What Happened To Motorola?

[Music] no matter what you look at on a motor roller you get a bigger brighter core a TV picture automatically honestly it seems like Motorola Mobility should have died long ago but it's still here motorola is the company responsible for the first transmission from the moon the name is now synonymous with communication and especially phones wowing business people in the 80s with mobile communication and defining the high social status of razor owners in the 2000s one of the assets that Motorola has is this tremendous brand nowadays Motorola is actually two companies Motorola Solutions and Motorola Mobility solutions the company that produces first responder radios and 911 dispatch software has been flourishing recently mobility the company in charge of mobile phones and other consumer based products has been struggling they are well on their way to profitability which i think is surprising a ton of people the iPhone dominated much of the smartphone competition when it gained a significant market share in the late 2000s and not even a merger with Google could bring Motorola back to its former glory once the iPhone was launched it was the beginning of the end for Motorola as we knew it as a consumer brand in the United States but Motorola Mobility recently made a strong impression on the tech world with the resurrection of its razor series in the form of a folding smartphone I think the new razor is exactly what the company needs its future forward it's using some very exotic technologies the razor product is is gonna be good for them because you can tell already from the amount of headlines it's got a four-season shipping and even though it's only gonna ship in relatively small numbers at a very premium price it does at least reawaken the brand the phone did what numerous previous smartphone models couldn't do for the company it pulled it out of obscurity we think about smart phones in the United States usually think about Apple Samsung LG Google pixel we don't really think about Motorola Mobility the new razor could put Motorola Mobility back on top but it has a long way to go given the fall it took during the smartphone wars motorola was founded in 1928 be me at my bed damiana motorola in the beginning the company's focus was radio systems for governments and businesses and home radios and TVs for consumers in fact the first words from the moon were transmitted from Motorola equipment Motorola is an anchor company in Chicago you know those heritage the car radio is the first radio on the moon yes so many milestones that they've gone through if you look at a lot of the military communications that happen in World War two and even in Vietnam and Korea that was all backed by Motorola a crowning achievement for the company was the first cellular phone call in 1973 I mean they all one of the founders of the industry ultimately they're up there with those big titans motorola employee Martin Cooper is credited with inventing the cell phone the company went on to produce the first commercially available cell phone the DynaTAC to this day we still call it the Zack Morris phone and you can use your cellular phone to order me a pizza there's really bulky handset cost around $4,000 which would be about $10,000 in today's money and it only had about 30 minutes of battery life or 10 hours of standby so didn't last all day motorola kept churning out the hits encouraging people like Ben woods to keep a collection I don't know where's my wife so much she's a bit dismayed about the fact that the garage is absolutely rammed with cell phones but hey by 2004 phones got smaller more people started buying them and Motorola was at the top of the mobile phone game second only to Nokia so before the iPhone there was another phone that everybody had and that was the Motorola RAZR v3 came out in 2004 and it was a huge success for Motorola they sold a hundred and thirty million units my favorite phone was the razor and the 2005 era and what I loved about it is it was so small and when you opened it up you flicked it open everybody was looked at alike oh my gosh I can't believe that the Razr quickly became a social status symbol and pushed Motorola to the first place phone seller in North America yeah they changed the game really they took my ball files from being functional too fashionable but with the coming of the smartphone era Motorola started losing its grip mostly because of Apple's iPhone nobody ever thought Apple was gonna come on and steal any of their market share will really make a dent at all but then in 2007 Apple launched the iPhone and it was a surprise hit Motorola's delayed response to the smartphone boom crippled its competitive edge the Droid was released two years after the launch of the first iPhone if you missed one product cycle in smartphones you have been disrupted you can't miss a beat they worked with Verizon in the US to deliver the droid products because AT&T had got exclusive with the iPhone and that was kind of a last hooray for Motorola even though Droid saw success for Motorola and Verizon sales couldn't keep up with the iPhone Apple had already asserted its dominance and squashed the competition in April of 2010 Apple already had 53% of North America's smartphone market share followed by BlackBerry's parent company rim and that was just three years after Apple released its first iPhone ever Motorola router step at the market they were flat-footed they got too big and at the same time agile Asian competition particularly coming from South Korea with Samsung and LG just outpaced them Motorola eventually had to figure out how it was gonna survive and that's when it started to turn towards Google and Android but that's at the time still Motorola found its mobile business successful enough to spin off into a separate company in 2011 creating Motorola Solutions and Motorola Mobility Google swept in to purchase the newly separated Motorola Mobility for twelve point five billion dollars in 2012 the business was losing money they were losing lots of share it wasn't strategic anymore and eventually that resulted in the sale to Google for whom people had high hopes this gave Google a team of smartphone experts and thousands of smartphone patents this was a huge asset to Google who was fighting with Apple over smartphone patents you had these massive companies who had mobile patent portfolios who were suing each other doing cross licensing you had Microsoft you had Apple you had Google among other and you had companies like Motorola who had built very large patent portfolios and Google who didn't have mobile patent portfolio had nothing to defend with had nothing to countersue with had nothing ago she ate with together Google and Motorola focused on more affordable smartphones I remember when Google acquired Motorola Mobility it seemed like a really good thing for most of us because it would allow it seemed Google to put Motorola Mobility back on the map with these really clean and fresh Android phones that could allow Google and Motorola Mobility to compete directly against Apple in the end that's not what actually happened sort of faltered even though it launched some compelling handsets Motorola's North American market share for smart phones dropped from 6% to 3% during its time under Google while Apple jumped from 46% to 53% it's very hard to take a hardware point of view insert that into an advertising company and have something good around it even though Google was the birthplace of Android I believe it's set it back and actually put more distance between Motorola and companies like Apple Google sold Motorola Mobility in 2014 to Chinese computer company Lenovo for 2.9 billion dollars nine point six billion dollars less than what it pay for the company I think it said hey we're not making money off of this business but we have the patents so we can now defend ourselves with Android if Apple or anybody else wants to sue and Lenovo saw the value in Motorola Mobility the Novo branded smartphone business was doing okay in China but wasn't really doing anywhere else and Lenovo thought that bringing in the Motorola brand they would do a lot better in the Americas and in Western Europe today Motorola still lags behind much of its competition in quarter 3 of 2019 Lenovo which includes Motorola Mobility had a smartphone market share of 8% you know and we're now in a situation where we have a duopoly really of Samsung and Apple dominating the total market the past few years have been pretty boring for Motorola it hasn't launched any flagships that compete with Apple's best or Samsung's best phones but that's about to change motorola recently revealed its new razor folding smartphone which impressed reviewers during the first look but is not expected to make a huge splash in the market it was very hard for them to get attachment in the premium space up there with Samsung and Apple so I think perception wise this is exactly what it needs in its kind of homogeneous sea of smartphone sameness where all the devices look the same nothing jumps out and that's where I believe that the Razer strategy is a good work it's really hard to imagine what the world would look like without Motorola's innovation radios televisions transmissions from space cell phones all of these would be very different today without Motorola and Motorola Solutions the company that produces radios for first responders software for 911 dispatchers and other non consumer products is flourishing Solutions stock rose 332 percent from January 2011 the month and year Motorola Solutions and Mobility split to November 2019 Lenovo the current owner of Motorola Mobility had an increase of just 14 percent in the same 8 year time frame on the Hong Kong Stock Exchange in my time as a journalist I've seen lots of brands go and I haven't seen many brands come back motorola has been on the way out for years and even if it does have a successful foldable phone or a really nice flagship next year and needs a lot more than that to come back to the top I do think there is hope for Motorola to be a a relevant vendor over the next 10 years things are looking up for Motorola Mobility but it might never reach its former glory even if they could get to a point where they were able to secure a meaningful market share start getting consumers to at least have some consideration for their products which I think the raise will help do then that's the very very early stages of the path to recovery

Channel: CNBC

Views: 893,626

Rating: 4.8259163 out of 5

Keywords: CNBC, business, news, finance stock, stock market, news channel, news station, breaking news, us news, world news, cable, cable news, finance news, money, money tips, financial news, Stock market news, stocks, motorola, old cellphone, best phones ever, my old phones, the verge, unbox therapy, marques brownlee

Id: _N6MFQyRq_c

Length: 11min 41sec (701 seconds)

Published: Sat Dec 21 2019