Motorola said Monday that it appointed former Qualcomm executive Sanjay Jha to head its struggling wireless handset business. Appointing Jha was the first major step toward spinning of the handset unit, a move Motorola announced in the spring.
Jha will also serve as co-chief executive office with Gregory Q. Brown, who will lead the company’s home and enterprise broadband business.
Jha’s appointment immediately boosted Motorola’s share price. By the end of Monday, shares jumped more than 11% to $9.82. The upswing also moved some investment analysts to categorize the stock as buy instead of under-perform.
Jha has been chief operating officer of Qualcomm since 2006, but he was with company for more than a decade before that.
The former Qualcomm exec is enormously respected in the industry and Motorola said in statements that he was hired because of his extensive operational experience. But Jha has a tall order to fill. Motorola has been smacked around in the handset market by smart phones like Research In Motion’s BlackBerry, and Apple’s iPhone, as well as other phones from competitors Nokia and Samsung.
In fact, Motorola hasn’t had a seriously successful phone since the Razr, and now analysts say if the company doesn’t come out with something equally popular, the handset unit doesn’t stand a chance.
Jha seems confident. He told analysts during a conference call Monday that within 90 days he would announce which software platform Motorola’s next generation of phones would use.
Even still, there are internal battles brewing at Motorola that could overshadow Jha’s best efforts. At this point execs haven’t even decided which side of the company will get the Motorola brand name. The phones obviously need a recognizable name, but the company’s home and enterprise networking divisions are doing a much stronger business.
Some also wonder if it is smart to separate the handset business from the enterprise broadband division considering the ever-growing number of mobile workers that depend on smart phones and other devices. A few channel partners have said in the past that the obvious move would be to eventually sell groups of handsets along with networking equipment.