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Motorola Buys Symbol, a Potentially Big Boost to Its Enterprise Initiatives| September 21, 2006 | Enterprise Mobility - U.S. | Competitive Intelligence Report | Client Access | Analyst: Kathryn "Kitty" Weldon
On September 19th Motorola announced its plan to acquire Symbol Technologies for approximately $3.9 billion. Motorola’s plan is to combine the two companies’ assets, expertise, customer and supplier bases, and industry-leading products to become a leading player in the enterprise mobility market and further its aims of providing seamless mobility. • Current Perspective: Slightly positive on Motorola’s planned acquisition of Symbol Technologies, a leader in the market for ruggedized enterprise digital assistants (EDAs) as well as WLAN-based retail and factory floor asset management, data capture, and transaction/payment systems. The acquisition not only opens up opportunities for both companies, but it also signals a possible blending of WLAN and WAN devices and data applications for the enterprise (beyond receiving e-mail from hotspots). • Vendor Importance: Moderate to Motorola, as the vendor can help to bring factory floor/retail mobility solutions to the next level by enhancing them with its existing wide area/cellular technologies, channels, and customers. This provides the vendor with a unique opportunity to turn what is still a nascent market into a major opportunity. Conversely, Motorola can leverage Symbol’s extensive channel partners and customers in key verticals to sell its existing product lines. The deal is highly important to Symbol; Motorola’s clout should enhance the combined company’s ability to reach new markets. • Market Impact: Moderate on the enterprise mobility market, because there have been very separate ecosystems for WWAN-based field force automation and near field technologies such as RFID and bar code scanning. While Symbol launched its first voice-enabled WWAN-capable ruggedized enterprise digital assistant in January, its $2,000 price tag significantly limited its uptake. Similarly, many SMBs have been priced out of the market for Symbol’s core bar code products. If Motorola can offer a converged ruggedized WLAN/WWAN device at palatable price points and follow through on its plans for “seamless mobility,” the market for mobile industrial applications may take off in a big way. Recommended Competitor Actions • Kyocera has an M2M division and a lapsed Palm-based smartphone line. The company could combine the two to take on Motorola and Symbol and take advantage of this expanding market niche. • Nokia’s portfolio of S60 E-series devices has hit the market this quarter (including the E62 from Cingular in the U.S.) and comprises three separate form factors. A ruggedized model for field workers is missing from this group. • Intermec and other ruggedized EDA and RFID competitors need to embrace the WWAN through partners or acquirers. • RIM first expanded its BlackBerry line out of the executive suite and into sales and middle management with the 7100 series. It is attempting to enlarge its market again by targeting prosumers with the Pearl. However, entire categories of mobile workers are ignored by its product line.
Recommended End User / Customer Actions • Existing Symbol customers are likely to benefit from a Motorola acquisition as prices may come way down and new applications may be mobilized. They can also now look to a larger, global, and more powerful provider of mobile enterprise solutions. • SMBs looking for integrated, yet inexpensive mobile data collection tools do not have many options. It is possible that Symbol and Motorola will build entirely new products to address this need, but nothing has been announced. In the meantime, Nextel offers several handset-based solutions for limited vertical market applications such as service and delivery.
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