These days, when people think about phones and other communication technology, Motorola is not likely the first brand that comes to mind. That wasn’t always the case. In the pre-consumer smartphone days. Motorola was a major player in the United States and abroad. In a lot of ways, the brand is still a top contender, though overshadowed in the U.S. market by brands like Apple, Samsung, and Google.
Now, Motorola is in the news again, but not in a way the company bigwigs would prefer. Acting on a tip from stock trader turned corporate whistleblower, Andrew Left, the Trump administration was tasked with responding to assertions that Motorola was price gouging. That accusation would be bad enough, from a public relations perspective. But, they’re not just gouging the general public, the company has been accused of charging ridiculously high rates to police, fire and sheriff’s departments.
According to the letter, as reported by multiple media outlets, Motorola sells radios to U.S.-based first responders for five times what it charges for the same radios in Britain. The letter goes on to say that Motorola makes three-quarters of its total profit in the United States, much of it, apparently, on the backs of U.S. taxpayers.
In the letter, Left asks: “What would President Trump think…” an ominous question given Mr. Trump’s direct style in dealing with corporations that attract his ire. Think about what happened when Trump decided Boeing and Lockheed Martin were overcharging customers. Direct confrontation, trial by media and a short, harsh stare down.
Left doesn’t appear to be too committed to throwing Motorola under the bus. He just seems to be responding to the new normal of a POTUS who jumps right in the middle of any scenario that attracts his attention.
After Fortune Magazine reported on Left’s letter, Motorola was quick to respond, saying:
“We strongly disagree with the assertions made by this short-seller… comparisons to products and price points in Europe and other locations are baseless, as different countries have different standards and require different technologies. We sell radios at all price points in each region…”
That may not happen. Motorola, as stated earlier, is not nearly the consumer force it once was. The brand recognition is there, but still a shadow of what it once was. This could be a PR opportunity for the brand to get its name out there and front of mind for consumers again by extrapolating on the assertions they made in their rebuttal. If they can show their work and prove their prowess and fairness, they not only discredit to criticism but also build their own platform for resurgence.
David Milberg is a financial analyst in NYC with nearly 3 decades of experience in the finance industry. He is a long-time owner of Milberg Factors, a factoring and finance company with locations in New York, California, and North Carolina.
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