I was buried in a project yesterday and didn’t come up for air until late at night, when I realized it was April 12th – the day MSFT was set to reveal their new mobile devices. From the few things I’ve seen so far, it looks like the reviews were written before the products were revealed, then an image was added and writers clicked Publish, or Send, or whatever. I hope this works for Microsoft and the device division isn’t shown to be a one-hit (XBox) wonder.

The thing is, they’re so late to the market at this point, that it feels like Zune all over again. When Zune was launched in 2006, Apple had a 5 year head start. That wasn’t like Apple were the pioneers who got the arrows, while Zune could be the metaphorical settlers and get the land. Apple had settled, planted and harvested the land, built the infrastructure, opened the stores and couldn’t keep enough of their product on the shelves. Zune was dead late and dead out of the gate. Consumers were on their second or third iPod at that point – and instead of marketing to where there was a slight opportunity – adults 25+, parents, people who had trusted and were familiar with MSFT and Windows and to whom Apple was still an outlier – MSFT went after the 18-24s with Zune – the early adopters who were entrenched in their gen 2 or 3 iPod, and for whom MSFT was decidedly uncool. So Apple continued to sell between 11 and 15 million iPods per quarter, while Zune took over 2 years to sell 1 million units.

Now its Q2, 2010 and Apple has had close to 3 years of selling the iPhone, with over 50 million units in the market and a situation that is eerily familiar. The wind is at Apple’s back. Enterprises have abandoned the once widely used Windows Mobile platform for the Blackberry platform, leaving Microsoft with market challenges in consumer, and professional use of mobile devices. And then there’s that little company called Google and their aspirations for Android’s mobile platform. It doesn’t leave much space for a new platform, tied to a low-ranking manufacturer. And again, MSFT is chasing the teens and early adopters with the Kin 1 and Kin 2 – the demo that only wants iPhones, iTouches and apps. Instead of Microsoft relying on their pre-existing trusted relationships in enterprise and the recollection of the versatility of Windows Mobile by corporate IT departments everywhere.

I hope they Kin make this work… but what they need to do, what they’ve needed to do all along, is to take a wheelbarrow full of cash up to Waterloo, Ontario, kiss Jim Balsalie’s ring, and return to Redmond as the owner of RIMM.

It’s hard to consign a once vibrant and innovative company to the technology graveyard, but Motorola is clearly in a death spiral. The company that brought us the StarTAC and DynaTAC cell phones, 6800 and 68000 series microprocessors that powered early Apple, Atari, and Amiga personal computers, invented Six Sigma quality standards, introduced the first high powered germanium transistor, not to mention key developments in television, satellite and space technology is marching toward its inevitable demise.Let’s look at its business units:

Home & Networks Mobility

An entrenched customer base in Cable MSOs, but slow development and long time horizons for installed cable boxes mean that there is not significant demand for product innovation by the cable operators or consumers, and during the downturn, cable is likely to work harder to hold customers, while having a harder time upselling new features such as DVRs etc. Motorola is clearly several generations behind any comparable home entertainment technology standard. Compare the sophistication of a Motorola to AppleTV, a product that, with its peerless DNA, has still struggled to find relevance. I have a Comcast set top box made by Motorola, with a DVR, deployed last August. It sits in a room on top of an 8 year old Sony Home Entertainment DVD/Surround Sound System. 20 feet away, on my stereo rack is a 3 year old Roku Soundbridge. The Motorola box works, but it can’t compete with the Sony or Roku for refinement or product maturity. Any of the display commands on the STB (Play, Pause) are truncated to PLA or PAU – again, this is a 2008 device. Meanwhile the Sony system has a clear, bright, and fully informative display, as does the Roku, where the florescent readout is one of the most elegant in the CE sector… from a company whose market cap is a rounding error in comparison to Motorola.

Enterprise Mobility Solutions

A possible bright spot – less commoditization, and a moat around the core business, but if the housing downturn affects municipality tax bases, then upgrades to police, fire and EMT services will be few and far between – meaning more mileage for the Crown Victoria fleets, and more hours on the existing Motorola scanners. RFID segments could be an opportunity. As the NFL season starts, we’ll be able to again see the ubiquitous Motorola logo on the coaches headsets on the sidelines, reinforced with the company name on the mic. A reassurance that there is, for the moment a pulse in Schaumberg.

Mobile Devices

As Apple and Research In Motion surf the tsunami of smartphone popularity, Motorola’s ship has sunk. Yes, the DynaTAC started the mobile phone revolution, yes, the StarTAC and RAZR were two of the most popular mobile devices of all time. But in Q4 of 2008, Motorola’s market share collapsed by 50%, now down to about 8.7% of the market. The halo around the iPhone and the Blackberry, the momentum of HTC, LG and Samsung will only serve to drive their share even lower in upcoming quarters. Even the Android OS is unlikely to help – cell phones, some 25 years into their lifespan are valued in the consumer market for the form of the device, function follows form. Further, most of the thought leadership that brought the RAZR to market has moved on, and with their market share decimated, Motorola will struggle to find the resources to innovate in R&D. And while Motorola has profited through divestiture of its divisions in the past, they will likely have to pay to unload the mobile unit.

Lastly, much has been made of Sanjay Jha’s compensation package as co-CEO – roughly $104 million, with 103.5 of that tied to equity, bonuses. I applaud the weighting of the compensation toward the success of the company, but imagine that having a co-CEO who is on a package at 25% of Jha’s will inevitably be a cause for turmoil.

With 32 teams in the NFL, you have to ask, just how many headsets would you need to sell to cover 125 million in CEO compensation?