Inc Motorola - Early History

EARLY HISTORY

The foundation for Motorola was laid when Illinois residents Paul V. Galvin and Edward Stewart founded a storage battery company in 1921. Although the U.S. government shut the new business down in 1923 for failure to pay excise taxes, operations continued when Stewart opened a new storage battery firm, named Stewart Storage Battery Co., in 1926. When the growing popularity of electric power undercut battery sales, Steward devised the "battery eliminator," a converter that allowed a battery-operated radio to plug into a wall outlet. The new product wasn't enough to keep the firm from insolvency; however, Galvin and his brother acquired the battery eliminator operations from the bankrupt firm, and they later incorporated the business as Galvin Manufacturing Corp.

Galvin began working on a new car radio receiver in 1929. The following year, the firm introduced the world's first commercially viable car radio. The product was named Motorola, a combination of the words of "motor" and "victrola." Motorola continued to lead the U.S. automobile radio industry into the 1930s. After a trip to Europe in 1936, Galvin recognized the likelihood of war and began preparing his firm for such an event. For example, he oversaw the development of the "Police Cruiser," a radio designed to receive police broadcasts. The firm diversified into home radios in 1937; at that time, more than half of all American households owned radios. B. F. Goodrich Co. became the first national Motorola dealer that year.

Galvin Manufacturing launched its first major advertising campaign, which included print ads, billboards, and road signs, in 1938. Two years later, the company created a hand-held, two-way radio, known as the "handie-talkie," for the U.S. military. Believing that radio communication products would be increasingly called upon to enhance military efforts, Galvin created a separate communications products division. Sales that year reached nearly $10 million.

In 1941, the company established Motorola Communications and Electronics, Inc. as its sales subsidiary. The first two-way FM radio communications products, which offered increased range and quieter operation, were introduced. Galvin Manufacturing completed its initial public offering in 1943, selling its share for $8.50 each. That year, Researcher Dan Noble developed the first portable two-way FM radio, known as the "walkie-talkie." Both the "walkie-talkie" and the "handie-talkie" played an integral role in U.S. military field communications during World War II. When the war ended, the firm renewed its development of electronic products for consumers.

Galvin Manufacturing officially adopted the Motorola name in 1947. The firm also purchased Detrola, a supplier of car radios to Ford Motor Co. Other major car radio clients included Chrysler and General Motors. Motorola diversified into televisions in 1948 with the launch of the Golden View VT71. Priced at $179, more than 100,000 unit were sold by the end of the year. As a result, Motorola became the fourth-largest television manufacturer in the nation. In 1949, the company established a research and development facility, headed by Dan Noble, in Phoenix, Arizona. By focusing on transistors, Noble played a major role Motorola's emergence as a leader in the worldwide semiconductor industry. Motorola also released a two-way FM radio communications equipment line which made us of the increased number of radio frequencies.

Developments during the early 1950s included a three-amp power transistor and a color television set, which proved problematic. The set was criticized for technical glitches and its high price. Limited color programming from broadcasters also posed a problem at the time. In 1956, the firm pulled its color television from shelves. A small car radio was the first commercial Motorola product to use transistors. The firm also unveiled a small radio receiver, called a pager, which was used mainly by hospitals. The first fully transistorized two-way radio was shipped in 1959; it became one of the firm's best selling products. Motorola unveiled its first portable transistor radio at roughly the same time. Competition heated up as several foreign radio manufacturers begin gaining market share.