Motorola 2006 Annual Report Download - page 46

38 MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
share growth in the Mobile Devices business has increased its share of the global handset market from
approximately 12% to approximately 22%. Going forward, this business will rebalance its market share and
profitability objectives, with greater emphasis on profitability. To do this, we will continue to refresh and revitalize
our product portfolio, with greater emphasis on higher-tier multimedia experiences. At the same time, we are
increasing our focus on our cost structure, with particular emphasis on reducing manufacturing and design costs.
We will seek to reduce costs and accelerate our time to market by focusing on our silicon and software platform
strategies. We will also continue to invest in the Motorola brand, with emphasis on effective marketing of 2007
product line introductions. Although the Mobile Devices business will place a greater emphasis on profitability, we
recognize that near-to-medium term pricing pressures will provide challenges to improving margins and profitability.
The transformation of our Networks and Enterprise business began in 2006, when we combined our cellular
networks infrastructure business with our government and enterprise mobility business, and this transformation will
continue in 2007. In early 2007, we completed the acquisition of Symbol Technologies, Inc., which now forms the
cornerstone of our enterprise mobility business. Our goal is to continue to grow our Networks and Enterprise
business consistently and profitably. We are investing to be the leading infrastructure provider of WiMAX, a next-
generation wireless broadband technology, and we expect the WiMAX market to begin to materialize in 2008 as
several WiMAX networks come on-line. Also, we will continue to develop next-generation products and solutions
for our government and public safety customers, for whom homeland security and public safety needs continue to
be front and center. As the Internet goes mobile and enterprise customers look to enhance productivity, we will
leverage our acquisition of Symbol with our existing enterprise assets to capitalize on the enterprise mobility
market.
Our Connected Home Solutions business will continue to focus on expanding its leadership position in
broadband connected home products and services in North America while capitalizing on new markets outside of
North America. Our shipments outside North America have grown in each of the last three years and these markets
continue to provide new growth opportunities. We believe we are well positioned to capitalize on the convergence
of services and application across delivery platforms within the home and across mobile applications.
We conduct our business in highly-competitive markets, facing both new and established competitors. The
markets for many of our products are characterized by rapidly changing technologies, frequent new product
introductions, short product life cycles and evolving industry standards. Market disruptions caused by new
technologies, the entry of new (and often well-capitalized) competitors into markets we serve, and frequent
consolidations among our customers and competitors, among other matters, introduce volatility into our operating
performance and cash flow from operations. Meeting these disruptive challenges while working towards full digital
convergence requires continual technological advancements and continued investment in innovative solutions. We
must have compelling products that meet the expanding needs and evolving desires of our customers around the
world. We are focused on meeting these challenges and improving our profitability.