What happened to Motorola
chicagomag.com
chicagomag.com
I worked in like '04-'08 building third party mobile software for a large variety of manufacturers and devices. Remember, this was pre-iphone, so there was a big business in building component X for device Y on platform Z.
In my experience of device manufacturers:
Nokia was insanely arrogant; the google of its day. Sony Ericsson were quite good, it showed that they wanted to build a quality experience.
The Japanese manufacturers were absolutely insane. They would routinely produce P1 bug reports in the style of "we opened the X application repetatively. On the 1154th time it crashed on start-up. Sometimes."
We had a few projects with Motorola together with US carriers. They were total nightmares - the Motorola engineers seemed like they had been picked up from the streets of Hyderabad the day before. (This is not a racial prejudice: most of the Indian engineers I've come across in the industry have actually been remarkably talented. This is not valid for the Motorola engineers though.) Most of these device projects were very high profile in the US, and presumably important for Motorola; yet they couldn't or wouldn't muster better staffing.
The streets of Hyderabad, eh? I can only imagine, having been there about 2 years ago. The level of construction and build-out is amazing. Where are all of the "trained" workers going to come from?
That the internal competitions eventually led to internal war between different "tribes" doesn't totally surprise me. It seems you always read about that eventually happening in the post-mortem of any company with that type of structure. I wonder if there's a good way to balance internal competition. I imagine you would have to keep close watch on the overall silo-ing of each department.
I'm from the Chicago area, and I remember driving by their campus many times over the years as a kid, only really having an idea that they were somehow involved in phones. I was in high school when the Razr came out, and based on how popular it was I thought Motorola was an absolutely world-dominating company, not a business on the rebound from extremely heady heights.
And all the devices took a different power adapter, and different battery.
I had heard crazy stories back then, for example how the handset division (PCS) had to reverse-engineer Motorola Semiconductor products after buying a phone on the street in Hong Kong because they could not get the specs internally.
The whole idea of Motorola competing with itself sounded as crazy to us then as it does now.
Motorola was way too silo'ed and metrics driven, with a ruthless focus on efficiency, that was often short sighted. I guess no one there read the Innovators Dilemma.
In the early 2000s, Nokia's management team often referred to the book. CEO Jorma Ollila has said that he tried to build a corporation that would avoid the traps described in the book. Yet when we look back now, it seems obvious that Nokia was coasting on increasing profit margins and incremental innovation to drive its featurephone and Symbian smartphone lines.
How did that happen? My impression is that Nokia misjudged their market position. They saw themselves as the upstart innovator as compared to traditional PC vendors.
Just before the iPhone was unveiled, Nokia introduced the N95 smartphone with the tag line "This is what computers have become." In Nokia's eyes, their phones were going to disrupt computers in a few years. But they were beaten by Apple's better vision of what the disruptive mobile computer should look like, and they never recovered from that punch.
In 2003 PCS China developed a Linux-powered touch-screen phone that ran Java (J2ME) apps, the A760. A clear predecessor to Android.
It never launched outside of Asia because it wasn't developed in the USA, and wasn't the razr.
Nobody thought an 800-lb gorilla like Nokia could ever be unseated. Looking back, it's still boggling that the collapse took a mere seven years.
The iPhone 1 was just a glorified iPod without 3rd party apps, it excited mostly Mac users, not obviously something to "drop everything" over. Even now iPhone has less than 15% market share. Android was arguably a more obvious threat.
I still believe any ceo of a cell phone manufacturer who got one (and they all should have purchased an iphone on the first day) and didn't immediately see the future unfolding in front of them is incompetent.
For starters, we'd had PDAs with touch screens for years, and they were hot in the business market for a while, but remained a niche product. Even when they got built in phones.
We'd had tablets since at least '99 (I worked on the software for one in '99 and we were certainly not first), and they'd remained a niche - either underpowered or overpriced (the latter typically being pretty much laptops with a swivel display).
When we tried to build interest from partners in our tablet in '99, it quickly became clear the market was not at all ready. People didn't understand why they'd need or want a product like that. Ericssons "Screen Phone" suffered the same fate, and quietly disappeared. (Though both the tablet I worked on, and the Ericsson Screen Phone were limited severely by being tied to ISDN base stations rather than truly mobile).
And it stayed like that for several years.
If you'd played with that stuff, the iPhone looked like an evolutionary step of a niche product.
If you were intimately involved with these markets at the time, it'd be easy to assume that the tepid response was still going to be the case when the iPhone arrived, and that at least you'd have plenty of time to see how the market was maturing before needing to respond. Let someone else make the expensive market lessons for you.
It's one of those cases where being too close to the technology was a disadvantage for many, because it meant not so easily seeing that this was the evolutionary step that finally would tip things over into creating excitement amongst regular people.
Having an app store on the device probably helped as well, as you could easily add little features that mattered to you with much less hassle than a Palm Pilot.
I loved my Palm Pilots, but iOS (and Android) killed 'em dead.
For my part, I was not at all interested in the iPhone: The keyboard was useless to me. I have big hands. The error rate I get with the iPhone keyboard made my (long discarded by then) Palm Pilot seem like the futuristic sci fi device. It wasn't until I tried one of the keyboard replacements for Android, on a bigger device, that I started preferring an on-screen keyboard.
Today I'm happily using SwiftKey on a 5.6" Android phone, so I'm back to swiping, though whole words rather than character by character, and I'd not rule out going to 6" next time. Going to an on screen keyboard felt like a massive step down after I'd tested friends iPhones. And a touch screen that didn't work with a stylus (without a massive tip) felt like a big step backwards.
The iPhone was obviously superior to dumb feature phones when it came. But lots of people in the industry had not had dumb feature phones for several years by then, and had learned to cope with (work around) or even like the things that the iPhone solved. That easily makes you blind for how other people will take to it.
In Nokia's mindset, especially on a continent where people paid full price for phones and didn't get subsidies from the carriers like US users, web enabled smartphones were a high-end luxury or business item. The cash was still in the meaty part of the curve, selling candybars and semi-feature phones to economy users and the 2nd-3rd world.
Perhaps the iPhone wouldn't have been as big an initial smash if everyone had to pay $800-$1200 out of the gate.
I guess Nokia didn't figure on Google managing to fit an iPhone-like interface on commodity hardware.
However, the N96 (Feb 2008) was a poor product, hard to read email on, browse the web and tons of bugs in basic features, with basically no software updates in all the time it was out. All of this on a product cost much the same as the iPhone. I wrote about this a while back: https://rythie.com/blog/blog/2009/09/17/dont-buy-a-nokia-n96...
They didn't see (nor did many) that the highend/smartphone market, would basically be the entire market. They needed to double down on N95/N96 and highend phone quality, but they were all over the place trying to make 100s of different phones.
I kinda suspect that companies in this position are damned if they do and damned if they don't. If they foster internal competition, then the place becomes overly political, nobody cooperates, it becomes miserable to work there, and all the good people leave. If they don't, then there's no sense of urgency, everybody goes off and does their own pet project, people waste time on silly stuff, folks who pay attention to external customer needs can't get the necessary internal buy-in, and all the good people leave.
Eventually competition springs up externally, but by then the organization may have ossified so much that it's incapable of responding to it.
My guess is that Google is still much too young a company to esperience any of the issues. Maybe once the founders are out for good, and we see more tradtional MBA-style leadership, the traditional illnesses will start emerging too.
Up to now Google has avoided the problem by consistently biting off more than it can chew, landing some borderline-success and improving on from there. This is what they did with search, advertising, book digitalization, online videos, etc. In short, there wasn't much need for internal competition, since they were actively looking for new challenges from the outside.
It's great that they're doing all of this, but I'm curious whether at some point (a few decades from now) they'll eventually decide that all the effort isn't really worth it and focus only on the high-margin stuff.
I'd expect the best people to leave soon or have left already (we already see a lot less enthusiasm about working there than there used to be), and Google to decline like any other big company.
Google Fiber, the Internet on hot air balloons and driverless cars are all fairly innovative projects with no known competitors. There's also the secret project that Andy Rubin's team is working on and who knows what else we don't know about brewing at GoogleX.
The Hot Air Balloons are a bit of a gimmick, but definitely innovative and new as is the driverless car project which could have tremendous impact on transportation of the future.
Google Search languished for many years (roughly 2004-2009) while Google invented all these other products. Then Bing launched in 2009, and there was a period of rapid innovation from 2009-2011 that gave us Search Options, one unified search across all corpora, 2 visual redesigns, realtime search, Instant, Authorship, Search Plus Your World, and Knowledge/Answer Cards. Then things slowed down again in 2012 when everyone realized Bing was a joke. I personally witnessed - to both my benefit and my detriment - both extremes I mentioned in my original post.
It seems clarity of focus and mission counts for a lot. When I look at a company like Sears, I don't get the sense of focus I get from a company like Apple.
It's surprising how little clarity the rank-and-file of many businesses have around what they're actually doing. In the case of Sears, are they trying to compete with Amazon? Or be a great local retailer? Or make great tools (Craftsman) and sell them directly and/or through channels?
Metrics are important but they aren't a substitute for vision and focus. When I see businesses driven from the very top levels of executive management strictly by metrics and numbers, I often wonder whether it's a symptom of a lack of focus and clarity from the folks at the top. Metrics are a great management tool, but they aren't good for setting direction, or leading.
When you are the only one making phones, internal struggle is good; when you are one of many, internal struggle makes you vulnerable.
One story that has stuck with me goes that there was a presentation pitching the business case for Iridium. One part of the presentation goes, cell phone usage is projected to rise by X by the time Iridium becomes operational, leaving the market of Y - X for Iridium. Another part of the presentation goes, cell phone usage has consistently outstripped expectations by a factor of four, therefore our upside is even greater than we might expect. Apparently not realizing that the two claims contradicted each other, and that if cell phones really were growing so fast, it would mean little would be left for Iridium, which is of course what happened.
But I can't remember where I saw it, and I can't dig it up now. Anyone happen to know if I'm remembering anything remotely close to reality, and where I might find info on it?
Whether or not that is true (and I would guess it's either not, or heavily exaggerated), either your story or mine does seem to drive home the misplaced optimism of the Iridium investors.
Speaking for myself, when I'm touring the US on a motorcycle I can make do with some lack of cell coverage. If I really cared that much, and needed emergency communication, I'd bring a handheld amateur radio with which I can just about always hit a repeater when a cell phone has no signal. If I were to absolutely, positively have to have some means of emergency comms, I'd go buy a SPOT for a lot less than Iridium. And if Iridium ever had a chance to at least be viable, SPOT seems to have put a nail in that coffin.
So the market we're left with is folks that have a need to vocally chatter to someone else no matter the circumstances. There are only so many war zone reporters and mountain climbers to go around, though.
The U.S. Department of Defense is Iridium's largest customer by far, and kept them alive with a large cash infusion at one point (if memory serves).
Also, fun fact: iridium modems provide the only continuous data link for the U.S. South Pole station. There are 12 modems ganged together, used for e-mail and weather info transfer. Bandwidth: 28.8kbps. (the station also has several high-bandwidth uplinks, but the coverage windows for those are limited, and they have to compete with NASA/ISS for bandwidth).
https://chrome.google.com/webstore/detail/global-satellite-m...
Plus no relatives to ever deal with again, til you retire.
I would've probably taken the offer, but as it stands, I probably lack the qualifications required.
For some reason, I thought Iridium was supposed to be marketed to "international business" crowd. Isn't that why they were charging $3k and expected people to call a hotline only to leave their contact information and have a follow-up phone call sometime during the next 7 business days? Or did Motorola believe that the market was moving from analog to satellite, as opposed to analog to digital?
If you haven't looked, it's actually quite reasonable now to rent an Iridium phone for a backcountry trip these days. If I was taking some boy scouts into the wild for long weekend, I'd definitely consider it in case of emergency.
The system was really a great piece of technology; MOT really let the engineers go at it. If it wasn't for the billing and provisioning, you could actually make an Iridium-to-Iridium call anywhere on the face of the earth in some sort of doomsday scenario, since all of the call routing goes between satellites—you don't need a ground station.
When I started at MOT, we were working on the broadband followup, Celestri, which turned into Teledesic. Same deal, anywhere on the globe, but around a 1-2Mbps connection, rather than Iridium's 0.002Mb data rate. It was a magnificent piece of engineering with hundreds of engineers working in a fancy new building with plans in place to double the building in a couple years as hundreds more engineers were coming on for the detailed design phases.
We were about 9 years from operation and had thousands of pages of architecture and design documents. I think the highest-level system design document was around 500 pages when it was shelved, but there were already some architecture documents running into the thousands of pages.
The projected launch costs alone were around $15B; that's not including actually building anything. It was the most expensive commercial project ever undertaken, though after Iridium's disappointing launch, even the most short-sighted executive could see that it was too big of a risk for any company to take.
Looking back, it was an amazing experience to be a part of a project that huge.
I got a slideshow of the Iridium deployment as part of a startup JV'd by Moto circa 1999. Iridium was one big ole project. Yep.
All this being said, Iridium lasted far longer than the startup.
What they got wrong was the deployment details, too much weight was put on providing service to places where nobody actually is, like 75% of the Earth's surface that's ocean. So they ended up with 66 satellites in a polar orbit.
A better idea is like the Thuraya model, put a couple satellites up in geosynchronous orbit (so you maintain coverage) and get a huge coverage cone.
http://www.thuraya.com/network-coverage
Today, with two birds, Thuraya covers 161 countries, pretty much all of Europe, most of Africa, all of Australia, and most of Asia and almost all of the coastal areas you're likely to find significant ship traffic in.
Even better, the phones are basically GSM phones and use SIM cards (they even look more or less like a normal cell phone and I believe you can use them for terrestrial service if you're within distance of a normal cell tower), you can get data service at 60kbps. Not blazing, but if you're stuck out in the middle of the Gobi and have a full battery you can check email and tweet. There's even sleeves you can get for smartphones to turn them into sat phones and indoor repeaters so you can use the phones indoors.
Two more satellites and they could provide something like 90% global landmass coverage.
Really the only people Iridium could ever have sold to would be the Navy. Which is basically what happened.
(apparently a next generation is being planned for 2015-2017 Falcon 9 launch series)
But surely it's not $5 billion annoying!
According to Wikipedia, as of 2012, service payments from governments accounted for only 23% of revenue.
McKinsey made a prediction that there would be about 900K mobiles sold in the US in 2000. They were off by 10s of millions or thousands of percent...
This link says it was made in the early 1980s but the prediction was later than that. http://www.samizdata.net/2007/06/fun-with-statis/
It seems amazing now but it was based on the idea that mobile phones would not appear in anything like the numbers they have. The idea that in places like Africa where getting a phone took 10 years that they would have hundreds of millions of cell phones would have been seen as pretty crazy in 1989.
Atari, Commodore, Sega, Apple, SNK, Sharp, Texas Instruments, Sun, and more all made significant systems with their chips.
Their i.MX series of application processors are in a lot of devices.
http://en.wikipedia.org/wiki/I.MX
The old 6800/68000 cores live on in the S08/S09 and Coldfire lines.
I just think it's a shame the 68k architecture didn't last at least into the Pentium age.
Really, it was just a problem of a maturing market. In the early days of any industry, many bespoke options can flourish. But as time passes and the market matures, power consolidates and there is no longer room for garage-companies.
I don't know for sure why Moto dropped it, but lifting from Wikipedia:
While the Motorola 68040 offered the same features as the Intel 80486 and could on a clock-for-clock basis significantly outperform the Intel chip, the 486 had the ability to be clocked significantly faster without suffering from overheating problems, especially the clock-doubled i486DX2 which ran the CPU logic at twice the external bus speed, giving such equipped IBM compatible systems a significant performance lead over their Macintosh equivalents
It has no memory protection though
[1]: http://rockbox.org and http://download.rockbox.org/daily/manual/rockbox-iriverh300....
I didn't succeed getting a newer gcc+newlib compiled for m68k, though.
All in all, the whole ecosystem around m68k seemed to have rotted away, also m68k support was also taken out of u-boot at some point if I remember correctly.
While it certainly would be possible to fix all of this, it's just too much effort "just for fun" with no particular gain besides "because I can":
If you actually have the need for some embedded CPU, one is much better off using whatever ARM core the majority of tinkerers is currently using, that way you are less likely to experience this bitrot.
The only thing that isn't great is Lenovo buying Motorola. I have a feeling this will mean we wont get many android updates in the future :(
Something the Chicago Magazine article doesn't really mention is the death of Geoffrey Frost in 2005. Frost spearheaded the RAZR's marketing and started to turn Moto's fortunes around in the early 2000s. After Frost passed, things went rudderless on the eve of the iPhone and Android.
http://archive.fortune.com/2006/05/31/magazines/fortune/razr...
"He also had spun an appealing narrative about how Motorola was cool again, and a myth about the slick downtown Chicago design studio where the phone had taken shape." (Which never existed)
> Motorola's phone O/Ses (yes, plural) were all very underpowered.
More on this: "What killed Motorola? Not Google! It was Moto's dire software" http://www.theregister.co.uk/2012/11/29/rockman_on_motorola/
Cramming a Java OS onto 2004 mobile hardware, very risky choice of a savior.
Half the interns used Treo, Sidekick, LG. Half had a Razr.
It just seems like all the Chicago technology greatness has melted outwards to the coasts. Silicon Valley and NYC (as well as foreign businesses) tend to dominate the areas that Motorola, Bell Labs, etc used to rule.
I didn't get a single callback of any sort from a company in the Midwest until 18 months after my graduation and it was to interview for a 1 year contract position at less than half what I was making at the job I accepted in Southern California. Nearly all my friends had similar situations, ending up on one of the coasts, or Austin.
"Motorola poured $2.6 billion and countless engineer hours into a $5 billion consortium to develop it. But once Iridium was finally operable in the late 1990s, its bulky $3,000 phones and $7-a-minute calls proved prohibitively expensive. Iridium declared bankruptcy in 1999 and sold off the bits for $25 million."
Because that was when the decline started.
Anyway, that is exactly what happened. We've transferred so much technology so quickly to China and India. The only hope for g the USA now is that standards of living rise in those counties enough that the wage gap isn't so bad, and more high tech can stay here.