As new Motorola boss Greg Brown figures out what to do with his slacking mobile phone business — the company is considering a spinoff or sale — the Wall St. Journal reports that Brown is also considering spinning off his wireless network gear unit into a joint venture with Nortel (NT). The combined companies would have revenue around $10 billion.
This deal makes lots of sense. As Motorola/Nortel’s customers — wireless carriers — have consolidated in recent years, MOT, NT and their competitors have been bidding on fewer, bigger deals. That’s the logic behind earlier deals like Alcatel-Lucent and a JV between Nokia and Siemens. Combined, Motorola and Nortel would have more bargaining power than they do now.
Nortel CEO Mike Zafirovski knows both companies well, and could lead the JV. He was Motorola’s No. 2 exec but left the company when he was passed up for the CEO spot in favour of Ed Zander. Since then, he’s been trying to turn things around at Nortel, which was rocked by a massive accounting scandal in 2004.
Meanwhile, Motorola has been showing off a few new products at the Mobile World Congress (3GSM) trade show in Barcelona, like its new mobile TV/navigation device, some new mobile phones, and a series of devices called “femtocells,” which let people boost the mobile phone signals in their homes via a device that plugs into their home, broadband Internet connection.
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