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MOTOROLA CHARTS LIFE AFTER APPLE

IT HAS BEEN A PAINFUL TWO years for Motorola CEO Christopher Galvin. Fierce competition in cellular phones, slower growth in pagers, and a wrenching downturn in semiconductors have left the $28 billion electronics giant reeling. Galvin wasted no time exiting the Mac-compatible PC business Sept. 11, after Apple Computer decided to restrict Macintosh cloning.

So now what? Motorola is redirecting ambitions for its $7.9 billion chip business. Hector de J. Ruiz, new president of the Semiconductor Products Sector, is racing to land Motorola squarely in the systems-on-a-chip market.

His challenge: turn Motorola's thousands of specialty chips into puzzle pieces that customers who make everything from auto engines to laser printers can snap together to perform various functions. It's a tough market, says rival Rick Marz, executive vice-president at LSI Logic. ''This isn't quite like cut, copy, and paste to create a system,'' he says. But with Motorola's chip operations sliding, Ruiz has strong incentives to succeed. Average prices for its bread-and-butter control chips, for instance, have fallen 14% this year, on top of a 12% 1996 dip. And other chips used in cell phones contracted 10% last year despite a 30% market jump.

EDITED BY LARRY LIGHT AND PAT WECHSLER
Gary McWilliams


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Updated Sept. 18, 1997 by bwwebmaster
Copyright 1997, Bloomberg L.P.
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