Google-owned smartphone maker Motorola Mobility said Monday it is winding down nearly all of its South Korean operations in 2013, as part of a broader restructuring effort to slash costs.
"On December 10th, we began communicating to staff in Korea our plans to close most of our operations in Korea, including our research and development and consumer mobile device marketing organization," a Motorola spokesperson said in an emailed statement to CRN. "The changes in Korea reflect our plans to consolidate our global R&D efforts to foster collaboration, and to focus more attention on markets where we are best positioned to compete effectively."
Motorola, in what it referred to as a "difficult but necessary decision," said it will relocate about 10 percent of its Korean R&D staff to other facilities, but it did not specify how many jobs will be cut.
"For other staff we will strive to make the transition as smooth as possible," the spokesperson said.
Motorola's announcement comes just four months after its parent company Google said it was cutting 4,000 jobs -- or about 20 percent -- of Motorola's 20,000-employee staff. Google, which acquired Motorola Mobility for $12.5 billion in May, said two-thirds of the cuts would occur outside the U.S., and that nearly 90 Motorola facilities will be either consolidated or closed. The cuts are necessary, Google said at the time, to cut down on Motorola's costs and make the smartphone maker more competitive.
"These changes are designed to return Motorola's mobile devices unit to profitability, after it lost money in fourteen of the last sixteen quarters," Google wrote in an 8-K filing announcing the layoffs.
In October, Google filed a separate 8-K form, suggesting further Motorola job cuts were to come. The company didn't specify how many additional jobs were to be impacted, but again said most would take place outside of the U.S. Google said in October it expects to take a $90 million hit for Motorola-related restructuring charges over the next year.
Motorola has struggled to remain competitive in the mobile handset market over the past year, with research firm Gartner pegging its third-quarter market share at 2 percent, down from the 2.5 percent it captured during the same period last year. Market leaders Samsung and Nokia, by comparison, accounted for 22.9 percent and 19.2 percent, respectively, followed by Apple with 5.5 percent share.
PUBLISHED DEC. 10, 2012