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Motorola Exits Stage Left

After building the best-known brand in the RFID market and positioning itself as the gorilla, Motorola sells its RFID business to Zebra Technologies.
By Mark Roberti
Apr 21, 2014

The first thing I thought of when I received Motorola's press release announcing it had sold its enterprise division, which includes its radio frequency identification business, to Zebra Technologies (see Zebra Buys Motorola Solutions' Enterprise Business), was Paul Saffo's presentation at RFID Journal LIVE! 2005. Saffo, a renowned futurist, gives advice to the likes of Bill Gates regarding where technology is going. At our event, he explained the hype cycle and said it takes time for a new technology to mature. "As a result, many of you vendors in the audience," he predicted, "will exit the market just as it is about to take off" (see Futurist Paul Saffo Discusses the Adoption of RFID Technology at RFID Journal LIVE! 2005).

I believe Motorola is making a huge mistake. I recognize that the company conducted a strategic review and found that its enterprise division, which sells mostly bar-code and RFID equipment, did not gel with its government division, which sells communications equipment to first responders, police forces and the like. That is a reasonable decision—though one wonders why the previous CEO, who purchased Symbol Technologies in 2006 (see Motorola Acquiring Symbol), didn't see that logic.

The leaders of Motorola's enterprise division understand RFID's potential and the revenue it will generate. It appears, however, that the higher-ups didn't see the potential. It's hard to imagine that any company would sell a division that is about to see enormous growth, regardless of the fit. Every publicly traded company wants to see an engine for rapid and sustained profits.

I'm sure the folks who engineered the deal would say that people like me have been claiming RFID is about to take off for years. That's true. And it might still be a few more years before sales of Motorola—I mean, uh, Zebra—readers explode. But explode they will. Going back to Paul's Saffo's presentation, he also said: "Everyone overestimates the short-term potential of a new technology and underestimates the long-term potential." He pointed out that in the early 1980s, IBM estimated the total market for personal computers to be about 60,000 units annually. PC sales peaked at 95 million during the fourth quarter of 2011.

Motorola's loss is, of course, Zebra's gain. The challenge for Zebra, if the deal closes, is to let the world know that Motorola handheld and fixed readers are now Zebra readers. Motorola built the best-known brand in the industry after it purchased Symbol. Zebra can't assume that just because it purchased Motorola's business, everyone will know that and flock to Zebra for readers. It needs to establish in the RFID technology buyer's mind that Zebra is now the go-to company for fixed and handheld readers, the way Motorola did.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.

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