Motorola Spins Off Semiconductor Business

[DrBoar]

Moto still spinning and spinning...
Even if the semiconductor part will eventually get into good hands will they to that without loosing momentum (do not laugh!) and keep up a steady production of G4s
😕

The thought of the semiconductor part getting stuck in a "not yet spun of state" at Motorola or extensive reorganization in the new structure were the G4 production is less good than normal must scare Apple.

My bet is that a speedbumped eMac will be the last we see of "new" g4s used by Apple. If 2003 was he year of the portable computer then 2004 will not be it and the PB will be stuck with the current CPUs until the G5 90nm arrives.

I would not mind see a the former Moto reborn and suddenly sprouting G4s reaching 2 GHz and supporting DDR snappy FSBs but the last time they were able to make a leading edge desktop CPU was the 68030 40 MHz way back in 1990, and is the more of a decade of problem only caused by Dilberts in the top of Motorola

 

[Dont Hurt Me]

please look we have 1.6, 1.8.2.0 G5's right now. the best moto has is a 1.3 g4??? I hope & think this will be the last run of g4 models with more g5's showing up after the holidays. why stick with the g4?? move on to better. G4's are not exactley cheap.

 

[ftaok]

Re: Turn down the flames, please

Originally posted by yamabushi
Motorola has failed, which is why they are doing the spinoff. I am really not surprised at thir failure. I noticed some disturbing attitudes among their management when I talked with them near their offices in Illinois. They were too complacent and judged their future chances of success to be assured based upon past success. I am sure that not everyone at the company shared this attitude, but it seemed to be a common theme. IBM has been far better able to adapt to change.

To think that Moto's inability to produce faster PPC chips for Apple is the reason that Moto SPS is overstating Apple's importance. PPC sales are such a small part of SPS's business. Apple has very little clout within Moto's semiconductor business.

The main reason that SPS is losing money is that they aren't able to sell their chips for the PCS business. Their only customer is Moto's phone business. Nokia and Samsung aren't buying Moto chips. The theory behind spinning off SPS is that the perception of a conflict of interests is removed, therefore, the Nokias and Samsungs will consider buying chips from SPS.

The problems surrounding Apple and Moto's relationship has very little to do with the spinoff.

 

[rickag]

Re: Re: Re: Re: Re: IBM is also losing money on chip fabrication

Phinius

Itanium competing with Power 4
hahahahahahahahahahahahahah!!!

thanks for the laugh. What, have you been looking at, lame benchmarks? Itanium isn't even in the same class of processors as the Power 4. Comparing these 2 processers is like comparing Apples and Oranges.

 

[DrBoar]

The problematic Apple-Motorola rellation as such may have very little if anything with the SPS spinof. However, the reasons for those problem might point to the core of why Motorola is spinning of SPS.

Take a look at this:
Replacing the very nice 68030 was the 68040 that was to slow to keep up with the 486 as the 68040 would not scale well
Replacing the 68040 was the 68050 and 68060 but they were so late that they forced Apple to jump to the PPC CPUs despite all the costs.
601 went well as did the 603 mostly
604 went well thanks to IBM supplying the faster CPUs (Motorola manufacturing problems)
G3 went well thanks to IBM supplying the faster CPUs (Motorola manufacturing problems)
G4 went to hell as IBM could not help when Motorola had manufacturing problems. Perhaps Moto and Apple have different views of things but that stall on 500 MHz must have been bad for Motorola as well and it still took more than a year to sort out.

Bad things might happen to every CPU manufacturer so I do not blame Moto to be stuck at 500 MHz 4 years ago with AMD reaching 1 GHz ( and Intel not that much later). The sad thing is that they during four years never have even had the smallest reduction of this 1:2 speed gap, if anything they have been closer to slide to 1/3 of the clock speed of the P4.

Time for Apple to spin of Motorola

😛

 

[Bruja]

Originally posted by Phil Of Mac
By doing this, could Motorola dodge getting sued by Apple over the G4 debacles?

That wold explain a lot of things but i don't think that aapl should let Moto off the hook. Moto still sux turtle toes because they are a material factor in why the processor chips were not released to aapl in a timely fashion.

Note: aapl is the stock listing😉

 

[cerid]

Thanks ftaok!

First time to read something resonable. I know Motorola SPS for more than 20 years. They have been the best chip manufacturer in the past but during the years strategies in the company shifted to sales focused operations instead of R&D. Being market leader in embedded controllers the small revenue with PPC for Apple made no sense. In addition Apple's desicion to take back the MacOS license after Motorola got the 40 million Mac clone order from China gave the last drop to let the glass overflow. Revenue of PPC's for networking, communication, automotive and other sectors are by an order of magnitude larger compared to Apple G4s.
The corporate allways poked in SPS, and many high-end designs were stopped due to wrong decisions by their high ranked bosses. The spin-off will free SPS, and allow them move, decide and develop much faster than now.
The SPS will also be able to sell chips to other phone makers like Nokia
since they will be no more rivals.
To my opinion the spin-off is the best decision ever made and we will soon see the new company producing high performance CPUs.
🙂

 

[ftaok]

Originally posted by Bruja
That wold explain a lot of things but i don't think that aapl should let Moto off the hook. Moto still sux turtle toes because they are a material factor in why the processor chips were not released to aapl in a timely fashion.

Note: aapl is the stock listing😉

This is another thing that bugs me (not that that means anything).

Apple is not going to sue Motorola because there is no grounds for a lawsuit. That whole "Moto didn't give Apple enough notice" thing is completely ridiculous. How could Motorola give Apple one years notice that they were going to kill the G5 project? Seriously, how do they do that?

Here's the scenario. Motorola decides that going forward with the G5 would be financially unwise. Do they a) tell Apple right away that they are cancelling the project and risk being sued by Apple OR b) they tell Apple that they are planning on cancelling the G5 project in about a year, but they're still developing it (wink wink).

Get over this whole Apple sues Moto thing. It's ridiculous.

 

[rickag]

Originally posted by cerid
Thanks ftaok!

........ the small revenue with PPC for Apple made no sense. ...... after Motorola got the 40 million Mac clone order from China

"small revenue with PPC for Apple" - I believe this is a misconception that is repeatedly spread over the internet. In a press release from Motorola about 2 1/2 years ago, they stated that Apple was one of their top FIVE customers, and that was before beginning to use the G4 in the iMac and eMac's. Apple has purchased right @ half of all the G4's ever made. Throw in the fact the the cost/price of the G4 is an order of magnitude more that the vast majority of embedded chips sold, the dollar value in sales to Apple was, until introduction of the G5, very significant.

"40 million Mac clone order from China" - I'd be mad too, but Apple's survival depended on eliminating clones. If Apple hadn't stopped licensing their systems, there was a very real chance we'd not be discussing this right now, because there'd be no Apple.

I have nothing against Motorola and wish them well, but I could never fully understand their lack of interest and/or commitment in advancing the G4. Sure it was a risk, that is take a chance on what was a feeble Apple at the time, but when the G4 was introduced it was superior to the competition, it just stagnated @ 500 MHz for wayyyyy toooooo lonngggggg.

 

[Phil Of Mac]

Originally posted by ftaok
Apple is not going to sue Motorola because there is no grounds for a lawsuit. That whole "Moto didn't give Apple enough notice" thing is completely ridiculous. How could Motorola give Apple one years notice that they were going to kill the G5 project? Seriously, how do they do that?

It would depend on the terms of the contract between Apple and Motorola, and the Motorola G5 is not the only grounds for a lawsuit.

By poor management of SPS, Motorola was unable to deliver on their obligations to Apple. That may be grounds for a suit, but IANAL.

 

[ftaok]

Originally posted by Phil Of Mac
It would depend on the terms of the contract between Apple and Motorola, and the Motorola G5 is not the only grounds for a lawsuit.

By poor management of SPS, Motorola was unable to deliver on their obligations to Apple. That may be grounds for a suit, but IANAL.

The lawsuit that I was referring to was the one that had been making the rounds over the last couple of months. It was the one where Moto was in breach of contract with Apple because they failed to give 1 years notice before terminating the G5 project.

I agree, there could be lawsuits filed if Moto failed to deliver to Apple what was contracted. But I'm not privvy to that info.

Anyways, aside from the "can't get to 500mhz" debacle, I don't think Moto has missed any timeframes since then. At least Apple hasn't made any statements as such. What other obligations were there? The 7447/57 G4 chips went out in Q3 like they promised.

 

[Phil Of Mac]

Originally posted by ftaok
The lawsuit that I was referring to was the one that had been making the rounds over the last couple of months. It was the one where Moto was in breach of contract with Apple because they failed to give 1 years notice before terminating the G5 project.

If it was legal within the bounds of contract law to sign a contract to that effect and Motorola violated that contract, then they are liable.

If it was an unreasonable thing to ask of them, they shouldn't have signed the damn contract in the first place. Contract law doesn't protect you from your own bad judgment in signing contracts.

 

[ftaok]

Originally posted by rickag
"small revenue with PPC for Apple" - I believe this is a misconception that is repeatedly spread over the internet. In a press release from Motorola about 2 1/2 years ago, they stated that Apple was one of their top FIVE customers, and that was before beginning to use the G4 in the iMac and eMac's. Apple has purchased right @ half of all the G4's ever made. Throw in the fact the the cost/price of the G4 is an order of magnitude more that the vast majority of embedded chips sold, the dollar value in sales to Apple was, until introduction of the G5, very significant.

I'm not sure which press release that you're talking about, but I do remember one from Jan 2002, right after Moto released the 1ghz G4. The guy said something about not mentioning Apple as a customer so as to not pre-empt anything that Apple was doing. He said that Apple is an important partner and they don't want to mess up their product intro's.

Anyways, I've never heard anything about Apple being a top 5 customer. Honestly, I find that extremely hard to believe. Maybe at one point, they were, but there's no way they are anymore. Moto's SPS does so much more than just PPC and G4s. They're pumping out Dragonball's for Palms and chips for cell phones. No way that Apple's still a top 5 customer.

I'm also questionable about whether Apple has purchased 1/2 of all G4's produced. Cisco is a big company that uses G4s. There are others that use them as well.

 

[ftaok]

Originally posted by Phil Of Mac
If it was legal within the bounds of contract law to sign a contract to that effect and Motorola violated that contract, then they are liable.

If it was an unreasonable thing to ask of them, they shouldn't have signed the damn contract in the first place. Contract law doesn't protect you from your own bad judgment in signing contracts.

Phil,

This is exactly what I'm saying. That supposed contract between Moto and Apple doesn't exist. It can't. That type of contract can never be honored, so it can't exist.

Everyone was saying how Moto was in breach of contract because they pulled the plug on the G5 without telling Apple about it a year in advanced. Think about that. How can you tell someone that you're pulling the plug a year in advanced? You can't.

That's why you'll never see a lawsuit against Moto for this. And that's the alleged contract that I was referring to.

 

[Phil Of Mac]

Originally posted by ftaok
Phil,

This is exactly what I'm saying. That supposed contract between Moto and Apple doesn't exist. It can't. That type of contract can never be honored, so it can't exist.

Everyone was saying how Moto was in breach of contract because they pulled the plug on the G5 without telling Apple about it a year in advanced. Think about that. How can you tell someone that you're pulling the plug a year in advanced? You can't.

That's why you'll never see a lawsuit against Moto for this. And that's the alleged contract that I was referring to.

Apparently so. However, this does not utterly rule out the possibility of Apple suing Motorola on unrelated or partially related grounds. Until such a suit is filed, it is ignorant for either of us to comment about it beyond these hypothetical remarks.

 

[yamabushi]

Originally posted by Phil Of Mac
It's not a matter of share, it's a matter of markets. As long as Macs are still prevalent in some fields, those fields will be Mac-based, and software will exist. Overall market share doesn't matter that much.

I disagree. A lack of market share has resulted in sluggish software development as well as a lack of widespread support for macs in many hardware devices such as graphics cards. Macs are relegated to second or third choice status for developers. More market share would make Macs more appealing to develop for. The Mac platform is most appealing to them when popular opinion is that Mac appears to be highly competitive with wintel.

Originally posted by rickag
I have nothing against Motorola and wish them well, but I could never fully understand their lack of interest and/or commitment in advancing the G4. Sure it was a risk, that is take a chance on what was a feeble Apple at the time, but when the G4 was introduced it was superior to the competition, it just stagnated @ 500 MHz for wayyyyy toooooo lonngggggg.

I think this is where Motorola failed. The G4 chip design is pretty good but delivery times and clock speeds were poor compared to intel. Ideally they should have been able to keep clock speeds at roughly half that of the Pentiums in order to maintain an overall performance premium. This is a direct result of an aversion to investing in better fabrication methods for the PPC. They never believed that they could really compete with Intel, so they didn't even try. If they had been producing much faster chips Apple would have sold many more computers and Motorola could have sold a few more chips for the embedded market. A long term commitment (several more years) would have been required to realize a return on the investment in fab tech through sales volume.

 

[Phil Of Mac]

Originally posted by yamabushi
I disagree. A lack of market share has resulted in sluggish software development

Really? I haven't seen any of this, except for Quark, and Quark is just Quark.

My point is, if most graphic artists use the Mac, then the Mac will continue to exist, and graphic art programs will continue to exist on the platform. It doesn't matter if graphic artists are the only ones to use the Mac, unless of course you're not a graphic artist.

Originally posted by yamabushi
as well as a lack of widespread support for macs in many hardware devices such as graphics cards.

Gaming isn't a big market on the Mac. Graphics and other professional things that use graphics cards, okay, I can see your point there.

Originally posted by yamabushi
Macs are relegated to second or third choice status for developers. More market share would make Macs more appealing to develop for.

Adobe seems pretty happy, at least now that Macs actually perform at respectable speeds. Final Cut Pro is always up to date on the Mac 🙂

Apple might fall behind in some markets and in overall share, but as long as they hold onto some markets, they will survive and thrive.

 

[yamabushi]

market share

I can't comprehend why Macs are supposed to only stay in niche markets such as graphic design. Graphic designers and such should stop hogging all the market for Macs. Truthfully, it isn't their fault - it's Apple's.

Seriously though, Macs can do just as well in other markets such as business if applications are written for the platform. Macs are great enough to be the computer of choice for most any purpose if apps and hardware support were to exist.

Of course a great many people would still love Windows, Linux or whatever running on x86 or whatever. That's great - the competition will encourage innovation.


When Apple gains 95% market share (and big M has refocused on just making apps) they might get lazy, but we won't have to worry about that for a while. That is uh... ever. 😉

That dream world will never happen, but 35% is completely realistic.

Stay in a niche, and you will get squashed sooner or later by the big boys regardless of how good of a product you have.

 

[Phil Of Mac]

Re: market share

Originally posted by yamabushi
I can't comprehend why Macs are supposed to only stay in niche markets such as graphic design. Graphic designers and such should stop hogging all the market for Macs. Truthfully, it isn't their fault - it's Apple's.

Seriously though, Macs can do just as well in other markets such as business if applications are written for the platform. Macs are great enough to be the computer of choice for most any purpose if apps and hardware support were to exist.

Sure. Apple should make directed assaults on other markets, bribing developers or even developing the software themselves. But they should do it market by market. They shouldn't just randomly and recklessly try to increase share.

 

[Snowy_River]

Re: Single supplier FUD

Originally posted by a1291762
...
Legacy code will be affected by an architecture change but OSX-compatible Carbon/Cocoa code will work with little more than a recompile.
...

Just as a point, it's fine to say that things would run with just a recompile, but what about all the old software that I have? Do I have to buy updated versions that have been recompiled? This is why I hope to never see an architecture change, as I have a ton of (some very) old software.

 

[Snowy_River]

Originally posted by Gyroscope
...MacOS clones in late 90's it just didn't make sense to pour money into PPC advancement...

An interesting point, here, is the fact that the total unit sales of Mac compatible systems was, essentially, stable during that period. The reason that Apple cancelled the clones was because they were loosing sales. So, I don't see that the cancelling of the clones would really have any effect on Moto, as they weren't really loosing any chip sales.

 

[Phil Of Mac]

Originally posted by Snowy_River
An interesting point, here, is the fact that the total unit sales of Mac compatible systems was, essentially, stable during that period. The reason that Apple cancelled the clones was because they were loosing sales. So, I don't see that the cancelling of the clones would really have any effect on Moto, as they weren't really loosing any chip sales.

Yes, but they sold a lot less Mac clones!

 

[Snowy_River]

Originally posted by ftaok
...
Apple is not going to sue Motorola because there is no grounds for a lawsuit.
...

Originally posted by ftaok

This is exactly what I'm saying. That supposed contract between Moto and Apple doesn't exist. It can't. That type of contract can never be honored, so it can't exist.

Here's an easy way to look at it. The contract between Apple and Moto needn't have specified the G5 project. It could have simply stated that Moto would not discontinue the next-generation processor development without giving Apple one year notice. Whether that development was for the G4, G5 or G6 wouldn't matter. The point would be that Apple would be in a position of dependence on Moto, and would demand a certain level of contractual commitment from Moto. It, in no way, seems unreasonable to me.

 

[Snowy_River]

Originally posted by Phil Of Mac

My point is, if most graphic artists use the Mac, then the Mac will continue to exist, and graphic art programs will continue to exist on the platform. It doesn't matter if graphic artists are the only ones to use the Mac, unless of course you're not a graphic artist.
...

Well, there is a decending circle built into this, though, that would result in the end of the Mac. If Apple's marketshare dropped too low, then they wouldn't have as much money for R&D, it'd be more likely that IBM might let their PPC development slip, thus Macs would fall farther and farther behind. Before long, Windows or Linux on x86 would be a better platform and even the niche markets would dwindle. Soon, the Mac would cease to exist as a viable modern platform.

 

[NicoMan]

Originally posted by Dont Hurt Me
macphoria what are you talking about??? Moto stagnation had almost killed us???? 500 mhz g4 for how long. macphoria IBM is what apple needed but they didnt have the best history. things are much different now and they both need each other and IBM is investing big bucks on its semiconductor's. they got some great stuff period. also i am almost certain g5's are less cost then g4's in bulk so what are you saying man?

While all you are saying is certainly true, that means absolutely nothing for the future of the spin-off. There is a chance that as a spin-off SPS will do much better than the old Moto (yeah I know that's pretty easy).