Google Buys Motorola For $12.5 Billion(techcrunch.com)
techcrunch.com
Google Buys Motorola For $12.5 Billion
http://techcrunch.com/2011/08/15/breaking-google-buys-motorola-for-12-5-billion/
369 comments
Only part of Motorola, and not generally the part considered the "original". :)
Motorola mobility was spun off of the main company in January - I think at the time there was commentary on the stock markets that it was done with the aim to get someone to buy it.
So Motorola will exist still - as Motorola Solutions (it is the bigger & more profitable part of the company anyway) and Google get a phone manufacture division under their control.
Interesting move.
Motorola mobility was spun off of the main company in January - I think at the time there was commentary on the stock markets that it was done with the aim to get someone to buy it.
So Motorola will exist still - as Motorola Solutions (it is the bigger & more profitable part of the company anyway) and Google get a phone manufacture division under their control.
Interesting move.
Larry Page via the google blog: http://googleblog.blogspot.com/2011/08/supercharging-android...
"Motorola’s total commitment to Android in mobile devices is one of many reasons that there is a natural fit between our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere"
and
"Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies."
"Motorola’s total commitment to Android in mobile devices is one of many reasons that there is a natural fit between our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere"
and
"Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies."
One further thought on the patent portfolio. Don't forget that Motorola is widely considered to have "invented" the first practical cell phone. Their patent portfolio isn't just going to be stuff like "Using shades of gray in a UI". It's going to run deep into what constitutes a mobile device.
Keeping Android open whilst treating their own phone manufacturing fairly will be a big challenge for Google. I hope they manage it. If done correctly the result should be a improvement in Android for all manufacturers, as the internal demands of Motorola will want to be heard, but cannot be prioritised.
I am still puzzled as to how Skype cost $8billion.
FYI Motorola Mobility had 24,500 patents when it was launched. http://mediacenter.motorola.com/Press-Releases/Motorola-Mobi...
I am still puzzled as to how Skype cost $8billion.
FYI Motorola Mobility had 24,500 patents when it was launched. http://mediacenter.motorola.com/Press-Releases/Motorola-Mobi...
63% premium...insanity. This is all about patents, isn't it?
Instead of spending $4billion for patents, spend 3x as much, get a huge portfolio (I don't know how large, but it's supposedly quite large)..and a part of a company as well.
Instead of spending $4billion for patents, spend 3x as much, get a huge portfolio (I don't know how large, but it's supposedly quite large)..and a part of a company as well.
To make a broad point without going into details about patent quality:
Nortel: $4.5B / 6,000 patents = $750k per patent.
Motorola: $12.5B / 14,300 patents = $856,164.38 per patent.
Plus 6,700 patents pending.
Plus a hardware company.
There are obviously a lot of other factors, but it seems like a pretty good deal, and maybe a smarter way for Google to go about acquiring patents without having to deal with bidding wars with consortia of their competitors.
Either way, it seems the lawyers are winning. Everywhere.
Nortel: $4.5B / 6,000 patents = $750k per patent.
Motorola: $12.5B / 14,300 patents = $856,164.38 per patent.
Plus 6,700 patents pending.
Plus a hardware company.
There are obviously a lot of other factors, but it seems like a pretty good deal, and maybe a smarter way for Google to go about acquiring patents without having to deal with bidding wars with consortia of their competitors.
Either way, it seems the lawyers are winning. Everywhere.
It's fascinating to see the behemoths (Apple, Microsoft, Google) positioning themselves for the fight ahead. The importance of this fight cannot be understated.
Microsoft won the last fight like this and they have dominated our desktops for 15 years (OK, maybe not all HN devotees) and pocketed gazillions.
Apple are ahead right now (manufacturing handsets, selling software, etc), Google are second and Microsoft are lagging behind in third, but this Motorola deal means that Google might be able to pull ahead of Apple for a period and alienated phone manufacturers who are using Android might flock to Microsoft, inflating their sails a little.
Microsoft won the last fight like this and they have dominated our desktops for 15 years (OK, maybe not all HN devotees) and pocketed gazillions.
Apple are ahead right now (manufacturing handsets, selling software, etc), Google are second and Microsoft are lagging behind in third, but this Motorola deal means that Google might be able to pull ahead of Apple for a period and alienated phone manufacturers who are using Android might flock to Microsoft, inflating their sails a little.
Interestingly, this means the only manufacturer-neutral smartphone OS is now Windows Phone 7. iOS is on Apple, Android is on Motorola/Google, Blackberry on RIM, and webOS on HP/Palm. I wonder if this means we'll see an increase in WP7-based phones from HTC, Samsung, and LG...
I always wonder: Wouldn't it be much cheaper to just spend a few billions to buy some new patent legislation from congress?
One interesting side note: Sprint/Nextel has always heavily relied on Motorola phones, and a few months back, Sprint and Google rolled out tight integration between Sprint service and Google Voice (http://googlevoiceblog.blogspot.com/2011/03/sprint-integrate...)
So now I'm wondering 1) Was Spring anticipating this merger, and 2) will Google's purchase of Motorola be a boon for Sprint?
I'm not a Sprint customer, but in the name of keeping more competitors in the mobile market, I do want to see them stay in the game.
So now I'm wondering 1) Was Spring anticipating this merger, and 2) will Google's purchase of Motorola be a boon for Sprint?
I'm not a Sprint customer, but in the name of keeping more competitors in the mobile market, I do want to see them stay in the game.
Official announcement from Google, written by Larry Page:
http://googleblog.blogspot.com/2011/08/supercharging-android...
He mentions patents specifically as one of the reasons for the acquisition.
"Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies."
He mentions patents specifically as one of the reasons for the acquisition.
"Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies."
From Reuters a few weeks back:
http://uk.reuters.com/article/2011/07/21/us-motorola-idUKTRE...
"Billionaire investor Carl Icahn urged Motorola to shop around its patent portfolio to cash in on interest in wireless technology from companies like Google Inc and Apple Inc."
http://uk.reuters.com/article/2011/07/21/us-motorola-idUKTRE...
"Billionaire investor Carl Icahn urged Motorola to shop around its patent portfolio to cash in on interest in wireless technology from companies like Google Inc and Apple Inc."
This is probably going to make some of the other handset manufacturers (HTC, Sony-Ericsson, etc) complain about Motorola having an unfair advantage when it comes to implementing Android.
Wonder if any of them are about to regret basing their smartphone offerings on Android? The move ought to strengthen the competition among the handsets, though, as Google can now ship their "dream-version" of an Android-phone.
Wonder if any of them are about to regret basing their smartphone offerings on Android? The move ought to strengthen the competition among the handsets, though, as Google can now ship their "dream-version" of an Android-phone.
If this is purely a patent hunt then fine.
If Google hope to get better vertical integration it's my guess they are in for a surprise.
On the surface these acquisitions always sound like they are a good idea. Combine X strenght with Y strenght.
In reality you have two very strong cultures that have to work together. That's simply not going to happen.
Vertical integration is not just a question of having the skill all the way down to manufacturing. It's even more about being able to carry a design vision all the way trough.
Anyone who worked in or with a large organization know how plausible that is.
If Google hope to get better vertical integration it's my guess they are in for a surprise.
On the surface these acquisitions always sound like they are a good idea. Combine X strenght with Y strenght.
In reality you have two very strong cultures that have to work together. That's simply not going to happen.
Vertical integration is not just a question of having the skill all the way down to manufacturing. It's even more about being able to carry a design vision all the way trough.
Anyone who worked in or with a large organization know how plausible that is.
What's the worst case scenario vis-a-vis Android openness and competitiveness?
Google can't take back the code it's already released other than the non-open source apps like Google Mail. But it can stop releasing new code. HTC et al are making too much money from Android, I doubt they'd stop investing in the platform, resulting in slow platform divergence a la Unix in the 80s and 90s.
3.2 hasn't been fully released to the open source community, but HTC and all the important players have it already, and I doubt that their license allows Google to yank it unilaterally.
Google does have to keep releasing code it based on GPL'd work, primarily the kernel, but that's a very small portion of the Android IP.
The first litmus test will be the release of Honeycomb.
Best case scenario? To me, that would involve Google moving towards a more open development model similar to what virtually all other successful open source projects employ.
They will be forced to make moves to placate HTC and all of their other partners, but whether those moves benefit us is the question.
Google can't take back the code it's already released other than the non-open source apps like Google Mail. But it can stop releasing new code. HTC et al are making too much money from Android, I doubt they'd stop investing in the platform, resulting in slow platform divergence a la Unix in the 80s and 90s.
3.2 hasn't been fully released to the open source community, but HTC and all the important players have it already, and I doubt that their license allows Google to yank it unilaterally.
Google does have to keep releasing code it based on GPL'd work, primarily the kernel, but that's a very small portion of the Android IP.
The first litmus test will be the release of Honeycomb.
Best case scenario? To me, that would involve Google moving towards a more open development model similar to what virtually all other successful open source projects employ.
They will be forced to make moves to placate HTC and all of their other partners, but whether those moves benefit us is the question.
I'm of the mindset that this is chiefly for the patents... But.
The real benefactors of this? The former Danger team that made the TMobile Sidekick, one of whom created Android.
If you recall, shortly after the last I/O the gang was announced reunited at Google working on a plethora of hardware toys. I think Google just bought them a new playground to play in.
The real benefactors of this? The former Danger team that made the TMobile Sidekick, one of whom created Android.
If you recall, shortly after the last I/O the gang was announced reunited at Google working on a plethora of hardware toys. I think Google just bought them a new playground to play in.
Does this include any of the H264 patents that Motorola hold? If so this makes this story even more interesting, the cases for WebM/VP8 would change substantially.
At first this made absolutely no sense to me. Totally random borderline crazy, reasonable for defense but a huge risk. Why would Google buy a low margin phone builder thats struggling to make money, its just not reasonable unless they dont want to make money on phones.
Google isnt about the sky its about the floor. Yeah Google does all sort of crazy crap with self driving cars and wind energy but the real focus has always been raising the base. Look at Chrome and Android raising our expectations for speed, usability, security and cost. Google doesnt want Moto to build the Android iPhone, Google wants an Android Razr. The Android Razr would be a rugged dirt cheap smartphone. A new base level 'free' phone that out classes any feature phone. Its in Google's best interest to get a smartphone into the hands of every single person on the planet. How many Google searches can you do on a free AT&T Samsung Rugby® II, probably not that many. Its not a bad move and if executed well this could mark a huge push for the internet and personal communication devices.
Google isnt about the sky its about the floor. Yeah Google does all sort of crazy crap with self driving cars and wind energy but the real focus has always been raising the base. Look at Chrome and Android raising our expectations for speed, usability, security and cost. Google doesnt want Moto to build the Android iPhone, Google wants an Android Razr. The Android Razr would be a rugged dirt cheap smartphone. A new base level 'free' phone that out classes any feature phone. Its in Google's best interest to get a smartphone into the hands of every single person on the planet. How many Google searches can you do on a free AT&T Samsung Rugby® II, probably not that many. Its not a bad move and if executed well this could mark a huge push for the internet and personal communication devices.
Just speculating:
Could this be a genius move?
I don't know how good MM's patent portfolio is but not only they get lots of ammo for the patent war, they also get their own phone manufacturer.
And MM seems to in more than just phones, could they lead the way for the future of Android, namely Android@Home and Android Open Accessory?
Could this be a genius move?
I don't know how good MM's patent portfolio is but not only they get lots of ammo for the patent war, they also get their own phone manufacturer.
And MM seems to in more than just phones, could they lead the way for the future of Android, namely Android@Home and Android Open Accessory?
This is obviously great news for both Google and Motorola. I am glad they did not let the not buying Sun mistake repeat.
I have no idea what Sprint is worth but Google buying or investing in Sprint might take this to yet another level! And Larry had shown he isn't shy of adventures.
Still remains to be seen, how this impacts other manufacturers' support of Android. Could be WP7's gain. EDIT: http://www.google.com/press/motorola/quotes/ - Many including Sony Ericsson, LG and HTC have responded favorably.
I have no idea what Sprint is worth but Google buying or investing in Sprint might take this to yet another level! And Larry had shown he isn't shy of adventures.
Still remains to be seen, how this impacts other manufacturers' support of Android. Could be WP7's gain. EDIT: http://www.google.com/press/motorola/quotes/ - Many including Sony Ericsson, LG and HTC have responded favorably.
In case there's any doubt this is about "defending Android", head over to http://www.google.com/press/motorola/quotes/ . Each of the four statements from an executive at a major device manufacturer users the particular phrase "defending Android."
... or Google takes a gun to the knife fight on patents - http://www.informationweek.com/news/mobility/business/231400...
Funny how I've been anticipating Apple expanding into Google's search, services, and map space, but I certainly never thought of Google getting into hardware. I think it shows just how different the modern consumer space is from the last decade of computing. Unless you believe this is entirely about patents, Google has identified a need to give the Android ecosystem at least one device that's been holistically designed end-to-end.
The comments about this being the end of android as open source are pretty reactionary.
C'mon folks. Remember the moat analogy? Search? MOOLA!
C'mon folks. Remember the moat analogy? Search? MOOLA!
This title should say "Google Buys Motorola Mobility for $12.5 Billion". No?
It is worth noting this is the handset manufacturing part of Motorola.
Google's first foray into consumer electronics? That's big news. Phones and tablets. They are now competing directly in Apple's space.
Full control over the handset stack? (Did Samsung really push back that much on newer "GooglePhone" design?) Or access to patents? It's not really clear. However they do buy themselves a worldwide R&D facility.
Google's first foray into consumer electronics? That's big news. Phones and tablets. They are now competing directly in Apple's space.
Full control over the handset stack? (Did Samsung really push back that much on newer "GooglePhone" design?) Or access to patents? It's not really clear. However they do buy themselves a worldwide R&D facility.
I don't get it about the patent protection thing. If Apple can sue Motorola today despite Motorola's 17,000 patents, how could Google get any protection with the same 17,000 patents?
Google shares already lost 4% on the Frankfurt Stock exchange ( http://www.boerse-frankfurt.de/EN/index.aspx?pageID=35&I... ), and Google didn't answer any questions on how they came up with this extraordinary price. I don't think $12.5bn is justifiable...
esr has foreseen this: "This morning came the news that Google has agreed to buy Motorola Mobile for $12 billion. I was half-asleep when A&D regular Jay Maynard phoned me with a heads-up, but not surprised for a second; as I told him, I’ve been expecting this for weeks."
http://esr.ibiblio.org/?p=3597
Apparently what counts are the patents:
"make no mistake: this purchase is all about Motorola’s patent portfolio. This is Google telling Apple and Microsoft and Oracle 'You want to play silly-buggers with junk patents? Bring it on; we’ll countersue you into oblivion.'"
esr envisions a rosy future for Android: "now that Google has shown it’s willing to fly cover for Android handset and tablet makers, likely there’ll be more of them signing on. This move will accelerate Android hardware down the price curve."
http://esr.ibiblio.org/?p=3597
Apparently what counts are the patents:
"make no mistake: this purchase is all about Motorola’s patent portfolio. This is Google telling Apple and Microsoft and Oracle 'You want to play silly-buggers with junk patents? Bring it on; we’ll countersue you into oblivion.'"
esr envisions a rosy future for Android: "now that Google has shown it’s willing to fly cover for Android handset and tablet makers, likely there’ll be more of them signing on. This move will accelerate Android hardware down the price curve."
A. They already had to compete with Motorola, so they haven't lost or gained a new competitor.
B. They don't pay for Android so Motorola hasn't gotten some new financial edge. Google just has to ensure that all companies still get source releases at the same time. What they do with them is up to them. (aside: I expect we will see MotoBlur disappear with some of its key features rolled into future Android releases)
C. This will allow Google to protect Android much better which is very beneficial to their bottom lines, especially if it keeps patent licensing costs off of their products.
D. Google just has to be sure they don't play favorites but from what I have seen up until now they have been good about that.
E. This may have just brought the competition for who gets to build the next Nexus to an end. (unless the next Nexus is already basically "done" at another partner company)
I think they can get this right... and now hopefully we can get a whole line of nice Motorola hardware with current Android and unlocked boot-loaders, etc. I might have to reconsider the Droid 3 again (more like Droid 4 one day, since 3 is already in the wild as is)