Motorola Solutions Focuses on Airwave Integration, Software Business
Monday, December 14, 2015 | Comments

Motorola Solutions’ acquisition of Airwave will become its largest managed-services operation worldwide, with more than 300,000 users at 300 agencies accessing the network, said Bruce Brda, executive vice president of systems and products at Motorola Solutions. Brda made his remarks during the Raymond James Tech Investors Conference last week in New York.

Brda said Motorola Solutions manages about 22 public-safety networks worldwide, but none as large as Airwave. The company pursued the acquisition of Airwave because the deal was financially attractive, furthered its ambitions in the managed services space and gave it tools, systems and procedures that it hopes to leverage beyond Airwave. Those tools include call centers, network operations centers, managed services toolsets and public-safety-specific applications.

“The toolset itself is global in nature as are the applications,” said Brda.

In addition, Airwave's personnel and assets will help it fulfill its obligations under Lot 2 of the U.K. Home Office Emergency Services Network (ESN) tender, which the company won last week, said Brda.

Following the company’s acquisition of Airwave, Fitch Ratings affirmed its ratings on Motorola Solutions, including the long-term issuer default rating (IDR) at BBB, with a negative outlook. The firm said it expects high single-digit top-line growth in 2016 despite currency and macroeconomic headwinds, because of the $550 million of higher profit margin annual revenues expected to result from the acquisition.

The Airwave acquisition is part of a push by Motorola Solutions to increase its services business and to focus on software capabilities and emerging technologies.

Brda said smart public-safety solutions will represent a large investment area for the company going forward. These systems include next-generation 9-1-1 (NG 9-1-1) call-taking systems, CAD, records management and intelligence-led policing tools that incorporate criminal records, social media, gunshot detection and other data.

“Today that’s used predominantly for post-incident crime resolution — figuring out who did what after the fact,” said Brda. “We have pushed now into mid-incident, so you can use that information in the middle of an incident to respond with more awareness. Where it’s really going is predictive — to be able to use that information to predict and ultimately prevent crime.”

Brda highlighted Motorola’s recently introduced Si500 body-worn camera, which incorporates a remote speaker microphone (RSM) and provides an end-to-end video solution from the camera to the backend system. The camera features a forward-facing display, which Brda said was critical in some countries where subjects are required to be aware they are being recorded. The device also features an Android touch user interface, which Brda said gives the company an application platform worn on the responder that can be expanded to offer new capabilities in the future.

Motorola Solutions estimates the current penetration of the body-worn-camera market among all vendors at only 20 percent in the United States and less in international markets, which creates a meaningful market opportunity, said Brda.

Brda said the Internet of Things (IoT) will apply to first-responder communications with smart sensors that will monitor heart rates, body temperature, respiration, if an officer’s gun is out of the holster or if it has been fired, and if the officer is upright or down. The radio will act as a hub for this information to send it back to the network. Brda said the company has written a set of application program interfaces (APIs) that its smart-public safety solutions team and third-party developers can use to create applications that can pull information from the company’s network.

Brda also detailed the company’s Project Renew initiative, which began about 18 months ago and aims to reposition the company as a competitor in the services and software space. The initiative centers on three pillars — developing the internal systems and processes required to be a software company; repositioning the value model away from capital expenditure (capex) toward operating expenditure (opex) and fixed-term rather than perpetual right-to-use software licenses; and preparation of its sales force.

“We’re well underway there and we think this is necessary for smart public-safety solutions and the other new world stuff, but we have a huge opportunity to attach more software to our existing LMR customers,” said Brda. “We literally have hundreds of features that we’ve developed. These are features requested and implemented at the request of an individual customer. We have a huge opportunity to more broadly leverage those features and sell them to more of our customer base.”

Brda said relocating the company’s headquarters from the suburb of Schaumburg, Illinois, to Chicago and opening a research and development (R&D) center in the city will help it attract software developers versed in cloud technologies and open-source applications.

The company has been shrinking its R&D budget during the past two years. Historically the company’s R&D efforts were organized around individual technologies, including Project 25 (P25), TETRA and Long Term Evolution (LTE), a structure that was heavily redundant, said Brda. For example, each segment had one or more audio labs, which meant the company operated seven audio labs worldwide.

Now the company has folded all of the technologies into a single team and organized its R&D around devices, infrastructure and applications. The company now operates two audio labs and has reduced other redundant operations.

The company is working toward developing common hardware and technology-agnostic user interfaces that can be deployed throughout its product lines with specific modules that change out to accommodate different technologies.

“Without question the market is moving faster, and LTE will force that,” said Brda. “I think what we’ve done, the steps that we’ve taken internally and structurally, will allow us to move much faster.”

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