Motorola Outsourcing

Date: Tuesday, February 18, 2003 9:17 AM

H-1B and JOB DESTRUCTION NEWSLETTER

www.ZaZona.com

One of the reasons companies like Motorola bring in H-1Bs and L-1s is
to train them in the US. Once they have sufficient training the
companies can then move their entire departments overseas. A Motorola
spokeman hinted at this procedure when he said that some of the
existing employees of Motorola working in its IT departments could be
transferred to the outsourced facilities in India.

The following articles indicate that Motorola intends on outsourcing an
unprecedented amount of their business overseas.

American news media hasn't picked these stories up yet. The first
article is from India and the second from London. How could news
agencies in the US miss a story this big?

http://www.financialexpress.com/fe_full_story.php?content_id=28061

Motorola Dials India To Farm Out End-to-end IT Operations

Ashu Kumar

New Delhi: In what could turn out to be one of the biggest outsourcing
deals in recent times, global telecom giant Motorola is planning to
outsource its complete IT operations to India. The project is estimated
to be worth over $100 million spread across 2-3 years.

According to sources, Indian software services majors including Infosys
and Wipro Technologies are the front runners in the race to win the
project.

When contacted, a senior Motorola global executive who was recently in
India confirmed that the company was in the process of outsourcing its
IT operations. I know that some of the Indian companies have been
shortlisted for the final round of discussion but I cannot give you any
more details as I am not directly involved with the project, he said on
condition of anonymity.

The sources said that the request for proposal (RFP) for the project
was made by Motorola some time late last year. The first round of
technical evaluation of outsourcing partners is already over and the
final proposals have recently been submitted by shortlisted companies.

The final decision about the selection of outsourcing partner will be
made by Motorola sometime in the second quarter of this calender year.

The project, according to sources, will result in an
onsite-cum-offshore facility of around 500-1,000 people and Motorola
may select more than one outsourcing partner to execute the project.

The worldwide IT operations of Motorola include software development,
systems integration, technology management, network and system
management and maintenance and other related services.

The sources said some of the existing employees of Motorola working in
its IT departments could be transferred to the outsourced facilities of
the partner while the company will keep control of the management staff
responsible for the outsourced operations.

Once outsourced to an Indian company, this will be one of the largest
IT services projects outsourced to India by a global maufacturing
company. It will be a complete end-to-end IT operations outsourcing
deal that will pave the way for similar projects from multinational
manufacturing firms.

A similar project was also being outsourced to India by Pepsi late last
year. Sources said the project worth over $100 million was being
finalised in favour of EDS and Wipro Technologies to be executed
jointly. However, the deal was put on hold by Pepsi later for some
internal reasons, said sources.

http://www.e-insite.net/eb-mag/index.asp?layout=article&articleid=CA277013&spacedesc=news

Motorola May Outsource 50% of Chips

By David Manners -- 2/14/2003
Electronics Weekly

Motorola Inc.'s Semiconductor Products Sector may outsource half of its
IC production to foundries this year, according to Louis Ting, general
manager of the companys semiconductor business in Taiwan.

For some years, Motorola has been thought to be foundry Taiwan
Semiconductor Manufacturing Co. Ltd.s biggest customer. However,
Ting said its foundry business would be given to two companies -- TSMC
and United Microelectronics Corp. -- the two largest foundries in the
world.

Late last year, Motorola was thought to have only 10 percent of its
production out at foundry. However, in late 2002, company chairman Fred
Shlapak said that Motorola was adopting an "asset-lite" strategy.

As well as putting outsourcing production, Motorola is co-developing
its own processes, one example is the STMicro/Philips/Motorola alliance
at the Crolles fab in France.

Electronics Weekly is the London-based sister publication of Electronic
News.

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