BY FRED SHLAPAK President, Motorola Semiconductor Products Sector, Austin, Texas

If this downturn is anything like each of the 10 I've lived through in 30-plus years at Motorola, the industry will rebound with unprecedented strength and vitality. Right now, the challenge we're addressing at Motorola is to shape our strategy and structure so that we'll be well-prepared for the market rebound.

We now have the ability to connect the world with the embedded hardware and software solutions that the Semiconductor Products Sector (SPS) creates for our customers. As wireless, broadband and Internet applications expand and intersect, electronic devices are being networked to talk to each other. Consumers everywhere will enjoy the benefits offered by devices that are synchronized, smart and simple to use.

The next wave will be a huge growth driver for communication and networking semiconductor solutions, with $650 billion in net commerce today projected to grow to $6.9 trillion in 2004. With our Smart Networks Platform, SPS is providing network OEMs an open hardware and software environment to trim their time-to-market and time-to-money.

The rollout of 2.5G and 3G wireless services, incorporating high-speed data and video, will greatly expand the array and quality of the mobile experience, far beyond the voice services that launched the wireless revolution. As this shift occurs, SPS will deliver complete 2.5 and 3G solutions in the form of customizable platforms to all of our customers.

Meanwhile, broadband is coming home. As digital consumer and wireless technologies converge, set-top boxes and digital consumer devices for the home will be enhanced and enabled by wireless LANs. Motorola Semiconductor is poised to capitalize on growth in consumer demand for solutions in the home that connect the world using audio, video, imaging, graphics and RF embedded solutions.

Communications and networking are also having a major impact on the automotive market. By 2010, 70 percent of new cars will have telematics capabilities. With our mobileGT architecture, SPS will make it possible for automakers to offer flexibility and scalability for the telematics-enabled "work car" or "fun car."

Structurally, a key corporate initiative is to serve customers with a single, integrated technology and manufacturing organization that provides a complete process technology pipeline, from R&D through delivery-one that will improve the return on our R&D investment. We're also working to grow the markets for MCU, DSP, analog and sensor standard products; increase support for the distribution channel; and improve global sales execution.