The business stories that matter, by Fortune's Colin Barr
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January 31, 2008, 5:03 pm

Motorola takes Icahn’s split-up advice

Motorola (MOT) cried uncle. The struggling cell phone maker said after trading closed Thursday that it might have to separate its money-losing mobile devices business from the profitable networks businesses - just as activist investor Carl Icahn has been demanding. The move comes just a week after the company said the handset unit “remains challenged,” to the tune of a 38% drop in fourth-quarter sales. “The recovery in Mobile Devices will take longer than expected and there is a lot more work to be done,” new CEO Greg Brown said back on Jan. 23. Now, it seems that some of the work involves shopping the unit for a sale or perhaps trying to arrange a possible spinoff. Beyond the typical corporatespeak, Motorola remains vague about what exactly might be done, or why. “The company’s alternatives may include the separation of Mobile Devices from its other businesses,” Motorola said, “in order to permit each business to grow and better serve its customers.” Of course, the customer - as former chief Ed Zander learned the hard way - is always right.

The above poster is exactly correct. Motorola has the engineering talent and investors. Motorola lacks technical leadership that will stand up to the business leadership and drive innovation. Really bad for investors, employees, and consumers.

Posted By AnotherInsider SoFlo : February 4, 2008 9:05 am

Motorola problems are entirely internal — disconnected organizations, leadership that cannot lead, arrogance on creating their own software platforms (oh, sure…lets reinvent the the wheel..), and leaders that would rather follow Ichan than have some balls and drive a strategy.

What they need to to hire a few senior level ball-busters that will actually lead - unfortuneately, that is very difficult thing to do in a large corporattion.

Too bad for employees. Too bad for investors.

Posted By Insider, Chicago, IL : January 31, 2008 5:40 pm
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Colin Barr covers business and finance for Fortune.com. Previously he was an editor at TheStreet.com and author of the weekly Five Dumbest Things on Wall Street column, and an editor at Dow Jones Newswires.
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