Motorola Expects Government IT Business to Grow
The first step in Motorola's planned split occurred July 19, when Nokia Siemens Network announced it was buying Motorola's telecommunications equipment business for $1.2 billion.
The next step will happen in early 2011, when the rest of the company splits in two, with one company comprising Motorola's mobile devices and television set-top boxes, and the other its enterprise mobility and public safety units.
Motorola's handheld device business tends to get the lion's share of headlines for the company, particularly with its growing line of Android-based mobile phones such as the Droid X.
However, the business unit in charge of government, public safety and enterprise solutions is a bigger contributor to Motorola's bottom line. The Enterprise Mobility Solutions unit generated $1.7 billion in the company's fiscal first quarter, compared with $1.6 billion from the Mobile Devices business.
And company officials expect that the enterprise business will only grow, particularly when it comes to offerings for governmental agencies and public safety groups, whose officials are looking for solutions that will enable them to work more efficiently, increase productivity, reduce costs and attract business to their areas.
The public sector IT space is a large one. Motorola, quoting IDC, said the spending in North America alone in this market is about $58 billion.
From video surveillance to e-ticketing and video surveillance products to mobile and mission-critical radio solutions, governmental agencies increasingly are turning to mobile solutions in difficult economic times, according to Scott French, vice president of wireless mobility solutions for Motorola.
The company is seeing that growing interest not only in the number of government agencies Motorola representatives are talking with, but also in who at these agencies they are talking to.
"We're increasingly spending more time with government CIOs" rather than with people who work for the CIO, French said in a recent interview with eWEEK, well before the sale of the telecommunications equipment business to Nokia Siemens was announced.
The message Motorola officials are taking to CIOs across the country is that by investing in mobile technologies now they can save money down the road.
E-ticketing is an example, French said. It currently takes a police officer 5 to 6 minutes to generate a traffic ticket, and a significant number of those tickets are lost in the mail, are lost by the driver or are flawed in some way, such as errors in the data being entered, he said.
With an e-ticketing solution, traffic tickets can be generated in less than a minute, giving the police officer more time for the rest of the job, French said. In addition, the process is a more efficient one, with fewer errors and less chance of information being lost.
The Los Angeles Police Department was able to save an estimated 15 percent on costs thanks to e-ticketing technology, he said.
There are countless ways that governments can use mobile technology, French said. Towns can put RFID (radio-frequency identification) tags on snow plows to keep track of them, cities can use video surveillance to help battle crime, schools are using wireless solutions for e-learning environments, and first responders can use handheld radio solutions to receive real-time information and enhance communications across various agencies.
For example, fire and rescue departments in Northern Virginia are using the HC Patient Tracking System from Global Emergency Resources on MC75 handheld computers from Motorola to track communications and help with patient triage.
Governments also are showing greater interest in public-private partnerships, French said. He spoke about work Motorola has done with officials in Chattanooga, Tenn., where wireless surveillance technology was used in the city's waterfront area to keep residents safer, and in another instance, a wireless camera was set up as part of a pitch to entice Volkswagen to put a manufacturing plant in the city.
In their first-quarter earnings announcement in April, Motorola officials also pointed out several other wins, including getting a number of multimillion dollar deals with cities in North America, and three statewide wins, including in Michigan and Wyoming.
Motorola also announced new rugged digital barcode scanners for harsh industrial environments, and the first cordless digital imager for health care environments.
French said he expects the momentum to continue, particularly as local, state and federal governmental agencies begin to recover from the recession. He said government procurement rules are relaxing a bit, making it easier for agencies to purchase the technology they use.
In addition, wireless operators such as AT&T and Verizon Wireless are expanding next-generation LTE (Long Term Evolution) networks, opening up opportunities for companies like Motorola to sell their products.