Motorola Says Hytera Sanctions Would Not Affect Competition, 7 Dealers Disagree
Friday, August 17, 2018 | Comments

In a filing with the U.S. International Trade Commission (ITC), Motorola Solutions argued that proposed ITC sanctions against Hytera Communications would not impact competitive conditions in U.S. markets.

Meanwhile, seven dealers that sell Hytera Digital Mobile Radio (DMR) products submitted public interest statements arguing that the proposed sanctions against Hytera would both harm public safety in the U.S. and competitiveness in the LMR market.

In July, Administrative Law Judge Mary Joan McNamara released an initial final determination that found Hytera violated four Motorola patents. As sanctions, she recommended that the ITC implement exclusion and cease-and-desist orders against Hytera that would prevent the sale and importation of the infringing Hytera products in the U.S.

Hytera has asked for a review of the initial determination, and the final determination could be different from McNamara’s if the ITC determines the facts support such a conclusion.

In its filing on how the sanctions would impact the public interest, Motorola argued that the sanctions would have little impact on the public interest. Specifically, Motorola argued that the sanctions would not impact public safety and would not negatively impact competitive conditions in the U.S. LMR market.

The void left by an exclusion of the infringing Hytera products would be filled by Motorola and other radio manufacturers, Motorola’s filing said.

“Motorola stands ready to supply the needs of U.S. business and customers with two-way radio equipment and systems that practice each of the Motorola patents at issue,” the filing said. “And numerous other companies supply competing products in the U.S.”

While Hytera products are used by public safety and other mission-critical entities, the proposed sanctions would not impact the ability of those organizations to perform their functions because there is “a ready availability and abundant supply of alternative products” on the market, Motorola said.

Similarly, Motorola argued that excluding Hytera’s products from the U.S. market would not impact competitive conditions in the U.S. LMR markets because there are a variety of DMR alternatives to the Hytera products available.

“A slight reduction in consumer choice is not a basis for denying relief,” Motorola said in its filing. “… U.S. consumers would be free to look not only at Motorola, but also to other competitors. The existence of ‘numerous other sources’ for products speaks to the insignificant impact exclusion would have on U.S. consumers.”

The seven Hytera dealers that submitted public interest statements all disagreed with Motorola’s assessment, arguing that the proposed sanctions would hurt both public safety and competitiveness in the U.S. by driving up prices and limiting the radio features customers have access to.

Warner Communications, MicroMagic, Baker’s Communications, Eagle Communications, Nielson Communications, Marcus Communications and EdgeTech all filed statements asking the commission not to implement the sanctions.

All six dealers noted that they serve mission-critical entities and argued that Motorola products would not work for their customers because of their much higher price compared with Hytera products. The more expensive Motorola products would take up more of those mission-critical organizations’ budgets for communications, leaving less funds for other parts of their operations and thus, jeopardizing public safety, the filings said.

Additionally, Hytera’s DMR products have important features for mission-critical applications that no other companies offer at an affordable price, the dealers said. Motorola nor any other company would be able to fill the gap left by the lack of those features, the dealers argued.

As an example, Baker’s Communications pointed to Hytera radios that combine GPS with the man-down function that can both send emergency alerts and help coordinate rescues. “No other suppliers’ products have this unique GPS feature built in their radios,” Baker’s Communications President Douglas Baker wrote in the filing.

Additionally, the dealers expressed concern about the sanctions’ effect on existing Hytera systems in the U.S. If Hytera or its dealers are unable to repair or replace components or radios of existing systems, it would greatly harm the organizations using those systems, the dealers said.

The dealers argued that Motorola would be unable to adequately support or repair those existing systems and expressed concern that instead of repairing existing Hytera systems, Motorola would force organizations to buy a new system, taxing their already tight budgets.

Finally, the dealers argued that Motorola already controls much of the DMR portion of the LMR market in the U.S., and by removing Hytera, its chief competitor in the market, the sanctions would only give Motorola a stronger monopolistic grasp. None of the other DMR manufacturers in the market have the products to truly compete with Motorola, the dealers argued.

Both Baker’s Communications and Nielson Communications said that the proposed sanctions could put them out of business because Motorola will no longer work with them because they continue to sell Hytera products.

In its own public interest statement, Hytera asked the ITC if it moves forward with the sanctions to add an exception that allows it and its authorized dealers to repair and replace components of existing systems. Hytera also asked the ITC to delay the sanctions to give Hytera time to transition its existing customers to noninfringing products.

Hytera has submitted designs for new DMR products to the ITC and asked it to confirm that they do not infringe the Motorola patents. The ITC expects to release its final determination on the case in November.

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On 8/22/18, Anonymous said:
The seven Hytera dealers are not credible. There are a number of Digital Mobile Radio (DMR) manufacturers in the North American marketplace to service and supply the Hytera customer base. Hytera has stolen intellectual properties that were developed and owned by Motorola; they deserve to be sanctioned.

On 8/22/18, Anonymous said:
Alex from Advantech is clueless in what he states. The Motorola dealer network at least outnumbers Hytera's dealer network 10 to one. They are more capable, have a higher grade of experience, and are very highly qualified. XTP and Pseudo trunking are qualities of the Motorola Digital Mobile Radio (DMR) product line. Opening time slots and trunking systems without dedicated control channels Motorola developed and has been selling for seven years before Hytera copied the Motorola platform. Your statements are false. I know. I spent 33 years developing dealer channels for both Motorola and Hytera. Sorry to see you only know how to sell on price alone.

On 8/22/18, Bob Fay said:
It has and continues to amaze me that Motorola seems to be able to compete rather effectively without such heavy-handed proprietary tactics everywhere but the U.S. If there was no need for a competitor like Hytera, nobody would be buying it. Perhaps as another has suggested Motorola should go back to its roots and resume producing quality products that meet the needs of the marketplace at a price the market can afford. Deny it though they may, in the U.S., they have a long history of predatory proprietary practices aimed at keeping any serious competition out and controlling the market.

On 8/21/18, Gary Correia said:
Interesting article. However the comment that Hytera is the only radio to combine GPS with man-down function is factually incorrect. Simoco's Digital Mobile Radio (DMR) radios have this very same function and many more.

On 8/21/18, Alex said:
Motorola prices are ridiculously high and their radios do not have a lot of the features that Hytera has at a price point that many organizations can buy without breaking the bank such as XPT trunking, Pseudo Trunking, and dual mode analog and DMR on the same channel. I have been in the LMR business for over 25 years and since I was a young tech I could see how Motorola always overpriced, overpromised and never delivered on time radio systems. Now that there is a new kid on the block that can take them on, they cry. That is why Motorola this year and next does not want its dealers to go to IWCE. They do not want its dealers to see and talk to Hytera. Look what they did this year at Orlando and what they are planning for next year.

Motorola wants to be a bully and they will lose. There are a lot more Hytera dealers than Motorola dealers.

Advantech Comm Sys

On 8/19/18, Laurin Cavender said:
I am a lifetime supporter of the Big M but the BatWing has got it all wrong this time. Motorola would not have the problems they have if they had been treating their customers and their sales and support network right to start with. If Motorola had not left the U.S. collectively hanging, there would have been no vacuum for Hytera to fill, so in short, Motorola is to blame for its own problems. Motorola forgot who they were and how they got there and the people who put them there. They, like Radio Shack, decided they were a cellphone company and forgot us lowly two-way folks, and when you forget your base and you forget who you are and how you got there, you create your own problems. And they just might not only come back to bite you, but take you down.
Laurin WB4IVG

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