experience severe problems with its cellphone/handset division in the latter-2000s, recording a record $1.2 billion loss in Q4 2007. Its global competitiveness continued to decline: from 18.4% market share in 2007, to 9.7% by 2008. By 2010 Motorola's global market share had dropped to seventh place, leading to speculation of bankruptcy of the company. While Motorola's other businesses were thriving, the poor results from the Mobile Devices Unit as well as the 2008 financial crisis delayed the company plans to spinoff the mobile division.
In 2008, Sanjay Jha took over as co-chief executive officer of Motorola's mobile device division; under Jha's control, significant changes were made to Motorola's mobile phone business, including most prominently, a shift to the recently introduced Android operating system as its sole smartphone platform, replacing both Symbian and Windows Mobile. In August 2009, Motorola introduced the Cliq, its first Android device, for T-Mobile USA. The device also featured a user interface known as Motoblur, which aimed to aggregate information from various sources, such as e-mail and social networking services, into a consistent interface.
A month later, Motorola unveiled the Droid, Verizon Wireless's first Android phone, which was released on November 8, 2009. Backed with a marketing campaign by Verizon, which promoted the device as a direct competitor to the iPhone with the slogans "iDon't" and "Droid Does", the Droid was a significant success for Motorola and Verizon; Flurry estimated that at least 250,000 Droid smartphones had been sold in its first week of availability. PC World considered the sales figures to be an indicator of mainstream growth for the Android platform as a whole. The Droid was also named "Gadget of the Year" for 2009 by Time. Other Droid-branded devices would be released by Verizon, although not all of them were manufactured by Motorola.
In 2010, Motorola released the Droid X as a successor, along with other devices such as the Charm, Flipout, and i1. In July 2010, Motorola reported that it had sold 2.7 million smartphones during the second quarter of 2010; an increase of 400,000 units over the first quarter. Jha stated that the company was in "a strong position to continue improving our share in the rapidly growing smartphone market and [improve] our operating performance." In its third quarter earnings report, Jha reaffirmed that the Droid X was selling "extremely well".
Atrix 4G, Droid Bionic, XOOM, and Droid RAZR
On January 5, 2011, Motorola Mobility announced that the Atrix 4G and the Droid Bionic were headed to AT&T and Verizon, respectively, with expected release dates in Q1 of 2011. The Atrix was released on February 22 as the world's first phone with both a Dual-Core Processor and 1 GB of RAM.[unreliable source?] The phone also had optional peripherals such as a Multimedia Dock and a Laptop Dock which launched a Webtop UI.[not specific enough to verify] On February 24, two days after the release of Atrix, the company released Motorola Xoom, the world's first Android 3.0 tablet,[unreliable source?] and followed it up shortly afterwards with an update to make it the world's first Android 3.1 tablet.
In the fourth quarter of 2011, Motorola unveiled the Droid RAZR, the world's thinnest 4G LTE smartphone at that time at just 7.1 mm. The Droid Razr featured Kevlar backing, the same used in bulletproof vests, and a Gorilla Glass faceplate.
Though Jha managed to restore some of the lost luster to Motorola Mobility, through its last years as a division and then as an independent company, it still struggled against Samsung and Apple. Even among Android manufacturers, Motorola had dropped behind Samsung, HTC, and LG in Q2 of 2011. This may have been attributed to the delay in releasing 4G LTE-capable devices, as well as setting the prices of its new products too high.
In an August 2013 interview, Motorola Corporate VP of product management Lior Ron explained that the company will focus on the production of fewer products to focus on quality rather than quantity. Ron stated, "Our mandate from Google, from Larry, is really to innovate and take long-term bets. When you have that sort of mentality, it’s about quality and not quantity".
Speaking at the D11 conference in Palos Verdes, California, in May 2013, Motorola CEO Dennis Woodside announced that a new mobile device would be built by his company at a 500,000 square-feet facility near Fort Worth, Texas, formerly used by Nokia. The facility will employ 2,000 people by August 2013 and the new phone, to be named "Moto X", will be available to the public in October 2013. The Moto X featured Google Now software, and an array of sensors and two microprocessors that will mean that users can “interact with [the phone] in very different ways than you can with other devices”. Media reports suggested that the phone will be able to activate functions preemptively based on an "awareness" of what the user is doing at any given moment.
On July 3, 2013, Motorola released a full-page color advertisement in many prominent newspapers across the United States. The advertisement claimed that Motorola's next flagship phone will be "the first smartphone designed, engineered, and assembled in the United States". On the same day that the advertisement was published, ABC News reported that customers will be able to choose the color of the phone, as well as add custom engravings and wallpaper at the time of purchase.
In early July 2013, the Wall Street Journal reported that Motorola will spend nearly US$500 million on global advertising and marketing for the device. The amount is equivalent to half of Apple's total advertising budget for 2012.
On November 13, 2013, Motorola Mobility unveiled the Moto G, a relatively low-cost smartphone. The Moto G will be launched in several markets, including the UK, United States, France, Germany, India and parts of Latin America and Asia. The Moto G is available in the United States, unlocked, for a starting price of US$179. The device is geared toward global markets and some US models support 4G LTE. Unlike the Moto X, the Moto G is not manufactured in the United States.
The Moto E was announced and launched on May 13, 2014.. Released in the wake of its successful first generation, the Moto E is an entry-level device that is intended to compete against feature phones by providing a durable, low-cost device for first-time smartphone owners or budget-minded consumers, with a particular emphasis on emerging markets. The Moto E ships with a stock version of Android 4.4 "KitKat".
Moto 360 is a round smartwatch, powered by Google's Android Wear OS, a version of Google's popular Android mobile platform specifically designed for the wearable market. It integrates Google Now and pairs to an Android 4.3 or above smartphone for notifications and control over various features.
- Samsung Electronics
- Apple Inc.
- BlackBerry Ltd
- LG Electronics
- Sony Mobile Communications
- Microsoft Mobile (formerly Nokia)
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