Motorola's flashy, innovative new pagers are beeping the world


Just across the canal from an old cow pasture in Boynton Beach, Fla., one of the country's most successful factories is proving that Americans still know how to build a product and bully the world with it.

Motorola Inc. has turned Boynton Beach into the world's wellspring for electronic pagers. This plant first turned out pagers in 1984; these days, the plant hums around the clock, manufacturing more than 11,000 a day.

The success of Motorola's Paging and Telepoint Systems Group flies in the face of the belief that U.S. manufacturing is in its twilight. Unlike U.S. electronics companies that frittered away their supremacy in world markets, Motorola manages to sell four of every five pagers in the world, and most of them are made in Boynton Beach. There's no sign of letting up.

"Their order rates are up probably along the order of 35 percent-plus for the first six months of the year," said Tony Langham, an analyst for County NatWest Securities USA in New York. "My sense is that their profit margins are up as well."

Motorola's fortunes in Boynton Beach are by no means tied only to beeping boxes. In July, Motorola began selling a paging service, called Embarc, that allows users of portable computers to receive news, electronic mail and other information over radio waves.

A short drive away, a sister plant in Plantation, Fla., is developing a new breed of portable telephones that has reached parts of Europe and Asia. Less costly than their cellular relatives, the phones allow people to make calls from home, work and from such public places as malls and government buildings, but not from in between. The Federal Communications Commission expects to issue the first operating licenses in the United States in 1993.

These projects have made the Paging and Telepoint Systems Group one of Motorola's fastest-growing business units and one of southern Florida's fastest-growing employers.

In the past 18 months, the Boynton Beach plant has grown to 2,400 employees from 1,900, and morale appears to be high. Employees recently received cash bonuses of 15 percent of their six-month pay because of the division's success in the first half of 1992. Roughly 65 percent of Motorola pagers are assembled in Boynton Beach, with the rest in Singapore.

Motorola, based in Schaumburg, a Chicago suburb, generated $11.3 billion in sales last year from communications products, semiconductors and computer components.

In recent years, its semiconductor and cellular-telephone businesses have driven the company's growth and profit, but its focus is on communications, regardless of whether people or machines are doing the talking.

In addition to pagers and cellular telephones, Motorola makes two-way radios, satellite communications systems, computer networking products and components for "smart" vehicles of the future.

Motorola's net earnings dropped 9 percent in recessionary 1991, but profits were up 16 percent in the first half of 1992.

Running the show in Boynton Beach is 26-year Motorola veteran Robert Growney, a Chicago native who restores old Corvettes in his spare time. Mr. Growney attributes the division's success to demand, but there is more to it than passively taking orders. Motorola's new products and innovative marketing have whetted appetites for more.

A year ago, Motorola pagers came in basic black and were perceived by many as obnoxious trinkets for overachievers. Today, Motorola is offering bright colors, splashy custom designs and a choice of alarms, including the opening bar of Beethoven's Fifth Symphony. A model due out soon will be the size of a credit card.

For a gadget invented in the 1950s, pagers are enjoying a belated adolescence. The typical numeric display pager costs as little as $79, down from about $200 five years ago, and air time runs from $10 to $15 a month. Children are using them to keep in touch with parents and each other during school and at night.

Other pagers take more concealed forms. Motorola's Wrist Watch Pager, now 2 years old, looks like a black digital watch.

"The pager business is very strong right now around the world, with the exception of Japan," said Mr. Growney, 51. "Even in the recession, we consistently had 20 percent growth per year."

Products weren't the only ingredient to change in Motorola's marketing strategy. Retailers are carrying Motorola pagers now, making them more accessible.

In late July, Motorola launched the first of its Embarc products, a pager that attaches to personal computers. For $395 initially and $15 a month for unlimited air time, customers can receive sections of USA Today and up to 1,500 characters of information at a time from the sending computer. The product, called NewsStream, is available in 116 cities.

The CT2, or Telepoint, a cordless telephone in use in the Netherlands, Hong Kong, Singapore, Thailand and Malaysia, will be available in Britain later this summer.

The new phones will fit neatly, in capability and price, between home cordless phones and cellular phones. Monthly service fees are expected to be $15 to $20, about one-fifth the cost of cellular service.

Motorola has about 50,000 CT2 phones in service, all made in Malaysia.

"Folks have a very large appetite for untethered communications," Mr. Growney said. "When you get a phone call at your desk, the phone call goes to the desk, not to you."

David Yedwab, vice president of Eastern Management Group, a research firm in Parsippany, N.J., said CT2 could be used by as many as 20 percent of Americans by 2000. He said the phone probably will cost about $100, a 10th the price of the early cellular phones.

"The cellular experience taught us that before this market really takes off, the price point that people are willing to stand will have to be more like the home telephone," Mr. Yedwab said.

Mr. Langham of County NatWest Securities said wireless personal communication is destined to become a major phenomenon. Motorola, he said, will benefit most.

"I think it's in the process of blowing wide open around the world," he said. "Motorola's No. 1. That's been their business for 50 years, and now all of a sudden what was a basic business is about to become a worldwide industry."

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