Motorola Mobility is planning to leave unprofitable markets and stop making low end devices as it looks to better compete with the biggest players in the sector Apple and Samsung.
The move will result in about 4,000 job losses, two thirds of which will be outside the US, and the closure of a third of its 94 offices worldwide. Motorola would not be drawn on specifics as to how the cuts will affect the UK or the company’s marketing department when contacted for comment.
Motorola plans to base the bulk of its operations in the US, where it has 11.7 per cent market share of the total feature phone and smartphone handset market, according to comScore data to June. In the UK, Motorola has just a 0.6 per cent share of the smartphone handset market.
It marks Google’s first major strategical impact on Motorola Mobility since it acquired the handset maker for $12.5bn (£7.9bn) in May.
The company ousted Motorola Mobility’s chief executive Sanjay Jha shortly after, replacing him with its own executive Dennis Woodside, who was Google’s president of the Americas region and ad sales lead. Google also announced after the acquisition that 40 per cent of Motorola’s vice president roles will be laid off, which could include senior marketing staff.
Google plans for Motorola to make fewer phones than the 27 it produced last year, which will have “cool” features such as sensors with voice recognition, long lasting batteries and quality cameras.
The innovations will be led from Google’s Advanced Technology and Projects division, which is led by Regina Dugan, who was hired from the Pentagon’s Defense Advanced Research Projects Agency in March this year. The division is recruiting metals scientists, artificial intelligence experts and acoustic engineers to build its new high end smartphones.
Woodside told the New York Times, which had a pre briefing on the announcement: “The Google business is built on a wired model, and as the world moves to a pretty much completely wireless model over time, it’s really going to be important for Google to understand everything about the mobile consumer.”