With sales of $10.1 billion last year, a third of its total, the home and networks business is among Motorola’s (MOT) largest and most profitable. It also makes Motorola one of the top three set-top box manufacturers in the industry. As such, the division will command a hefty price–roughly $4.5 billion, according to The Journal, which posits private equity firms and other communications gear makers as possible buyers.

No word yet on whether the possibility of selling home and networks emerged after Motorola was unable to spin off its mobile-phone business. The company for its part, insists that such a move is still in the cards.

“Separation into two independent, publicly traded companies (Mobile Devices and Broadband Mobility Solutions, which comprise Enterprise Mobility Solutions and Home and Networks Mobility Solutions) is the publicly stated long-term goal of Motorola,” the company said in a statement. “We remain committed to the separation goal and continue to believe that it is the right strategy to position Motorola for long-term success.”

According to News.com, 100 people or so lined up outside Verizon’s midtown Manhattan store last night prior to its midnight opening. And various reports posted to Twitter suggest there were queues at other outlets as well, though quite a bit shorter (see below; click to enlarge).

In any event, the fact that there are lines at all must be a welcome sight for Verizon (VZ), which has been looking for a strong rival to Apple’s (AAPL) iPhone, and for Motorola (MOT), which hopes Droid will revive its much-diminished post-Razr cellphone business. As one Verizon subscriber eager to trade up to Droid told me, “it’s the best smart phone not made by Apple.”

With endorsements like this, Motorola should be working a bit harder on branding the device as its own. Right now, the Droid marketing push from Verizon Wireless is so overwhelming that you’d think CEO Lowell McAdam designed it himself. Why aren’t we hearing from Motorola as well?

“Droid is potentially a game changer for Motorola,” iSuppli analyst Tina Teng said in a recent research note. “Motorola now is no longer just emphasizing slick form factors, such as it did with its RAZR handset. The company now has focused on the hottest segment of the global mobile handset market–providing compelling smartphone products that are usable and expandable through third-party applications.”

That being the case, Motorola might want to do a bit more to get its name out there.

Not the prettiest of quarters, but that penny-a-share profit beat the consensus estimates of analysts, who had expected the company to simply break even.

“We delivered on our commitment to improve the financial performance of Mobile Devices and to commercially launch two smartphones in time for the fourth-quarter holiday season,” Sanjay Jha, co-CEO of Motorola and CEO of Mobile Devices, said in a statement.

“The introductions of our new products powered by Android,” Jha continued, “are important milestones as we begin to address the mobilization of the Internet and the growing demand for modern smartphones. Next year, we will continue to expand our smartphone portfolio and deliver improved financial results.”

Glad those layoffs are paying off for someone.

Which is not to say that Motorola’s suffering is over. Sales at the company’s struggling wireless division dropped a precipitous 46 percent to $1.7 billion. Its estimated global market share is now 4.7 percent, compared with 8.4 percent it claimed in 2008. An ugly decline indeed.

That said, with some strong new Android handsets in the pipeline, things are beginning to look up for Motorola (MOT). At $8.44, company shares are trading up six percent this morning.

Consensus seems to be that the Droid is the device that will get Motorola back into the game. Indeed, Technology Business Research’s Ken Hyers says the Droid is likely a “serious challenger to the iPhone.”

Over at RBC Capital Markets, Mark Sue says good things as well. “The Droids are coming and Motorola will be an important part of Verizon’s push for smartphone differentiation,” he wrote in a note to clients Wednesday. “In addition to compelling products, Motorola seems to have gotten back into the good graces of the North American carrier federation, which should aggressively push the new devices.”

Of course, these endorsements don’t necessarily mean that Motorola is poised to return to its past glory. And they certainly don’t guarantee the Christmas turnaround the company is clearly hoping for. After all, the smart-phone market is far more competitive now than it was when Motorola last dominated it back in 2004.

Said Morningstar analyst Joseph Beaulieu: “[I’m not sure the Droid] will be good enough to cut through the noise that you’re getting from Apple iPhone, HTC’s Hero, Research In Motion’s BlackBerry and even Palm’s Pre and upcoming Pixi.”

Consensus seems to be that the Droid is the device that will get Motorola back into the game. Indeed, Technology Business Research’s Ken Hyers says the Droid is likely a “serious challenger to the iPhone.”

Over at RBC Capital Markets, Mark Sue says good things as well. “The Droids are coming and Motorola will be an important part of Verizon’s push for smartphone differentiation,” he wrote in a note to clients Wednesday. “In addition to compelling products, Motorola seems to have gotten back into the good graces of the North American carrier federation, which should aggressively push the new devices.”

Of course, these endorsements don’t necessarily mean that Motorola is poised to return to its past glory. And they certainly don’t guarantee the Christmas turnaround the company is clearly hoping for. After all, the smart-phone market is far more competitive now than it was when Motorola last dominated it back in 2004.

Said Morningstar analyst Joseph Beaulieu: “[I’m not sure the Droid] will be good enough to cut through the noise that you’re getting from Apple iPhone, HTC’s Hero, Research In Motion’s BlackBerry and even Palm’s Pre and upcoming Pixi.”

T-Mobile USA has priced the handset at $199 with a two-year contract, which seems a bit dear considering you can get a 16GB iPhone 3GS for the same price. Given $200 to spend and the choice between Motorola’s first-ever Android device and the first iteration of its Motoblur social networking service or Apple’s (AAPL) third-generation iPhone and second-generation mobile OS and App Store, what would you opt for?

How might your choice change if the Cliq were priced at $150?

[Image credit: LeakDroid]

Why? Well, the CLIQ, or DEXT as it will be confusingly branded in the U.K., incorporates Motorola’s new “MotoBlur” service, which essentially corrals Facebook, MySpace, Twitter, Picasa, GMail and MS Exchange activity into a single feed and presents them on your phone.

In form, the CLIQ is a sideways slider. Like the Palm (PALM) Pre, the device boasts a full touchscreen and QWERTY keyboard. It’s got a 320 x 480-pixel, 3.1-inch HVGA screen and a five-megapixel camera. The CLIQ is video-capable (play, stream and capture) and supports the broad spectrum of media formats. It runs Android 1.5 (Cupcake), and Motorola (MOT) claims a battery life of six hours.

Jha says the phone is not intended to be a single iconic device–like, say, Apple’s (AAPL) iPhone. Rather, it is the first of a broad line of handsets, all running Android and Motoblur, that will be targeted at different customer segments around the world.

A wise strategy in the current market? Who knows? But at least it’s a step in the right direction. Motorola clearly needs to do something to right itself after the past few disastrous years. Hard to believe the company controlled 16.1 percent of the global handset market just two years ago. It’s market share today? A modest 6.5 percent. The CLIQ will be sold through T-Mobile in the United States.

The device’s spec sheet below; click to enlarge.

“We expect Motorola’s 2010 performance to hinge largely on the success of Android models debuting in 4Q09. Just months ago, the expected launches were ‘Morrison’ for T?Mobile, ‘Sawgrass’ and ‘Heron’ for AT&T, and ‘Sholes’ and possibly ‘Calgary’ for Verizon” (VZ), Kuittinen said in a note to clients. “We believe the AT&T models have been canceled, and Verizon has pushed ‘Calgary’ into 2010.”

According to Kuttinen, “The loss of AT&T’s support for 4Q09 changes the winter outlook for Motorola dramatically. It is likely that the success of the $99 iPhone, combined with the possible November launch of the $99 Palm Eos could put AT&T in a situation where its $100 smartphone range for the Christmas quarter is already full of models featuring very advanced software and display technology.”

A worrisome turn of events and one that will weigh heavy on Motorola’s financials if it proves true. Said Kuittinen: “The narrowing of Motorola’s Android plans may have a substantial impact on the winter performance of the company’s handset division precisely because Motorola needs a rapid roll?out of a wide range of follow?up models for its ailing RAZR, Q and Z series models.”

“We expect Motorola’s 2010 performance to hinge largely on the success of Android models debuting in 4Q09. Just months ago, the expected launches were ‘Morrison’ for T?Mobile, ‘Sawgrass’ and ‘Heron’ for AT&T, and ‘Sholes’ and possibly ‘Calgary’ for Verizon” (VZ), Kuittinen said in a note to clients. “We believe the AT&T models have been canceled, and Verizon has pushed ‘Calgary’ into 2010.”

According to Kuttinen, “The loss of AT&T’s support for 4Q09 changes the winter outlook for Motorola dramatically. It is likely that the success of the $99 iPhone, combined with the possible November launch of the $99 Palm Eos could put AT&T in a situation where its $100 smartphone range for the Christmas quarter is already full of models featuring very advanced software and display technology.”

A worrisome turn of events and one that will weigh heavy on Motorola’s financials if it proves true. Said Kuittinen: “The narrowing of Motorola’s Android plans may have a substantial impact on the winter performance of the company’s handset division precisely because Motorola needs a rapid roll?out of a wide range of follow?up models for its ailing RAZR, Q and Z series models.”

Interestingly, HTC recently said that its 2009 revenue would decline, after earlier forecasting a 10 percent increase. The reason for the fall? Delays in product launches.

Coincidence? Tough to say. One thing’s certain, though: If the Lancaster has been delayed or ends up being scrapped, it’s bad news for HTC, which will soon face increased competition from Motorola (MOT), Sony Ericsson and other handset vendors developing phones for Google’s (GOOG) Android.

Interestingly, HTC recently said that its 2009 revenue would decline, after earlier forecasting a 10 percent increase. The reason for the fall? Delays in product launches.

Coincidence? Tough to say. One thing’s certain, though: If the Lancaster has been delayed or ends up being scrapped, it’s bad news for HTC, which will soon face increased competition from Motorola (MOT), Sony Ericsson and other handset vendors developing phones for Google’s (GOOG) Android.

Motorola’s explanation for the shortfall? The company doesn’t seem to have one, although it says it’s looking forward to launching a more “differentiated” handset lineup later this year. During a conference with analysts, Motorola co-CEO Sanjay Jha said the company plans to bring a number of devices running Google’s (GOOG) Android mobile OS to market in the months ahead.

“We will have two Android devices by the holidays,” said Jha. “And we have plans for more devices in the first quarter of 2010.” These will get the company “back in the game in smartphones,” Jha added, noting that most of the devices the company plans to launch next year will fall under that category. “Our core strategy really is to take Android as low down on the feature-phone tier as we possibly can,” he said.

For Motorola, which has been losing money and market share for longer than anyone cares to remember, that’s a wise move. A killer Android handset at a reasonable price would do much to carry the company toward its hoped-for turnaround. But as Avian Securities analyst Matt Thornton notes, developing such a device is no easy task when a number of other handset makers are building Android devices as well.

“Motorola made the right choice and the only choice with Android,” Thornton said. “It remains to be seen how Motorola will differentiate itself from its competitors.”

Both devices are said to feature a touchscreen and slide-out keyboard and a “social communications” focus. Which sounds somewhat compelling, though it would probably be more so if the market weren’t already enamored with Palm’s (PALM) Pre, Apple’s (AAPL) iPhone 3GS and its $99 brethren, the iPhone 3G. That said, I suppose there’s always a chance that Motorola (MOT), using Android, could turn out a handset that apes those devices and returns the company to the glory days of the RAZR or at least points it in the right direction.

Certainly, Motorola desperately needs something like that. A weak product portfolio has already reduced its share of the handset market to 6.5 percent, about half what it held a year ago. And with the econalypse in full swing and consumer spending declining, Motorola’s prospects in the mobile handset don’t appear very promising.

Motorola’s mobile device division’s operating loss grew to $509 million as sales plummeted 45 percent to $1.8 billion. That’s an improvement over the $595 million the division lost in the fourth quarter of 2008, but again, that’s not saying much. Sure, cost cuts are making a difference, but how much of a difference is that, really, when your handset shipments have been halved in the last year?

And there’s more cause for concern. Motorola’s home entertainment and emergency-response communications divisions, which have bolstered its earnings in the past, have also begun to suffer. The econalypse undermined sales and profits in both divisions in the first quarter. End result: a net loss for the company of $231 million, or 10 cents a share, on revenues down about 28 percent to $5.37 billion from $7.45 billion a year ago. Excluding charges, that loss came in at eight cents. That’s better than analysts’ averaged loss forecast of 11 cents, but again given what I’ve outlined above, it’s not saying much.

For the second quarter, Motorola believes it will loses three cents to five cents a share. The Street’s expecting a loss of five cents a share.

In other words, Liska has filed a whistleblower lawsuit against Motorola (MOT). He’s claiming he lost his job for doing something in the public interest.

On what basis he’s making that claim is not yet clear, and the lawsuit is sealed, so there’s nothing to be learned from court documents. Still, a curious turn of events in an already curious situation. And bad news for Motorola. An accusation of retaliatory discharge made by a former CFO doesn’t exactly cast the company in a good light.

Former Motorola CFO Paul Liska thought he’d been let go because the company was postponing the spinoff of its cellphone unit. Imagine his surprise when he read in Crain’s Chicago Business that he’d actually been fired for cause.

In a recent SEC filing, Motorola (MOT) said Liska was “involuntarily terminated for cause” and therefore must repay his $400,000 signing bonus and forfeit the stock options he received when he signed on with the company.

An odd disclosure, given the way in which Motorola’s leadership handled Liska’s departure. Asked about the circumstances surrounding his exit on a Feb. 9 earnings call, Motorola co-CEO Greg Brown had this to say:

“[Paul] did a lot of good work here and helped us get a lot of the heavy lifting done around this separation and preparation for separation which–as we talked about–remains the commitment to our strategy going forward and he was also very helpful in getting after along with the businesses and the other leaders in the organization, cost reduction initiatives. That said, I think the business environment’s changed, and given the environmental changes, we thought the change was appropriate at this time as well in that position.”

If that was the case, why was he fired for cause, which Motorola defines as–among other things–”willful and continued failure to substantially perform duties” and “gross misconduct”?

We may soon find out. Liska has reportedly filed suit against Motorola for wrongful termination.

[Image credit: Someecards]

Former Motorola CFO Paul Liska thought he’d been let go because the company was postponing the spinoff of its cellphone unit. Imagine his surprise when he read in Crain’s Chicago Business that he’d actually been fired for cause.

In a recent SEC filing, Motorola (MOT) said Liska was “involuntarily terminated for cause” and therefore must repay his $400,000 signing bonus and forfeit the stock options he received when he signed on with the company.

An odd disclosure, given the way in which Motorola’s leadership handled Liska’s departure. Asked about the circumstances surrounding his exit on a Feb. 9 earnings call, Motorola co-CEO Greg Brown had this to say:

“[Paul] did a lot of good work here and helped us get a lot of the heavy lifting done around this separation and preparation for separation which–as we talked about–remains the commitment to our strategy going forward and he was also very helpful in getting after along with the businesses and the other leaders in the organization, cost reduction initiatives. That said, I think the business environment’s changed, and given the environmental changes, we thought the change was appropriate at this time as well in that position.”

If that was the case, why was he fired for cause, which Motorola defines as–among other things–”willful and continued failure to substantially perform duties” and “gross misconduct”?

We may soon find out. Liska has reportedly filed suit against Motorola for wrongful termination.

[Image credit: Someecards]

For Motorola, which is under enormous financial stress these days, the sale of Good will help stem its losses a bit and focus its attention on its struggling mobile handset division. It will also unburden the company of the legal expenses surrounding the patent infringement suit Visto filed against Good in 2006. “Good was either going to fade away or be given to someone,” Gartner analyst Ken Dulaney told The Wall Street Journal. “They get rid of a failed business, take some employees off the books and end a lawsuit.”

As the table above (click to enlarge) clearly shows, Motorola’s handset business is fast deteriorating, with fourth-quarter sales plummeting 51 percent.

And it’s only going to get worse. A weak product portfolio has already shorn Motorola’s share of the handset market to 6.5 percent–about half what it held a year ago. And with no strong product offerings until late 2009/early 2010 and consumer spending declining, Motorola’s prospects in the mobile handset sector look lousy. “They better hurry and fix mobile devices or it will become irrelevant,” said RBC Capital Markets analyst Mark Sue. Goldman analyst Simona Jankowski agreed: “I feel their position in handsets is awful and will get worse,” she told Reuters.

Indeed, as Global Crown Capital analyst Tero Kuittinen notes, Motorola’s entire handset portfolio is in disrepair. “Media keeps focusing on the high-end trouble–and Lord knows their luxury line-up is a hot mess,” said Kuittinen, who describes the company’s phone problems as “gruesome.” “But the real issue here is Motorola’s aging mid-range and low-end portfolios, particularly the senescent W-series, which is their big volume driver. Nokia executed an aggressive low-end revamp in the second half of 2008–bringing features like a megapixel camera and QVGA display to notably low price points. Motorola’s mass market models are looking heavy, boring and outdated in comparison. Redesigning the low-end portfolio is extremely expensive–particularly if you have to redesign the high end at the same time. I think it’s this issue that may become insurmountable for Motorola.”

So perhaps its time for Motorola (MOT) to do the inevitable: shutter its mobile devices division. After all, there’s no way it’s going to spin it off during this recession.

Said Kuittinen, “Shutting down the handset division would be incredibly painful and would happen only when every other option is ruled out. But the other two options are becoming increasingly unlikely. They really tried to sell or merge the handset unit a year ago–no takers in China or Japan while those economies were still doing OK. The other option would be to turn around the handset business. But they seem to be pulling back from the low-end market and withdrawing into mid-range and high-end. That’s a tough trick to pull off, because they have almost no high-end business left and running the mid-range portfolio alone is something no company has ever done successfully. Motorola’s volumes are getting too small to support a global business.”

The company today posted a $3.6 billion loss in the fourth quarter, suspended its dividend and projected further losses in the first three months of 2009. Motorola now sees a first-quarter loss of 10 cents to 12 cents a share. Analysts polled by Thomson were forecasting a six-cent loss.

Worse, phone shipments in the company’s cellphone division–crucial to turnaround plans–fell by half last quarter. Motorola (MOT) shipped about 19.2 million handsets in the fourth quarter, compared with about 41 million in the year-ago period. Clearly, the touchscreen Krave has done little to revive the company’s flagging post-Razr cellphone business.

On top of this bad report, Motorola has just announced the departure of its chief financial officer, with no official reason given.

“It’s an indication of how much financial stress this company is under right now, and there’s more to come,” said JMP Securities LLC analyst Samuel Wilson. “Their handsets right now are stagnant, and there’s no sign of a new product cycle coming until maybe the end of the year.”

Another ugly turn for a company that’s taken quite a few of them recently–Motorola shares have fallen more than 60 percent in the last year. And they seem destined to fall further still in the months ahead.

The company today posted a $3.6 billion loss in the fourth quarter, suspended its dividend and projected further losses in the first three months of 2009. Motorola now sees a first-quarter loss of 10 cents to 12 cents a share. Analysts polled by Thomson were forecasting a six-cent loss.

Worse, phone shipments in the company’s cellphone division–crucial to turnaround plans–fell by half last quarter. Motorola (MOT) shipped about 19.2 million handsets in the fourth quarter, compared with about 41 million in the year-ago period. Clearly, the touchscreen Krave has done little to revive the company’s flagging post-Razr cellphone business.

On top of this bad report, Motorola has just announced the departure of its chief financial officer, with no official reason given.

“It’s an indication of how much financial stress this company is under right now, and there’s more to come,” said JMP Securities LLC analyst Samuel Wilson. “Their handsets right now are stagnant, and there’s no sign of a new product cycle coming until maybe the end of the year.”

Another ugly turn for a company that’s taken quite a few of them recently–Motorola shares have fallen more than 60 percent in the last year. And they seem destined to fall further still in the months ahead.