Once upon a time, Google was run like a playground; it was the sort of place where you'd get points for attending the Burning Man hippie drug fest. Under new CEO Larry Page, we're seeing a more ruthless Google — the sort of company perfect comfortable turning its business partners into creepy sock puppets today.
We knew there would be last-minute dirty tricks in this campaign — but who knew they would include attempting to turn the powerful Apple fanboy vote? iPhone Savior has revealed, with suspicious timing, that Democratic presidential nominee Barack Obama uses a desperately uncool Motorola Razr, not the iPhone spotted in his hands back in May. Then again, maybe Obama's trying to appeal to America's industrial heartland; Motorola is based in the suburbs of Chicago, where Obama has his campaign headquarters. Or, possibly, he just wants to make phone calls.
This is the layoff that matters. Motorola has already conceded to a demand by investment overlord Carl Icahn to spin off its money-losing mobile phone unit. Today's news is no surprise, but still: Motorola will ditch about 3,000 people through several agonizing waves of layoffs. Co-CEO Greg Brown is telling the press that Moto will save $800 million in 2009. In a conference call today, Brown's peer Sanjay Jha said Moto had been too focused on "bright, shiny objects." Now, the company will focus on dim, dull profits.Update: AP's photo library actually gave us a photo of another Greg Brown altogether, taken for a story on voicemail etiquette. Having looked at all of the corporate headshots of Motorola's Brown, we're sticking with this guy — he'd probably do a better job running Motorola, too. (Photo by AP/Alan Diaz)
"When my wife switches, then you'll know," says Motorola co-CEO Sanjay Jha, whose spouse carries an LG Voyager and refuses to trade it for a Moto. Mrs. Steve Jobs? She carries an iPhone. The company is cutting back from six operating systems to three: Windows Mobile, Moto's own P2K, and Google's open-source Android. Oh, and they're going to lay off a few thousand more people, too. Tough times, tough decisions!
Where's the debt crisis in Silicon Valley? The knock-on effects are all too real, but frozen credit markets have had little direct effect on business operations, aside from possibly scotching the debt-fueled sales of Alltel and Nextel. That's because technology companies are run by paranoid sorts who like to keep large cash reserves, in case some upstart renders their market obsolete. In good times, activist shareholders whinged about their parsimonious habits, but the cash hoarders are now sitting pretty — and could be set for acquisition binges.One company which listened, to its detriment, to shareholders was Microsoft. When Bill Gates ran the software company, he liked to keep a year's worth of expenses on hand, in case things went awry. Microsoft is no longer quite so stingy with its cash; it dribbles some out in dividends, and gave shareholders a $32 billion payout a few years back. Good thing it didn't shell out $44 billion for Yahoo; that deal would have left it cash-poor and debt-ridden, at exactly the wrong time. Even so, Microsoft's balance sheet is no longer the most sterling in tech. So who's got cash on hand? Here are the 10 richest tech companies, from a Yahoo Finance screening. (I left out companies, like IBM, whose cash was matched by equally outsized debts.)
After a rocky iPhone 3G launch, Apple's store operations have returned to a model of efficiency. One of Steve Jobs's secrets: roving sales clerks who use mobile devices to ring up orders anywhere in the store, not just at the cash register. Ah, but which devices? Motorola MC75 handhelds running Microsoft's Windows Mobile operating system.
Sony, Samsung, Motorola and Hitachi have banded together to adopt Amimon's ready-and-shipping wireless HDTV chips for next year's products. Because the products will have no cable jacks, the new gear will sport a conspicuous logo that indicates it will connect to other devices with the same logo. If you want to play pundit, predict a format war between Amimon's WHDI and SiBeam's WirelessHD, which other manufacturers are tinkering with. But if you want to know who will win, Amimon's technology is already shipping and SiBeam's isn't.
Motorola has sued Mike Fenger, the former head of Motorola's mobile gadgets for Europe, Africa and the Middle East. Fenger allegedly broke a two-year noncompete agreement by jumping to Apple to run global sales for the's iPhone in March. “He cannot perform his duties for Apple without inevitably disclosing Motorola’s trade secrets,” says the lawsuit, which aims to keep Fenger away from Apple and other mobile makers for two years. Trade secrets? Here's a more honest appraisal: If Fenger did so well selling the Moto Q, imagine what he'll do given an iPhone.
In explaining Carl Icahn's raid on Yahoo, pundits bring up his efforts to shake up tech and media giants like Motorola and Time Warner. But I think there's a better analogy in Icahn's past: TWA. Icahn's attempt to gain a board seat or broker a new deal to sell Yahoo to Microsoft will not send Yahoo soaring; if left unchecked, he will run Yahoo into the ground as surely as he did that troubled airline. Icahn's bid, and the support it is drawing from large Yahoo investors, seems premised on the notion that he can bring Microsoft and Yahoo back to the bargaining table. That seems unlikely.
Motorola, mortally wounded, is spinning off its handset business in slow motion. CEO Greg Brown expects the deal to go through next year. There's no Razr on the horizon to spur sales, thanks to former CEO Ed Zander's overreliance on the model. In San Francisco cofeeshops, the popular theory is that Apple's iPhone killed Motorola. Nonsense. Motorola killed Motorola. The population of the Bay Area is 7.2 million; despite the appearance that every man, woman, and child here now has an iPhone, Apple will be lucky to have sold that many by now.
Investor Carl Icahn has sued Motorola to force the company to release internal documents about its cell-phone handset business. Icahn is pursuing a proxy fight to install new directors on Motorola's board and force the company to spin off or sell its handset business. Motorola calls the lawsuit a "distraction." [FT]
Blackberry maker Research In Motion (RIM) filed suit against Motorola on February 16, claiming Motorola overcharges for licenses to use its patented technology. RIM calls these technologies "industry standards" unworthy of patent protection. Motorola disagrees and filed its own patent-infringement suit against RIM. [WSJ]
What's Motorola minus the cell phones? One might as well speak of Ford without the cars, or Starbucks without the coffee. That unfathomable equation is on the drawing board, apparently, as the company faces pressure to improve its performance. The Wall Street Journal reports that Motorola is considering selling or spinning off the troubled division, which accounts for half the company's sales. But selling the company's cell-phone division makes no gut sense. It would, by itself, do nothing to improve the company's sales of handsets. And it would be crushing to the company's identity. Did you know Motorola also makes set-top boxes, walkie-talkies, and networking gear? Exactly.
Motorola stock has fallen to a four-year low after a bad earnings report yesterday. The company reported earnings of 4 cents a share on $9.65 billion in sales. The profit numbers were an 84 percent drop year over year. Additionally, Motorola's market share in mobile handsets continues to decline, down to 13 percent globally. For fiscal 2007, Motorola lost $49 million compared to a $3.67 billion profit in 2006. Ouch. The largest drop came from the handset division, which reported an operating loss of $388 million. Motorola execs say a new line of "innovative" cell phone will jumpstart earnings. Unless MOT comes up with another hit phone, like the RAZR, we find that hard to believe.
