Motorola joins the pink-slip bandwagon
By siliconindia   |   Wednesday, 17 December 2008, 23:41 IST   |    3 Comments
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Mumbai:The rippling effects of the economic slowdown and recession does not seem to have spared the Indian telecom sector as technology and communication bellwether Motorola announced the retrenchment of 3000 of it's employees worldwide, 100 of which are in India, representing around five percent of their global workforce. "Although we have a very strong global brand and a solid balance sheet, we are not immune to the currently weak global economy. Motorola continuously reviews it's business and the market to ensure that it is in-sync with the market conditions, and focus on our top priorities aren't lost," said a company spokesperson. Sources also reveal that the exercise-cuts across the entire board was bound to happen for quite some time. An initial list of the 'laid off' employees, that was circulated across it's India offices reveal that software-engineers, Vice-Presidents and persons from the sales and marketing division have been the main casualties in the cost-cutting exercise. After posting a third quarter net-loss of $397 million (Rs 1,929 crore), as compared to a net-profit of $60 million recorded in the year-ago period, coupled with a worldwide drop in it's handset share, Motorola was hard pressed to effect remedial changes resulting in the company announcing it's intentions on October 31 this year. According to a research report by Gartner, sales of Motorola handsets had dropped to 24.6 million units as compared to 37.8 million units a year ago, during the same period. Carolina Milanesi, Research Director, Gartner had also said in the report that a lack of compelling products along with it's inability to afford price adjustments, as pursued by it's competitors in an aggressive manner has been the main reason for the present situation. "This means that it cannot afford if it wants to please investors by retaining margins. We expect Motorola�s issues to continue well into 2009." said Milanesi. What is even more significant from it's Indian perspective is that a steady and slow decline has been reported in it's Indian market. Analyst reports show that Motorola's market share is at a lowly 5.9 percent, with Finnish mobile giant Nokia leading the pack at a comfortable 59.5 percent market share. The company spokesperson also added, "Motorola is working in a diligent manner to improve the profitability of the business and has commitment in delivering a strong portfolio of exciting new products in 2009 and beyond."

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