In our del.icio.us feed the other day, I linked to a story about a report from Richard Windsor, an analyst for investment bank Nomura, in which he raised the possibility that Motorola might get out of the handset business. I think Richard is about the best of the bunch of stock analysts following the mobile industry, so when he says something, it’s worth paying attention to. But I was slightly skeptical of this, just because I couldn’t see how selling the business would really help.

Cue Motorola’s announcement a day or two later that it, indeed, is examining options for its handset business, including a spinoff or a sale. This news shouldn’t be that surprising, given what a drag the handset business has been on Moto’s share price, and the fact that this mess has been unfolding like a slow-motion train wreck for oh, two and a half years or so.

But will a sale happen? I’m not certain. On the one hand, if Motorola gets a decent offer from somebody, I am pretty confident that they’ll sell out, since taking in several billion dollars is a much more attractive prospect than having to spend several billion to fix the unit. On the other, a sale in and of itself won’t fix what is a very broken business. Asian vendors are being named as possible candidates, but it’s hard to see how they’d help Moto work out its problems, since they face many of the same issues themselves (furthermore, see the takeovers of Siemens’ and Alcatel’s handset units by Chinese vendors). Private-equity firms are also getting a shout, but that seems pretty unrealistic, since there aren’t any assets worth stripping out, and they won’t want to pump in the money to fix the business.

Windsor says the best move would be for Moto to spin off the unit, and make it a separate business that could still sell handsets under the Motorola brand. That’s a likely possibility, but again, just the deal and the relief it might bring shareholders won’t fix the business. If the business is spun off, it’s still going to need a major shakeup. If the unit gets spun out with no management or strategic change, how can it fare any better?

The problem is in the products. Motorola rode the RAZR for too long, and missed out on, essentially, an entire generation of innovation. It’s shown some glimpses of potentially decent products, like the Z10, which uses the UIQ platform, and its new E8, which has an interesting interface that shows only music control buttons in music mode, and only shows camera buttons in camera mode. But those are just two handsets out of a whole range of mediocrity — and mediocrity that’s being manufactured at higher costs and lower margins than those enjoyed by Motorola’s rivals. Whatever financial solution Motorola pursues, until the products change, its miserable fortunes will stay the same.