Motorola Solutions, Inc. (MSI)

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Georgia

Matthew Martos

Motorola Mobility Holdings (NYSE: MMI) Motorola Mobility is the former Mobile Devices division of Motorola (MOT), spun off in a restructuring that left Motorola Mobility as a public independent company, officially listed on January 4th, 2011. With this new structure, Motorola Mobility will own and license the brand to Motorola Solutions. As part of the reorganization, Motorola agreed in 2010 to sell most of its wireless network infrastructure business to Nokia Siemens Networks Nokia (NOK) for $1.2 billion in cash. Motorola Solutions now focuses on products for business and government clients such as two-way radios, mobile computers, bar code scanners, public safety communications systems, and wireless broadband products. In fiscal year 2010, MMI recorded revenues of $19.3 billion and net income of $633 million. With the recent spinoff of Motorola Mobility, Motorola Solutions can better focus on its core businesses of providing radio systems, mobile computing, radio products, data capture, system integration, and other services.

Business Overview

Motorola Solutions is the developer of the the first mobile phone, but it has struggled to regain its market share in the wireless handset market. Its market share declined significantly the last few years. MSI primarily serves education, government, healthcare, hospitality, human services, manufacturing, mobile operators, and wholesale distribution industries.

Business Segments

Originally, Motorola's business is divided into three primary segments--Enterprise Mobility Solutions, Mobile Devices, and Home. Motorola Solutions encompasses the Enterprise Mobility Solutions segment after the spinoff.

Enterprise Mobility Solutions

The Enterprise Mobility Solutions segment represents 41% of the consolidated Motorola company revenues and 100% of MSI's revenues. Enterprise Mobility Solutions designs, manufactures, sells, and installs analog and digital two-way radios, wireless LAN and security products, voice and data communication products. These products are implemented in private networks, wireless broadband systems, and end-to-end enterprise mobility solutions.

Trends and Forces

Increasing Focus on Core Business

With the recent spinoff of Motorola Mobility, Motorola Solutions can better focus on its core businesses of providing radio systems, mobile computing, radio products, data capture, system integration, and other services. Motorola Solutions can better expand into the new markets in the government and enterprise segments--next generation public safety LTE, integrated command & control, mobile broadband devices, and networking and converged communications. To continue leading the government and enterprise segments, Motorola will continue to focus on research and development, adding to its strong intellectual property portfolio of about 10,000 granted or pending patents.

Increasing Focus on New Ventures Through Motorola Solutions Venture Capital

Motorola hopes to gain a competitive advantage by developing new technology innovation through investing in Motorla Solutions Venture Capital. The venture capital group currently manages 20 portfolio companies and plans to invest in 5-6 more start-up companies in 2011. Motorola's investment priority for 2011 is a focus on technologies that support the company’s public safety and enterprise mobility businesses, such as mobile computing, cloud computing, video and video analytics, retail experiences and analytics, RFID-enabled solutions and security. For example, Motorola Solutions Venture Capital recently invested in ViVOtech Inc, a near-field communication software and systems company. This venture will give Motorola a stronger position in enriched mobile commerce solutions for in-store payment, loyalty, marketing and merchandising. ^[1]