Motorola Clips Advanced-Video Groups

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As part of a companywide round of layoffs, Motorola has substantially cut back its video-on-demand and switched digital video teams, according to company sources.

About half of the 150 employees in the on-demand video group—from Motorola’s 2006 acquisition of Broadbus Technologies—were let go last month. Most were in the Boxborough, Mass. office.

Meanwhile, 10 of the 26 people in Motorola’s switched digital video group were laid off. The employees, within the cable-focused Home & Networks Mobility unit, were informed of the terminations on Nov. 5.

Motorola declined to comment.

The company announced Oct. 30 that it would lay off about 3,000 employees, or 5% of its workforce, with two-thirds of the pink slips in the unprofitable handset division. Motorola expects the layoffs to save $800 million in 2009, and this week it took the additional steps of freezing U.S. pension plans and notifying employees that many of them won’t be receiving pay raises next year.

Layoffs across Home & Networks Mobility were in line with the company average, according to sources, but the VOD and switched digital areas were more heavily affected.

Many of the VOD engineers laid off were providing overlapping functions with a centralized technical resource support group, according to a Motorola source.

A former Broadbus executive, who left the company more than a year ago, said the restructuring appears consistent with cable industry trends.

“They probably correctly right-sized the business given the current economic climate,” the executive said. “Throughout the industry there’s a pullback on VOD and switched digital, absolutely.”

Motorola entered the VOD market in July 2006 with the $181 million acquisition of Broadbus, a startup that had developed high-performance VOD systems that use dynamic random-access memory rather than traditional disk storage.

In September 2006, the company bought Vertasent, a 15-employee firm that developed resource management software for switched digital video and VOD, for an undisclosed price.

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