Motorola may be the first of many to leave the handset biz

Here’s a prediction. Open networks, open source software and surplus Chinese manufacturing capacity from the economic slowdown will commoditize handset business very quickly. Facing increased competition, and investor pressure, Moto may be exiting the business. I think they are also acutely aware of the coming market changes.

The company, which practically invented the cell phone market in the ’80s, is considering spinning off its beleaguered handset business in an effort to revive the business, Motorola said Thursday.

In a press release, the company said it was considering a “structural realignment” to kick-start its mobile-device business, which has seen its global market share plunge to 12 percent from more than 20 percent market share a year ago. The main problem has been Motorola’s inability to come up with new handsets to follow the once highly popular Razr.

Last week, the company told investors it would take longer than expected to turn around its troubled cell phone business. And it warned that revenue and market share would likely decline further in the first quarter. (from Cnet)