Motorola 2015 Annual Report Download - page 5

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Services Segment
The Services segment provides a full set of service offerings for government, public safety, and commercial communication
networks. In 2015, the segment’s net sales were $2.0 billion, representing 35% of our consolidated net sales. The Services
segment has the following principal product lines:
Integration services
Integration services includes the implementation, optimization, and integration of systems, devices,
software, and applications. Integration services represented 45% of the net sales of the Services
segment in 2015.
Managed & Support
services
Managed & Support services includes a continuum of service offerings beginning with repair, technical
support, and hardware maintenance. More advanced offerings include network monitoring, software
maintenance, and cyber security services. Managed service offerings range from partial or full operation
of customer owned networks to operation of Motorola Solutions owned networks. Services are provided
across all radio network technologies, Command Center Consoles, and Smart Public Safety Solutions.
Managed & Support services represented 52% of the net sales of the Services segment in 2015.
iDEN services
Integrated Digital Enhanced Network (“iDEN”) is a Motorola Solutions proprietary push-to-talk
technology. iDEN services consist primarily of hardware and software maintenance services for our
legacy iDEN customers and represented 3% of the net sales of the Services segment in 2015.
Strategy and Focus Areas
Our strategy is to partner with our customers to enable them to efficiently deliver reliable services through our innovative
products and best-in-class services. We have a history of delivering these products and services by focusing on the following
areas:
• Building technology that improves productivity and safety;
• Driving innovation and thought leadership;
• Ensuring security and resiliency;
• Providing ongoing support for customer investments; and
• Delivering complete solutions, comprised of infrastructure, devices, system software and applications, and
services to solve complex communication needs.
This focus provides us with the leadership position we have in our core products. We define our core products as our
standards-based voice and data communication devices and systems and the related Integration and Managed & Support
services. We expect to demonstrate strong results from our core products and services through: (i) leading the ongoing global
migration to digital products, (ii) continuing to innovate APCO P25, TETRA, and DMR standards-based voice and data
communication devices and systems, (iii) innovating new products and technologies for the future, (iv) enhancing and expanding
our services offerings including Managed & Support services; and (v) expanding our direct sales and channel partner programs
both geographically and across new commercial verticals.
We believe we have the scale and global presence to continue to maintain a leadership position in our core products. We
have over 12,000 systems deployed in over 180 countries around the world. These systems have a multi-year useful life to the
customer. We believe many of our government and commercial customers have yet to replace aged analog communications
networks with next-generation digital systems that enable enhanced features and more efficient use of spectrum, providing us
opportunities to help customers migrate to these digital systems. In addition, we believe government and commercial customers
are just beginning to experience the benefits of converged wireless communications and the efficiencies realized through a
connected, mobile workforce, which will provide opportunities for the implementation of new public safety communications
systems. We believe we are well-positioned to assist our customers in the deployment of new networks as additional public
safety dedicated spectrum becomes available.
In addition, we continue to innovate around our existing core products and services by finding innovative ways to improve
our products by adding features and functionality to improve the user experience. By partnering with customers and observing
how our products are used, our goal is to enhance our customers’ experience through future product enhancements and
upgrades.
In addition to focused research and development ("R&D") efforts on existing technologies, our strategy for long-term
growth and the evolution of our business includes the development of: (i) next-generation public safety solutions' including public
safety Long Term Evolution ("LTE") systems and devices, (ii) Smart Public Safety Solutions including critical command center
applications that incorporate voice, data and video, and (iii) new product introductions for expansion into core-adjacent markets
and geographic regions.
We have been investing in next-generation public safety broadband networks based on the LTE standard since 2010,
which reflects our belief that broadband is a foundational long-term trend for our government and public safety customers
globally. We believe that the application of these new broadband technologies will also generate innovation and lead to new
smart public safety technologies, products, and services which will change how government and public safety organizations
create, organize, and effectively manage vast amounts of data. These changes will also require a more comprehensive
approach to the services required to assist our customers in managing an ever more complex world of real-time, interconnected
technology and processes.