Rise of the machine-to-machines

Motorola is turning to the consumer electronics market as it looks to expand its troubled wireless business in new directions.

On Tuesday morning, the company will announce plans to sell wireless broadband modules that device makers can use to put into consumer electronics products or monitoring devices to provide broadband wireless connectivity.

Specifically, Motorola is putting its homegrown wireless technology into embedded modules so that laptops, netbooks, digital cameras, and other devices can connect to the internet using 3G HSPA networks, as well as 4G wireless networks using WiMax and LTE technologies.

Motorola's entree into this market is significant because it marks the first time the mobile phone maker has sold its wireless technology to other device manufacturers. Up to this point, Motorola has kept its wireless technology for its own products.

But Motorola executives say they see a big opportunity in the consumer electronics and machine-to-machine markets. And right now as Motorola struggles to get back on track, the company could use a new market opportunity to add some extra revenue.

"We see wireless broadband in consumer electronics being a tremendous growth opportunity not just for Motorola, but for the entire industry," said Gary Koerper, VP of Engine Systems for Motorola Mobile Devices. "In the next five to seven years everything you own will be connected to the internet."

No hit since Razr
Motorola's wireless business has been faltering for more than two years. The company hasn't had a hit handset since the 2004 introduction of the Razr and it's steadily been losing market share to competitors, such as Nokia and Samsung. In an effort to revive the failing business, the company ousted its CEO and announced a plan to spin off the handset business.

The company hired Sanjay Jha as a new CEO for the division to steer it back to recovery. But the plan for the spin-off was shelved when the economy tanked. Since then, the company has announced a new plan, which involves cutting back the number of operating systems it uses for its devices and standardising on only a few operating systems, such Google's Android platform. But so far the fruits of these plans haven't been seen.

Meanwhile, competition is heating up amid its traditional mobile phone competitors and newcomers, such as Apple with its iPhone and Research in Motion with the BlackBerry, have posed a threat to the company at the high-end with stronger sales in smartphones. This competitive pressure appears to have spurred Motorola to look to other markets to supplement its shrinking wireless revenue.

But Koerper also said that Motorola is not giving up on its plans to revive its handset business.

"The core of Motorola's wireless devices business is still cell phones," he said. "We are still focused on smartphones and Android handsets to drive that market going forward."

Koerper pointed to the emerging netbook market and smart grid market as examples of where Motorola's technology could be useful.

Koerper believes these two markets offer a major opportunity for Motorola because the company has already been developing the 3G and 4G technology necessary to connect these devices to a wireless broadband network for its own wireless products.

"I think it's the culmination of our quiet...

Click here to read page two of this article