Asking and answering the burning questions about the Motorola shakeup:
Moto cut 500 of its 1,700 employees last year, and in March it fired its CEO. Why so much drama?
The Android business has been tough for all players. Now Moto’s formerly pathbreaking low-cost cell phones face heaps of competition.
How might these layoffs affect Chicago’s tech sector?
No loss is good, of course. And Moto is the one local company that connects the city to the center of the global smartphone business in Asia. But Chicago’s tech cluster is growing and maturing, so they mean less than they once would have.
Will these moves stabilize Moto?
Hard to say. Lenovo has changed Moto’s top management three times. Plus, it may be more difficult for a division within a division of a Chinese giant to attract top talent than when it was Google’s cool pet project. Back in 2014, Lenovo pledged to have Moto profitable by mid-2016. That now seems unlikely.
Is it good for Chicago to have one of its key tech players run by the Chinese?
If Moto stays here, it could be very good. Even as it shrinks, it continues to apply for H-1B visas—the ones for skilled foreign workers—mostly for engineers. Not thrilling for local candidates, but good for the city: It globalizes Chicago’s work force, putting it more in line with Silicon Valley.
Could Moto leave?
Sure. In Chicago, it has to pay high rents and wages while competing against rivals operating mainly in much cheaper places, such as China and South Korea. But Lenovo says Moto is here to stay, and it recently made the unit the head of design and engineering for all its phones.
6 months ago