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Motorola: communications power

by Loring Wirbel

It took the automobile radio to establish Motorola Inc.'s foothold in communications, and then it took 70 years for the company to become a wireless giant. Along the way the road has been bumpy.

On the one hand, Motorola's innovations over the years have led to an impressive stream of firsts, including automotive radio, handie-talkies, trunked radio, cellular radio, 32-bit microprocessors and low-earth-orbit cellular phone systems. But Motorola's mistimed marketing has meant that it has watched cellular subscriber, semiconductor and government communication markets slip from its grasp — at times with businesses the company appeared to own.

Motorola began life as Galvin Manufacturing Corp. in 1928, when Paul and Joseph Galvin acquired the assets of the bankrupt Stewart Storage Battery Co. The company's first practical automobile radio, which Galvin introduced in 1930, was called the Motorola. Like many companies, Galvin Manufacturing became so well-known by its principal product that the product name eventually became the corporate name — in 1940, in Motorola's case.

Chris Galvin, chairman and CEO, continues a tradition.


The communication division of the company was established on the eve of World War II with two markets in mind. Like many U.S. companies, Motorola devoted the bulk of its resources to the war effort in the early 1940s, and the drive to produce handie-talkies and walkie-talkies for the U.S. military led eventually to the formation of a government communications group in Arizona. That group was to play a critical role in Cold War defense communications and intelligence systems.

A second market with its roots in the early 1940s was the police and public safety market. Motorola pioneered AM public safety radio in 1941, then an FM version a year later that proved superior in range and performance. At the end of the 1940s Motorola introduced the more flexible dispatch radio concept, leading first to taxi and fleet-management radio systems and eventually to the specialized mobile radio of the latter part of the century.

Television development began in the late 1940s with a popular and small black and white unit, but Motorola could claim to be first with color television, in the early 1950s. Its initial offering was a flop, and it did not score a success until the transistorized Quasar units introduced in the mid-1960s. Meanwhile, the needs of both the government and consumer electronics sectors drove the establishment of a semiconductor development group at the company, which introduced its first power transistors in 1952. This group gained the status of a division in 1956.

Transistors served the broadcast radio groups within Motorola well. The first transistorized auto radio was introduced in 1956, and the popular X11 pocket radio, the type commonly referred to as a transistor radio, made its debut in 1959.

Although Motorola was commonly known in automotive markets only for its radios, the semiconductor division's turn to epitaxial wafer growth methods in the early 1960s led to a milestone in other automotive electronics. The epi wafers were used for silicon rectifiers that allowed the replacement of generators with cheaper and more reliable alternators. In some senses, that represented the first time that semiconductor groups within Motorola began driving product development.

In the boom years of the 1960s, Motorola relied on a mix of markets to spur its growth. Government and space electronics were an important part of the company's overall product mix. Motorola military radio and covert burst-communications radio became standard throughout Defense Department procurement, and Motorola transceivers were used in NASA programs ranging from Gemini to the Lunar rover of the later Apollo missions.

At the same time, Motorola's lead transistorized color TV and rectangular picture tubes helped revitalize the consumer electronics business. Newer businesses were tried, including eight-track tape players in 1965 and special pagers ,called Pageboys, introduced that same year and sold by AT&T to medical and professional markets as the Bellboy.

Like many of its semiconductor compatriots, Motorola spent the early part of the 1970s selling medium-scale-integration logic chips for the watch industry, until the 4,000-transistor 6800 microprocessor was introduced in mid-decade. While the 6800 was the core architecture for such common follow-ons as the 68HC11, it took several years of marketing in embedded markets for the company to receive the same degree of attention as competitors Texas Instruments Inc. and Intel Corp. At the end of the decade Motorola introduced the first 16-bit processor, the 68000, which became the basis for several successful 16- and 32-bit designs.

Meanwhile, the Illinois radio groups launched trunked radio in 1978 and began experimenting with cellular infrastructure systems at the end of the decade, though it would take until 1983 for the DynaTAC cellular system to be officially introduced. Motorola made its first forays into wireline data equipment in the 1970s, acquiring Codex Corp. in 1977 and UDS Inc. in 1978. Those acquisitions formed the basis for a strong serial-access corporate modem and ISDN business that survived through the 1990s, though the rate of innovation in Motorola's wireline data communications groups slowed considerably by the end of the century.

From the 1950s to the 1970s, Motorola had stayed solidly under Galvin management, with Robert Galvin rising first to chief executive and then to chairman. When the company passed to the management of George Fisher as president and Gary Tooker as chief operating officer in the 1980s, the uncertain market approaches began. Motorola expanded significantly to address new markets in that decade. It also failed to capitalize on several leads, though the inability to dominate some markets can be attributed to unique strengths of Japanese or European companies rather than to any inherent mistakes by Fisher and Tooker.

For example, in pagers Motorola solidified its lead by rolling out PageBoy II in 1983 and establishing a dedicated paging division in Boynton Beach, Fla., a year later. Like many players in the industry, Motorola failed to gain consumer attention for two-way pagers, though to this day it leads in consumer-oriented simple one-way pagers. In cellular radio systems, it moved from the bulky DynaTAC to the personal MicroTAC in the 1980s, but it also saw early leads eroded by the likes of Nokia, Ericsson and Siemens. Part of Motorola's problems in cellular had to do with European companies' ability to capitalize on a single digital standard, GSM, while their U.S. competitors worked with a patchwork of digital systems. But Motorola must share some blame for insisting that users stick with the analog Advanced Mobile Radio System long after competitors were pushing TDMA and CDMA digital systems.

A similar problem arose with semiconductors in the 1980s. As Motorola's market share in automotive control, power electronics and special government electronics continued to grow, by all rights its general-purpose microprocessor business should have done the same. The company claimed the first 32-bit processor, the 68020, in 1984; the first high-integration 32-bit CPU, the 68030, in 1987, and the first merchant RISC processor, the 88000, in 1987.

A design win for the 68020 at Apple Computer was seen as a boost in the mid-1980s. But because Apple elected to keep a closed operating system and motherboard strategy for the Macintosh (unlike the Intel-based IBM PC), Motorola was never able to capitalize on the volume sales that Intel could.

Motorola's semiconductor sector has faced a similar problem in digital signal processor architectures. The use of 56000-class products in Motorola cellular phones has been both a strength and a weakness for establishing the architecture. For several years in the 1980s and early 1990s, the architecture held its own against TI's TMS320, Analog Devices' 21xx and Lucent's 16000 families. But the failure of the floating-point 96000 DSP family in the early 1990s to establish a high-end market represented the watershed for Motorola's DSP success. Motorola merged its DSP program with Lucent's at the end of the decade, as part of the StarCore design deal.

At around the same time, the succession of Hector de la Ruiz to president of the semiconductor sector gave a new push to Motorola's consumer electronics focus. But Motorola's retrenchment in DSP and communications controller markets led to an exodus of talent at the end of the decade from which the semiconductor group is still struggling to recover. Similar uncertainties have faced the personal communications and government electronics groups. For example, Motorola was one of several companies that tried to prematurely address a personal digital assistant market, creating a special group under former Apple executive Randy Battat and launching a platform based on the Go operating system. It went nowhere.

Similarly, Motorola's government electronics group developed a low-earth-orbit satellite constellation with fascinating concepts for in-orbit call handoff that became the basis for the PCS-like network called Iridium. The limited-liability partnership formed under Motorola's lead borrowed heavily and coordinated three nations' launch facilities in order to make sure the Iridium system was functional by the end of 1998.

But because less attention had been paid to cellular market dynamics, the effort came to naught. Handsets stayed bulky and expensive, and the service proved to be too costly to make sense for most users. The service declared bankruptcy and the Iridium constellation is essentially complete in space, but unused except by network testers.

Motorola now runs semiconductors autonomously, serving all its divisions as well as external merchant customers.

The Century of the Engineer: Companies that made a difference

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