Motorola in $200m bid for Psion

Motorola Solutions has made a bid to acquire ruggedised mobile device manufacturer Psion for approximately £128m ($200m). The firm, which is the part of Motorola not acquired by Google, said it wanted to buy Psion to strengthen its mobile-computing portfolio with ruggedised handheld products and vehicle-mount terminals.

Psion has focused on mobile computing solutions since its inception in 1980; it had been a pioneer of PDA devices and had contributed most of the technology to the Symbian mobile platform. It is headquartered in London, has around 830 employees and delivered  revenues of £176 million in 2011.

John Hawkins, chairman of Psion, said that the firm’s directors recommend this offer as the price offers a significant cash premium to both the current and recent market prices.

According to David McQueen, principal analyst at Informa Telecoms and Media, it is likely that the move is an attempt by Motorola Solutions to safeguard its fortunes in business market, which is being eroded by the rise of consumer technology players, such as Apple and Google, whose tablet devices are being increasingly used by business users.

“The problem with tablets is that they’re not really ruggedised and security is an issue,” he explained. “Taking an iPad or Android tablet into the office causes a headache for the CTO, because there’s very little security on them.”

He added that this makes ruggedised devices much better suited to work environments such as contruction sites and in-taxis. With business users are bringing different devices into the workplace, with differing screen sizes, operating systems and even different versions of the same device, enterprises need to ensure that they’re all secure, as there is often a lot of sensitive information on them.

“This [deal] might create more of a cost-effective way for a business to do this,” said McQueen. “Tablet devices are still not cheap and this may be a cheaper way of getting ruggedized devices into enterprises in a secure and unified manner.”

However, he cautioned that by acquiring Psion, Motorola Solutions may only be focusing on its short-term future.

“If they can get more control over the devices that go into vehicles and enterprises, that gives Motorola more time before the market catches up; sooner or later, in-vehicle computers will be built in and more tablets that are secure and ruggedised will enter the market,” he warned.