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Is Motorola putting lipstick on a pig?

added by Michael on 26 Mar 2008

That's the question the c|net blog over at news.com is asking about today's announcement that Motorolla is going to split into two companies: one for its "mobile-devices business" and the other for its "broadband and mobility-solutions business"

Motorola said Wednesday it plans to split off its handset business, but the move might just be a last attempt to pretty up the failing business unit to make it more attractive to potential buyers.

Since Motorola said in January that it was considering "options" for its handset business, there's been speculation that the company was preparing to sell it to a third party.

But word on the Street is that the company couldn't find a buyer. After all, Motorola is trying to unload the business for a reason. The company currently has no hit products, and its market share has been declining rapidly. Besides, potential buyers may look at what happened to BenQ when it bought Siemens' handset business in 2005. A year later, BenQ Mobile, which had been set up to handle the brand business, went bankrupt and with it went the rest of Siemens' handset division.

So what's the best way to move merchandise when it isn't selling? You could lower the price. Or you could pretty up and repackage what you've got. That might be just what Motorola is trying to do. It reminds me of those HGTV shows that tell you what you need to do to sell your house. The first thing they tell people is to remove all the excess crap they have lying around the house, pictures, kids' toys, anything that could distract a potential buyer.