Forget a Spinoff: Motorola Should Sell Its Handset Business

Watching Motorola’s handset business disintegrate is difficult even for those of us who don’t have a tangible stake in the company.

While some optimists retain hope for a comeback in 2009, I don’t see it. The same bunch of reputed leaders that has steered Motorola’s handset ship into the mangroves cannot be expected to suddenly acquire navigational prowess and strategic brilliance. That would be asking for a reversal of established form, and that rarely happens in the absence of a miracle.

Nobody likes where Motorola’s handset group is heading for the remainder of 2008, and plans for a spinoff seem misguided. Motorola should just sell the handset unit to somebody that has a real plan for reviving it. That won’t be easy for anybody, not with low-cost Asian handset vendors relentlessly gutting margins at the low end while Apple and RIM redraw the boundaries of the smartphone market up above.

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