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March 11, 2013 by Dan Grose
Google is to cut a further 1,200 jobs from Motorola’s Mobility Unit following huge financial losses.
The redundancies will come on top of the 4,000 job losses the search giant previously announced, adding to further cost-cutting measures of its recently acquired mobile arm.
A company email published by the Wall Street Journal has confirmed the job losses will be contained to India, China and the United States of America, and detailed the specific reasons behind the cuts.
Google outlines in the email that its costs “are too high, we’re operating in markets where we’re not competitive and we’re losing money.”
Speaking to Reuters news agency, Niki Fenwick, Google spokesperson, acknowledged that ongoing redundancies were difficult for all involved. “It’s obviously very hard for the employees concerned, and we are committed to helping them through this difficult transition”.
Despite forking out £8.3bn for the American mobile manufacturer just last year, Google is struggling to turn around big losses brought about by a patchy reception of the latest wave of Motorola handsets.
With these handsets already in place at the time the firm was acquired by the search gaint, Google continued with their production and, as such, reported operating losses of $152m (£102m) at the end of Q4 2012.
Reactions to the deal, which was completed in August 2012, were decidedly mixed. With such strong backers some saw it as the perfect opportunity for Motorola to recover the reputation it had enjoyed previously, whilst others saw its future as little more than an hardware arm for the ever-ambitious Google.
Whilst less than six months have passed, it seems the company’s fate has been decided already. Although heritage and history is important, Google was never likely to stand on ceremony with a company haemorrhaging money, especially after such a sizable initial outlay.
Recent quotes that claim Google “was not in the business of losing money” with Motorola can be taken one of two ways, but with this latest raft of redundancies it appears as if more cost-cutting measures can be expected soon. Just a quarter of original Motorola employees now remain, and more are likely to follow should it be deemed necessary.
For the one-time kings of the mobile world, Motorola’s continuing loss of identity is undeniably sad, yet equally unavoidable. Although fears over it happening have proved to be accurate, such catastrophic financial losses have effectively forced Google’s hand into doing something it would have, in all likely likelihood, ended up doing anyway.
The acquisition of Motorola was as close to the final piece in a puzzle as it’s possible to get for Google. With a mobile presence already well-established through the Android operating system and increasing social and storage options, a hardware arm would allow for in-house device production, thus removing the need to look outside its walls in order to create its devices.
That Motorola has continued to lose money is nothing more than a coincidence for the company, effectively justifying the decision to use it as nothing more than a ready-made hardware department. Nothing is yet set in stone, but Motorola‘s absorption into the growing vastness of the Google empire seems inevitable.
Hopefully there will be time for one last hurrah from a company once as popular as Nokia in the mid-nineties, and as Apple has been since the advent of the iPhone. Despite a somewhat mixed reception, the Motorola RAZR i showed some excellent qualities, and with its predecessor the Motorola RAZR HD still to touch down on UK soil, we can only hope there’s at least a final flourish from an iconic name.
The story of Motorola can be told and interpreted in many ways, but it comes down to nothing more than one cold, hard truth: business sense. Whilst it is more than deserving of sentiment and reverence in the face of seemingly harsh treatment, it is nothing more than a victim of the cut-throat vision necessary to survive in a competitive environment.
Google will eventually profit from Motorola’s plight, and that can be seen as harsh in many ways. But, when faced with total annihilation on its own or a part-stripping exercise at the hands of another company, it has to be seen as the lesser of two evils.
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