Motorola, Inc.

U.S. manufacturer of wireless communications, electronic systems, and semiconductors.

The company, headquartered in Schaumburg, Ill., was founded in 1928 in Chicago by brothers Paul and Joseph Galvin as the Galvin Manufacturing Corp. In 1930 the company began selling a low-cost automobile radio, called the Motorola. In 1947 the company changed its name to Motorola, and the next year it introduced a television set. Motorola licensed the design for transistors from Bell Laboratories in 1952 and began to sell them to other manufacturers in 1956. By 1962 the company had more than 4,000 different electronic components on the market. In 1974 Motorola released its first microprocessor for sale to computer makers. In 1993 the company developed the first consumer RISC (reduced-instruction-set computing) chip, the PowerPC, with IBM Corp. and Apple Computer, Inc. In the market for embedded microprocessors

ubiquitous in such common items as kitchen appliances, pagers, video games, and handheld personal computers

Motorola became the leading manufacturer. Motorola was also a leader in the development of cellular telephone systems. In 1989 the company introduced the MicroTAC flip phone, which quickly became an international status symbol.

* * *

▪ American company

Introduction

      American manufacturer of wireless communications and electronic systems. Its headquarters are located in Schaumburg, Ill.

Founding as Galvin Manufacturing

 The company was founded in 1928 in Chicago by brothers Paul and Joseph Galvin as the Galvin Manufacturing Corporation. Its first product was the “battery eliminator,” a device that connected direct-current (direct current), battery-powered radios (radio) to the alternating current then found in almost two-thirds of U.S. households. In 1930 the company began selling a low-cost automobile radio, called the Motorola, that became the most popular new-car option, as well as a successful aftermarket kit. In 1937 the company diversified into home tabletop radios and introduced the first car radio to offer push-button dialing.

      During the Great Depression, Galvin Manufacturing cut its workforce by two-thirds and saw its revenues drop by more than one-third. To sustain the company during the later years of the Depression, the Galvin brothers, who opposed unions, took on work from other companies, such as the Philco Corporation in 1938, whose workers were on strike. In defense of these actions, the Galvins claimed that their starting wage of 40 to 60 cents per hour surpassed the industry average of 25 to 35 cents per hour.

      In 1940 the company introduced a pair of two-way radio communications products for the police and military. The first was an AM-band police radio system adopted later that year in Bowling Green, Ky.; the second was the Handie-Talkie, an AM-band, handheld device with a long antenna that ultimately was used by soldiers during World War II. Both AM-based systems were quickly superseded by FM technologies. The most notable replacement occurred in 1943, when Galvin Manufacturing invented the FM Walkie-Talkie. This device was carried by battlefield soldiers in special backpacks and could communicate over longer distances and with far less static interference than its AM-based predecessor. The two-way radio saw action on all fronts during the war and is credited as being a decisive factor in many Allied victories in the field.

Motorola product diversification

      In 1943 the company sold stock to the public for the first time, and in 1947 it changed its name to Motorola, Inc., which was by then a well-known brand name. The next year Motorola extended its role in the U.S. consumer market by introducing the first television set for under $200, the Golden View. Its seven-inch round picture tube helped Motorola to secure 10 percent of the U.S. television market by 1954. In 1953 the company, like other television makers, created its own program, the Motorola TV Hour, to boost interest in the new medium. Robert Galvin, Paul Galvin's son and a vice president of the company, hosted the weekly drama series. Motorola's consumer product line branched into high-fidelity phonographs in the mid-1950s.

 After licensing the design for transistors (transistor) from Bell Laboratories in 1952, Motorola began experimenting with them to replace its large, heavy, and expensive radio power supplies. By 1956 the company began to sell hybrid radios with both vacuum tubes (electron tube) and transistors—its first successful foray into electronic products. That same year the company began to sell its transistors to other manufacturers and established its Semiconductor Products Division in Phoenix, Ariz. By 1962 the company had more than 4,000 different electronic components on the market. One of the largest early markets was for automobiles, whose manufacturers used electronic components to build alternators, which replaced generators in most cars sold in the 1960s. Together with the Ford Motor Company and the Radio Corporation of America (RCA Corporation) (RCA), Motorola developed the eight-track tape player for cars in 1965.

Marketing redirection

      Robert Galvin became president of the company in 1956. Despite Motorola's ongoing success and strong brand recognition in consumer products, he shifted the company's strategy toward selling directly to business and government. In 1962 Motorola began supplying radio communications gear to the unmanned Mariner and later to the manned Gemini space programs. Apollo (Apollo program) astronaut Neil Armstrong (Armstrong, Neil)'s 1969 message from the Moon was carried over a Motorola-designed transponder.

      In 1974 the company sold its Quasar television line to Matsushita Electrical Industrial Co., Ltd., of Japan, ending most of its historic consumer business. That same year Motorola released its first microprocessor for sale to computer makers. Its most popular computer chips, the MC680x0 series, were used in all of the early Apple (Apple Inc.) Macintosh computers and in workstation computers built by Sun Microsystems, Inc., and Silicon Graphics, Inc. (SGI), throughout the 1980s and early '90s. In 1993 the company developed the first consumer RISC (reduced-instruction-set computing) chip, the PowerPC, with IBM Corporation (International Business Machines Corporation) and Apple Computer, Inc. (now Apple Inc.), in an unsuccessful attempt to unseat Intel Corporation as the leading seller of microprocessors.

      Motorola was more successful in the market for embedded (embedded processor) microprocessors, which became ubiquitous in automotive control units, industrial control systems, and such common items as kitchen appliances, pagers, electronic game systems, routers, laser printers, and handheld personal digital assistants (PDAs). In this market Motorola became the leading manufacturer.

Consumer telecommunications business

      In 1977 Motorola developed a handheld wireless telephone that was able to communicate with the public telephone network through a system of short-range “cells.” By 1985 most major cities in the world were installing cellular systems, and in 1989 the company introduced the MicroTAC flip cellular phone, which quickly became an international status symbol as well as a useful personal communications device. The overwhelming success of cellular telephony inspired the development of Iridium, a system of 66 small satellites deployed in low-Earth orbit that enabled communications over virtually the entire surface of the Earth. Operational in 1998, Iridium linked existing terrestrial communications systems, including faxes, pagers, computers, and telephones.

      The service proved too expensive, however, and Motorola divested itself of its interest in Iridium to limit its liability. Losses associated with creating the service and growing competition with other cellular telephone manufacturers created a cash-flow problem that induced the company to begin spinning off various components: its Semiconductor Components Group was sold to a private equity group as On Semiconductor in 1999; its Integrated Information Systems group (which built systems for government and defense contractors) was sold to the General Dynamics Corporation (General Dynamics Corp.) in 2001; its Semiconductor Products Sector (which built the company's semiconductors, including the PowerPC) was reorganized as the independent corporation Freescale Semiconductor, Inc., in 2004; and its Embedded Communications Group (which provided services and products to manufacturers in defense, aerospace, telecommunications, medical imaging, and industrial automation) was sold to the Emerson Electric Co., in 2007.

      Although sales of its semiconductor-based businesses and the introduction of the well-received RAZR V3 cellular telephone in 2004 improved the company's bottom line, Motorola continued to lose money and market share to rival cellular telephone manufacturers. In 2008 Motorola announced plans to split into two independent companies: Motorola Mobile Devices, containing its cellular telephone component, and Motorola Broadband & Mobility Solutions, containing its enterprise, business, and home networking component.

Mark Hall

* * *