Motorola splits in two

A phone display at a Motorola store

TEXT OF STORY

JEREMY HOBSON: Today, Motorola is breaking up. The telecommunications company which was founded in Chicago back in 1928 is splitting in two.

Marketplace's Jennifer Collins reports.


Jennifer Collins: Motorola makes the Droid X, one of the hottest smartphones on the market. The company also does big business with police and fire departments.

Edward Snyder: Motorola has been number one in public safety radios since dirt was invented.

Edward Snyder of Charter Equities Research says the public safety business helped keep Motorola afloat when its cell phone business was losing a billion dollars a year.

Snyder: The company would have never survived through the down cycle between 2007 and 2010.

In the split, Motorola Solutions gets the more stable parts of the business like radios and scanners. Motorola Mobility will make the riskier gadgets like smartphones. Matthew Thornton of Avian Securities says even the mobile business looks solid these days.

Matthew Thornton: They're not trying to be all things to everyone. They're much more focused and almost exclusively focused on the smartphone category, which is growing like a weed.

And he expects it to stay profitable, thanks in part to a new product. A computer tablet Motorola is expected to unveil this week.

I'm Jennifer Collins for Marketplace.

About the author

Jennifer Collins is a reporter for the Marketplace portfolio of programs. She is based in Los Angeles, where she covers media, retail, the entertainment industry and the West Coast.

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