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Analysis of Google's Motorola Acquisition
bonch writes "Pundits have been analyzing Google's Motorola acquisition since its announcement. Dan Lyons, formerly known as Fake Steve Jobs, says Google never cared for the Nortel patents, and that they drove the bidding price up intentionally while negotiating to buy Motorola. This idea is questioned by MG Siegler, who believes buying Motorola for $12.5 billion — almost two years' worth of Google's annual profits — is an act of desperation. John Gruber notes that Motorola was threatening to wage a patent war against other Android partners during the time they would have been negotiating with Google, and that Motorola likely forced them into an expensive buyout rather than a patent license agreement. Google may have also been motivated by the fact that Microsoft was reportedly pursuing a Motorola buyout."
S&P researchers apparently weren't a fan of the deal.
Both Apple and Microsoft are already in patent lawsuits with Motorola. Google has tried to get some smartphone patent portfolio for themselves too, but they just burned $12.5 billion on patents that
1) don't help them at all against Apple and Microsoft
2) alienates other Android manufacturers
But there isn't much Google can do. People act weirdly and make mistakes when they're surrounded and desperate. Google made their mistake here.
Of course, being downgraded by the ratings agency that famously whiffed on highly questionable real estate bonds might be considered a badge of honor in some circles.
That agency. Too bad they've got the entire financial industry by the balls, or their words might carry less weight.
vos nescitis quicquam, nec cogitatis quia expedit nobis ut unus moriatur homo pro populo et non tota gens pereat.
Someone is confused by math and/or the word "almost".
MMI has billions in cash and equivalents on hand, and no debt. Google is effectively paying an amount roughly equal to their 2010 profits.
...and not focusing on the huge footprint Motorola has in the cable set-top box market.
Will consumers be watching videos on their computers, or surfing the Web on their TVs more in years to come? By buying the Motorola hardware, Google doesn't have to guess, their bets are hedged: They are ensured of continued revenue selling your surfing/viewing preferences to advertisers and the NSA no matter how the "connected TV" market shakes down.
A hardcore supporter of SCOX when they were attacking Novell over linux. So... why listen to him? Not like there's a dearth of pundits.
Belief is the currency of delusion.
Moto better make some money for them or that crazy price and the drag on earnings will kill the stock and drive talent to some new startup
Let's just sum up just how hard Google outplayed Apple and Google with Motorola Mobility acquisition:
* Feigned interest in the Nortel patent with joke bids
* Apple and Microsoft fell for the bait and overpayed for Nortel's patents
* Meanwhile Google is off negotiating with Motorola for the purchase of their mobile/settop box/IPTV division
* Apple and Microsoft and their proxies are plastering the Net with justification for using patents as a weapon against the Android Juggernaut
* Google drops the Motorola Mobility purchase bomb
* Google now owns the largest mobile patent war chest with some 17,000 patents and and additional 7,500 pending
* Apple and Microsoft have now made the case for Google to go after their each of their products without mercy with their newly acquired massive patent war chest
An Epic Win for Google.
Motorola Mobile has some 3 billion in cash, so the actual purchase price is around 9.5 billion for Google. The price per patent is an absolute steal compared to the money Apple and Microsoft were tricked into spending for the less valuable Nortel patents.
And for a cherry on top of this epic win for Google, they get Motorola's set top box and IPTV products and capabilities as a bonus.
You can tell just how major this win for Google is by just how desperate the spin from the Apple and Microsoft proxies in the press are pumping out.
While patents are part of the deal, I can see a greater emphasis in Google branching out into hardware and making their own phones in a larger scale. Lets face it, hardware manufacturers and carriers ruin the Android experience in a lot of cases, by expanding into hardware, Google can do what Apple does and create hardware and software that "just works".
Taxation is legalized theft, no more, no less.
I'd say the purchase was really not of much value to anyone. Google doesn't have it in their DNA to do consumer electronics; they are into advertising and SAAS. Motorola's net cost of $7B give or take gives them another lost company with poor direction and too many compromises.
My only hope is that all this nonsense ultimately leads to patent reform. I can dream...
Motorola has enough patents that the lawsuits are going both ways and the outcomes are far from certain. Compare that to other companies like Samsung and HTC that are currently getting trounced in court or have already rolled over.
Furthermore Motorola was threatening to open up the exact same kind of lawsuits against other Android manufacturers, so at least Google has nipped that one in the bud. Making a big point of that should help a lot with the alienation you think the other Android manufacturers should be feeling for some reason.
This may not be the best defense possible (maybe they should have spent a few more billion in the Nortel bidding, i dunno) but it's certainly better than sitting on their asses.
This Space Intentionally Left Blank
But Gruber is some mac fanatic spinning wild fabrications. It was clear in the original Slashdot article about his "interpretation" of some PR speak at a conference that he was imagining his own little reality with regards to Motorola's plans. They say something to the effect of "IP is important" and he translated that to "Moto is going all patent RABMO!" (exagerating here but it's not far off).
Driving the price up for Oracle, RIM, Apple and MS is good business. Google has been known to bid just to drive prices in the past.
As for MS acquiring Moto, I'd be a little surprised if they had a serious offer on the table. I'd wager they were also trying to drive price. These things make sense, Gruber's fantasy land doesn't.
As for HTC, Samsung, et al. I would guess that Google offered them some protection from Apple and MS to help reassure them that Android is worth sticking with. I'm sure hardware manufacturers are privately evaluating long term plans, and it would be silly to think Google would give no preference to Motorola at some point eventually. But for the next year or two at the very least, I'd wager most of the Android hardware companies are on board, but keeping a keen eye on things.
PocketPermissions Android Permission Guide
or desperate. I think Google decided it's time to do battle. It's easy to sue the little guys. But when your the size of Google, it becomes MUCH riskier. They can drag Apple, Oracle and M$ on for years in court. This is not what those three want. A lot of FUD is being displayed, trying to show this as desperation. But I think Google got tired of them picking on the manufacturers of the Droid phones. If Google did nothing, the three would drive away all Droid phones. That in turn would cut into Googles revenue. So they must take action. They already work with the patent office for search in patents and prior art. They have a lot of experience in that now. And they may wield some influence there and in politics. Dont underestimate their cunning. If they assemble a good legal team, it should turn out to be quite a battle. Especially if HTC and others band together with Google. Just waiting for the bell, so I can start making the pop corn.
Google is purchasing Motorola Mobility.
I guess this means it was a shrewd move on Google's part. S&P helped cause the financial crash by rating sub-prime mortgages as AAA. After S&P downgraded US treasury bills people flocked to them as the safest investment in troubled times.
We don't see the world as it is, we see it as we are.
-- Anais Nin
Wow. A post from this bonch character that paints google in a negative light. Color me surprised. this guy hates the google and android look through his posting history.
The soylentnews experiment has been a dismal failure.
MG Siegler is too biased and I stopped reading his articles. He is smart so he knows what
he is doing which is getting more clicks by sensational headlines and zero (unbiased)
information. Reading his posts is just waste of time.
This could be big. If Google, Samsung, HTC and Sony team up for team Android, their portfolio will be rock solid. Apple, Microsoft, Nokia, etc, will be having a hard time leveraging patent war against them.
Google could lock out the other partners, but they are all making some great hardware and you know Apple/M$ are scared with all the recent lawsuits. The more Android devices they more revenue is being generated for Google.
Half of writing history is hiding the truth.
Both Apple and Microsoft are already in patent lawsuits with Motorola. Google has tried to get some smartphone patent portfolio for themselves too, but they just burned $12.5 billion on patents that
1) don't help them at all against Apple and Microsoft
2) alienates other Android manufacturers
But there isn't much Google can do. People act weirdly and make mistakes when they're surrounded and desperate. Google made their mistake here.
Here is one for left field ... suppose Google creates a community cross-license (CCL) pool for Android, similar to the CCL pool for WebM.
http://www.webm-ccl.org/
Most of the 31 Android manufacturers join the new Android CCL pool, and chip in their own patents as well, so that all members of the pool get a zero-cost license to use all of the patents in the pool. Non-members still have to pay license fees.
It becomes possible for members of the Android CCL pool to build an Android mobile device completely covered by patents for zero license cost. Meanwhile, makers of iOS or WP7 devices still have to pay license fees.
Makers of Android devices can produce mobile devices at much lower costs while still protected by a large patent pool for which they are licensed.
Patent war against Android evaporates. Android is far cheaper for consumers than WP7 or iOS, Android wins, as do consumers. Massive PR win for Google. WP7 and eventually iOS devices effectively disappear. All Android mobiles can render WebM video. Google reaps in heaps of cash, even while collecting zero royalties.
Agree with Lyons or Gruber? Ugh. :-)
Well, looking at it, I think I'll go with Gruber on this one.
Dear Slashdot: next time you want to mess with the site, add a rich-text editor for comments.
If you took a biased view you could probably spin this deal in any direction you wanted.
There are clear downsides in that this puts Google in direct competition with other manufacturers and it doesn't necessarily guarantee Android will be immune to patent litigation. On the other hand this means Motorola will not be making WP7 devices any time soon and all but ensures the long term future of Android as a relevant platform.
Whatever the outcome this gives Google the best possible chance to take the competition out of the courtroom and into the open market.
Something most people have missed out on: Imagine it'd been Microsoft who bought Motorola, that could have been a massive blow, this now puts them in a position where they can sit and hope for the best, or follow Google's lead yet again and buy out a dying Nokia which would be downright suicidal, or RIM, which would make far more sense given their strength in the enterprise.
and the cable companies have a lot of control and they are slow to update software any ways. On comcast new software takes a long time to roll out or it dies in the test market.
Wouldn't be surprised. They both sound like the same person.
Google bought android for $50 million in 2005. Last month they bought 1,000 patents from IBM (I can't find a number, but I thought $1 billion was thrown around). Now, $12.5 billion for Motorola.
Google makes money selling ads (or, perhaps, your information). That's a lot of ads until Ahab^w, Larry's baby is in the black.
Do you even lift?
These aren't the 'roids you're looking for.
But I am unsure about the game of chicken. I have a strange feeling that Google is ready to take them on. I wouldn't be surprised of they got aggressive and took the battle directly to Apple, M$, and Oracle. Since they already are in a battle with oracle, we will have to wait and see what is left of oracles patents after all of the reviews. Most of Oracles patent claims have been shot down already. They are still being reviewed, and the court case is starting to drag on. Not sure Apple or M$ would really like to end up being dragged through the courts for years and years. But what I really cannot predict is who will be willing to settle early. All of these companies have A LOT of pride. So I can only imagine a LONG and protracted patent battle to the death. Or maybe its just my sick mind dreaming. - lol
MMI has over $3B in cash and over $2B in deferred tax credits, so the *real* cost is a little over $7B.
Too bad lazy ass Gruber and MG Siegler couldn't be bothered to look at MMI's last quarterly statement to easily discover this information. They both have zero credibility after their posts on this deal.
When I left the GSM Mobile division of Motorola 3 years ago, I would have bet money that the company would fall flat sooner rather than later. My aptly timed departure came only a few months before my entire team was sent home. After riding the Razr wave all the way back to the beach, Moto had no competitive mobile software platform in its R&D pipeline. Even at that time, there were talks of the company spurning its mobile division, which was bleeding cash at an unprecedented rate and dropping market share to Apple, Samsung, and others. At a few dark corners of the office, a privileged group were working on integrating Android on some upcoming VZW handsets. Fast forward a bit, and Motorola finally did split the mobile division off. They were gunning for this outcome for years, I think Google was an inevitable outcome.
Motorola has a few billion in cash on hand, the set top portion of the company has been conservatively valued at about $2.5B if sold today so Google effectively paid $6.5B for 24,000 patents, many of which can provide protection against the likes of Apple and Microsoft in the mobile market, and got the entire phone design and manufacturing part of the company for free. There are very few ways Google didn't get a good deal here for the long term and almost all of them involve those 24,000 patents being near worthless and Android being heavily saddled with licensing issues.
I'll meet you at the intersection of "Should be" and "Reality"
They're on a roll. Don't distract them with facts.
The fact that Google is buying Motorola Mobility is interesting itself of course, but the reportage is interesting too. It's getting a ton of press, almost all of it gloom and doom. BusinessInsider goes on about some of the major properties in the deal, but misses some major ones like factories around the world, an ARM Architectural license, and other things.
I don't think this is a bad deal for anybody involved. Sure, MMI isn't an earnings star right now - but they just finished a painful reorg and are on track to do very well now that it's over. Even at their worst they weren't burning WP7 marketing kinds of money. Their share has been declining, but they still have more of the market than WP7 does. Google gets some more patents for their growing defensive arsenal, which means the rest of us get to keep getting ever-better shiny Android widgets. Google's Android partners get a tough defender - and now it looks likely they'll be able to assemble a patent pool terrifying in extent. Moto might even stop with that Blur and locked bootloader nonsense. Moto doesn't get carved up and eaten by another phone vendor. The US factories don't close. There's lots to be happy about.
As you note, it's barely a dent for google. Google will make almost as much income in the time it takes for the deal to close, or half as much at least. People were already complaining Google was hoarding cash. MMI will probably spin off some money too.
So why the panic? I suppose it's disruptive. On Friday a lot of folks thought they had a plan to kill Android. Now they're going to have to go back to the drawing board. People don't like too much change.
Help stamp out iliturcy.
don't tell them about the snazzy gingerbread tablet from vizio that walmart is selling, it's not as powerful as some, but it very well thought out.
1) charges off USB instead of a Barrel charger
2) 3 speaker positions for sterio in portrait and landscape view
3) programmable universal remote app and IR unit for home theater integration
4) mini HDMI port and flawless rendering of 720p high profile
for $299
seriously i want this tablet
Snowden and Manning are heroes.
Who is MG Siegler and why should we give a damn what he thinks about anything?
It started back in Team Fortress Classic
Slashdot Editors: Are you that desperate for material?
It is truly a thing of beauty.
The soylentnews experiment has been a dismal failure.
Because, lets be perfectly honest for a moment, there is no Android phone that comes to the simplicity and ease of use as an iPhone.
Yes, lets be honest here.
90% of people could handle using an Android phone such as a HTC Desire, Samsung Galaxy S or Huawei X5. 90.5% of people could use an Iphone. So technically that's correct but the margin is so tiny that it doesn't compensate for the loss in functionality.
A lot of people who've had Iphones are now switching to Android and loving it, this is why Apple is suing as hard as it can to keep Android products off the market. The minute someone uses an Android product, this myth about them being hard to use flies out the window.
Calling someone a "hater" only means you can not rationally rebut their argument.
hey I'm not precisely an Apple fan but iOS it's not going to disappear in such context. Walled garden and OCD and all iOS and iDevices are competitive devices on their own, Apple can't probably pull the antics like first generation gadgets w/out camera or essential ports, but thats all.
tl;dr Apple would have to deliver it full without the overpricing. Cash cow it's over.
WP7 will find it's home in corporate if they are wise and buy BB before Apple does, else they will have to deliver something pretty good to compete, that not the MS we know, Ballmer needs to go it's all I know.
People seem to be ignoring this huge point. Motorola Mobility also includes their video hardware division. This is the group that designs, distributes, and supports headend hardware for cable video systems, and the set top cable boxes made to connect to those systems...not just set tops as some have commented. Think encrypted QAM video services from the sat down to the customer. Think VoD servers for storing and streaming digital video content to set tops. Motorola and Cisco (Cisco owns Scientific Atlanta, SA) produce the most widely used video headend systems in the states. Moto's DAC is still the most widely used in most cable system footprints here. Now think about how video service is evolving today and mash these new properties in with Google TV/Android. Don't forget about all the fiber Google has been buying up over the years. Yeah, shit is about to get real.
google+motorola=apple?
Google is effectively paying an amount roughly equal to their 2010 profits.
I'm sorry, but what are you talking about? Google agreed to pay $12.5 billion for Motorola Mobility. Google's 2010 net income was $8.5 billion. Unlike you I didn't pull that figure out of my ass. That's according to Google's own financial statement.
According to the same statement their 2009 net income was $6.5 billion, so they paid nearly two years profit for MMI. Coupled with the facts that the $12.5 billion price represent a 60% premium over MMI's share price, and that Google agreed to pay a penalty of $2.5 billion if the deal falls through for whatever reason, this certainly smacks of desperation on Google's part.
And the deal could very well fall through. It's still subject to regulatory approval, and with Google being investigated worldwide, this is certain to ratchet up the scrutiny. And then there's good ol' Microsoft. What if they decided to play spoiler and offer more for MMI? I certainly wouldn't put it past them.
I really hope that out of the whole war, we can see some good commercials again. Regardless of whether you loved or hated the "I'm a PC. I'm a Mac." commercials, you have to admit they were great fun to watch. I'd love to see Apple resurrect the theme and do Droid vs iPhone commercials.
consumers do not win if Android wins. They only one who would benefit from such an outcome would be Google's shareholders. Consumers win when competition stays healthy. FYI, Apple has already proven that it's really hard to make phones cheaper (and better) than they do. This just smacks of Android fanboyism.
I was going to finish by saying that I have to agree with Gruber on this one. While Google was in active negotiations with Motorola, Motorola CEO Sanjay Jha, and their largest shareholder, Carl Icahn, were making public statements about attacking other handset manufacturers with their patent portfolio, as well as the possibility of licensing Windows Phone 7. The timing of the statements can't have been a coincidence, and I'd be wiling to bet that they were designed to pressure Google at the bargaining table. The deal so generously favors Motorola that it sounds to me as if the terms were dictated by them. I think Motorola was in the driver's seat the entire way.
S&P researchers apparently weren't a fan of the deal.
lollll...is that Wall Street lingo for S&P had invested in a different direction?
Orwell: "In a Time of Universal Deceit, telling the Truth is a Revolutionary Act"
It's a crazy thought, but what if Google were to use the Motorola aquisition to produce top of the line android handsets and give them away for free? I'm not sure how the financials would work out, but I'm assuming Google has now inherited all the good relationships Motorola has built with the carriers. Could you imagine what an industry shake-up it would be if Google offered the latest Nexus xyz for absolutely nothing? Take it a step further and say that not only will this Nexus be free, but so will the next one? Sure, they would lose tons on the hardware and manufacturing, but giving away the latest and greatest smartphone to every person on the planet would surely cement them as the world's dominant smartphone platform. Is it possible they could make enough profit from a billion new users on android to offset the manufacturing costs of the latest smartphone? Could the carriers provide enough subsidies to make it happen? It seemed to work for Nokia several years ago. Are we waiting for the new age of free phones?
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What's the point of saving your pennies if you can't buy cool stuff when it's on sale?
Help stamp out iliturcy.
Google does seem to have become rather distracted by Android, which, after all, doesn't make them any money (except through ads).
In the meantime, people are starting to notice that they haven't been doing much with their search, and everyone else has caught up.
You do not "fein interest" in something by bidding a few billion dollars. What if they had won? Very obviously they meant to get that, or at least it was a serious attempt.
Apple and Microsoft got a huge patent bundle for far less than Google, which they can now use to defend against Motorola patents Google has acquired, so in fact Apple and Microsoft (and other partners) have been shown to be eerily prescient in requiring said patents even IF this had been Google's plan all along.
And speaking of "overpaying" - Motorola has been losing money. It's not like Google has ONLY paid 12 billion dollars, they have bought continuing obligations that will cost more. And in case you hadn't noticed, 12 billion is a HUGE sum, far more than Microsoft and Apple shelled out individually - how can you say in one breath that those companies overpaid when Google bought the same commodity (patents) for a far steeper price?
I mean yes Google can use these patents against Apple/Microsoft but I question if the Motorola patent base has the same level of quality as what Microsoft/Apple had individually, never mind the Nortel stuff. Sure Google can go after them but all Google has really bought into is a very expensive draw, at best.
Which points to the real reason Google purchased Motorola - they needed at least a draw, and were willing to pay ANY price to get it. Which they did, because even though the people at Motorola could no longer design phones they sure could suss out a desperate buyer and take advantage of that...
In the end I question if it's a victory at all, for anyone. Because now Android HAS to start making Google some serious money in a way it did not before. Are you sure you wish to cheer the Android division becoming indebted to Google to the tune of 12 billion dollars and the subsequent changes that will occur as a result?
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Google might be paying $12.5b, but they'll get back the cash on Motorola's balance sheet -- $3.3b according to their 1st quarter results.
Motorola Mobile's total liabilities almost exactly balance out total assets - and Motorola Mobility has been losing money every quarter...
Scroll down to "Condensed Consolidated Balance Sheets". Total assets: $9,429 Total Liabilities: $9,429.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
consumers do not win if Android wins. They only one who would benefit from such an outcome would be Google's shareholders. Consumers win when competition stays healthy. FYI, Apple has already proven that it's really hard to make phones cheaper (and better) than they do. This just smacks of Android fanboyism.
Apple have already proven that it's really hard to make phones any cheaper if the manufacturing costs of said phones includes license fees for patents you do not hold yourself, and you include a charge (and hence profit for yoursel) for the OS. Android smartphones are already significantly cheaper than the equivalent iPhones.
Android costs significantly less to manufacturers if they do not have to pay license fees in order to make Android devices. If OEMs can make Android devices without having to pay out license fees, their manufacturing costs will be a lot lower.
Consumers certainly do win if they have to pay significantly less for equally functional smartphones (because license fees are no longer being passed on to consumers).
Competition stays healthy if there are 31 makers of Android smartphones, as there already are.
I am pointing out a way that smartphones can indeed be significantly cheaper again to consumers, compared to Apple's iPhones. This can work only IF Google create an Android CCL pool from the MMI patents, which is something that Google haven't done yet. Indeed, Google haven't bought the MMI patents yet. How can talking about this possibility be fanboyism when Google haven't done it yet?
Your ineffective attempt at rebuttal smacks heavily of Apple fanboyism.
What's the point of saving your pennies if you can't buy cool stuff when it's on sale?
Google buying Motorola is more like finding all of the hotel rooms in town have been taken by a convention and paying $400/night for a Motel 6.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Think of the fact that acquisitions don't happen overnight.
This one did. Many people (including insiders) are saying the talks with Motorola really started after Apple/Microsoft won the other patent bid.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Google will ask/pool patents of every droid manufacturer & allow members free access..So this is a win win situation for every one in the pool.
When I left the GSM Mobile division of Motorola 3 years ago, I would have bet money that the company would fall flat sooner rather than later. My aptly timed departure came only a few months before my entire team was sent home. After riding the Razr wave all the way back to the beach, Moto had no competitive mobile software platform in its R&D pipeline. Even at that time, there were talks of the company spurning its mobile division, which was bleeding cash at an unprecedented rate and dropping market share to Apple, Samsung, and others. At a few dark corners of the office, a privileged group were working on integrating Android on some upcoming VZW handsets. Fast forward a bit, and Motorola finally did split the mobile division off. They were gunning for this outcome for years, I think Google was an inevitable outcome.
Nice and quite useful blog. Would like to say that stock market hardly gives and second chance. Once opportunity lost means it’s gone forever. Now the biggest question is how to grab trading opportunities every time we trade?
Well here comes the technical analyses handy. Just rely on research rather than your guts feeling and one should stop speculating in the Share market.
Follow few basic trading rules and we are sure one can earn huge amount in the Indian stock market only by trading in NSE and BSE
If you were HTC or Samsung, how comfortable would you be in using the OS of your competitor? Would you REALLY believe Google when they said that they won't give Moto preferential treatment?
Well, does Motorola manufacture their own handsets, or the Xoom, or anything, or do they just design it & contract it out to the HTCs, Lite-Ons and other Taiwanese manufacturers? B'cos that's what most companies worldwide have been doing w/ their products - getting these manufacturers take their reference designs, and manufacture them and finally provide their own brands. So if one was HTC, they wouldn't mind that much. I do think Google would use the Mot brand to sell not just their hardware, but any new ones they come up w/. Or if they thought their own brand on the Xoom or other things would signify the Google seal of approval, they may go that route. If you're Samsung, you'd either be using Google's Android, or Microsoft's Windows 7, or maybe some other platform - Symbian or something.
Apple and Microsoft pundits worry about this deal more than Google analytics. I'm not saying that Google did it with ease in heart, but more or less they outplayed Billy and Jobs. Now Microsoft will have to waste approximately twice a half for Nokia if they aim to stay relevant in mobile market. No matter how profitable Apple is they won't buy Nokia, so their situation is much more difficult - either they give up and allow push themselves again in a niche, or they trying legitimise everyone in mobile market which is cheaper than themselves. In fact looking at Apple is a little bit sad - they have everything - growth, profit. But they are punished by "growth unlimited" vision by shareholders.
user@ubuntubox:~$ stfu This server is going down for shutdown NOW!
It becomes possible for members of the Android CCL pool to build an Android mobile device completely covered by patents for zero license cost.
No, not unless Apple, Microsoft and Oracle joins the "Android CCL pool". Remember that Apple, Microsoft and Oracle have their own patents, and are not afraid of Motorola, Samsung, HTC's patents.
Uhm ... what?
The ecosystem: well, that's exactly why they had to make this purchase. They had no choice.
1. First, they need a mobile story. Let's just take this as an axiom because this segment's going up, and desktop down.
2. Their story was Android, but it was threatened both by a) Apple and M$ and by b) Motorola's talking about charging for Android.
3. Buying Motorola solves both 2a and 2b.
As for starting over: 1) They'd lose time, which is money. 2) It's not just Google, all their partners would have to start over.
Simply bashing Apple/M$ on a blog doesn't do anything for them. And a whole new OS would still have been the same old target for Apple.
This purchase totally rewrites the rules. It also gets Google into the TV/cable business, just like that.
I'm not a lawyer, but I play one on the Internet. Blog
Quoting parent (mod that up, not this): "But the real benefit comes from Motorola's own patent portfolio. If Google chooses, it can sign a NATO-style alliance with other Android makers, stating in effect that an attack on one is an attack on all of them. With patents covering some of the most basic aspects of mobile technology in its possession, Google can make it very attractive for $LITIGANT to not only leave Google alone, but to leave all the other Android makers alone, too."
If you don't risk failure you don't risk success.
They could spin off the set top boxes and cable modems back as GI, or sell it to someone like Echostar or Comcast. Unless Google wants it for Google TV. But do they really want to start competing against Comcast? Also the Xoom - Google is now getting into the crosshairs of Apple's legal assault on Mot!
They lost 99% credibility.Making a 2 trillion dollar mistake in their numbers then declaring that even if they added wrong , they kept the lower rating because the government does not reflect their political views and objectives. Well boohoo . S&P is at the bottom of the barrel and i wont shed tears if they go in bankruptcy.S&P should be brought to court on charges of High Treason for what they did to their own country. .. i shouldn't expect too much of the American joe.
Usual right wing nut jobs at work. Hopefully the US citizens will emerge from their political coma and start to make sense.
I know
And really stir things up. Bye bye Microsoft's plans. Plus they get more patents. But I'm guessing they don't have the money to do it after buying Motorola.
Motorola is a communications company, not just a phone maker Look at the distributed whitespace broadband that Google has been looking at deploying; now they own the infrastructure to make it happen. I see phones fitting in as a smaller piece of a giant puzzle. They has been planning this for years and owning Motorola means they won't have to wait on others to make the hardware anymore.
Kindness is the language which the deaf can hear and the blind can see. - Mark Twain
Read the press release carefully and you'll see that it is "17,000 patents world wide".
What does that mean?
Well lets assume that they've used each country in North American and Western Europe separately for a start. Lets assume 17 countries.
Now we're down to 1,000 patents.
Now include Japan, Australia, South Africa. Now we're down to 850 individual patents and 350 pending. That's a far more believable number.
See where I'm going?
The press release number is ambiguous because there is no such thing as a world-wide patent unless the patent application is made in each jurisdiction.
A few months ago, Google bought SageTV, a small but well-regarded manufacturer of media streaming devices and associated software. With the purchase of Motorola, that previous acquisition now makes a lot more sense. Google is obviously serious about making GoogleTV and associated products a success, and sees Motorola as their way into the cable TV set-top box market. For Google, the benefit comes in additional advertising revenue. For consumers, the benefit is that finally we may get cable boxes that don't suck. The overall level of competence in the set-top box industry up until now has been horribly low.
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Apple has always been a premiere hardware company with lucky forays into software now and then (MacOS, iTunes, Apps). Half of Apple's products have been huge best-sellers. Very few hardware companies have a 2nd success. I dont think Page knows what he is getting into.
It's good for me because I like my Android tablets and phones.
Then I would think you'd be rather more upset given the number of hardware makers that are going to switch away from Android after this.
People have counted Microsoft out but Microsoft is perfectly positioned to take over all of the gains Android has enjoyed, and is now telling handset makers "we are the only mobile OS not competing with you".
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The thing about the Motorola patents is that they're already licensed. Moto has a patent on the cell phone. Don't you think that the makers have already licensed that patent?
The US manufacturers have already done a cross-licensing deal with Moto. How could they sell cellphones if they hadn't? Google bought a pig in a poke.
Motorola has a cash pool of $3bn
You do realize you are taking one number out of a large financial report, and totally ignoring OBLIGATIONS????
No, you apparently don't; Look at Motoroa Mobile's balance sheet, assets are around 9 billion, but OBLIGATIONS (debt and other money owed) is the same amount - in fact slightly higher.
So no Google did not just "buy $3 billion".
People who think this is merely about mobile patents and nothing else are missing the bigger picture,
And people who think Motorola can help Google in regards to ANY other aspect of commuting are missing the fact that Motorola has been dying in all spaces for some time now. Oh yes Motorola makes set-top boxes. Which are dying remember as people just get video off the internet these days? Which computer to Roku or even the AppleTV did Motorola make? Oh that's right, none, because they had the cable division...
Google just bought an albatross, not an inside line... The funny thing is it's not even a single albatross but a fleet of them.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
If Google do create a community cross-license pool for Android, they effectively give Android an unassailable advantage in the smartphone market.
No, they simply nullify the advantage Apple and Microsoft had over them. They gain no advantage whatsoever beyond merely continuing what they were doing, only now they must figure out how to make $12 billion from it.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The others paid 4 billion because they thought they were going to get patents they could throw at Android
So to put it very simply, Apple/Microsoft spent less than $2 billion each on offense, while Google spent $12 billion on defense.
Sounds to me like Apple and Microsoft won without even using the patent horde they gained, by forcing Google into the only possible defensive position. Apple/Microsoft had a win/win going, either Google didn't buy any patent pools and could be sued, or Google would horribly overpay to reach equality...
And don't forget it's really less than $2 billion each as there were a lot of companies in that pool.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
No, you apparently don't; Look at Motoroa Mobile's balance sheet, assets are around 9 billion, but OBLIGATIONS (debt and other money owed) is the same amount - in fact slightly higher.
Right, but if you follow it through, Google is paying $12B to Motorola. Who they're going to acquire. The money will go back to Google, except the Motorola shareholders will have an inflated percentage of Google shares vs. if they had gone to e.Trade and traded a swap. It only costs Google $12B if all of Motorola's shareholders cash out and nobody comes in behind them. Likely they're rather happier to be owning the joint shares. I guess this is where Microsoft's PR budget can come in handy - to try to persuade some of them to sell.
If either stock was taking a hit over this, I'd say it was a good time to buy. Except I'm not investing in any USD-denominated investments.
My God, it's Full of Source!
OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
Is it just me, or is Google actually trying to get things back on track here? Now that they own Motorola, after dealing with all the patent lawsuit crap and all the dust settles, this will be a great opportunity for more peaceful smart phone development and deployment. In one swift motion, Google has cut the need for striking deals with Motorola (problem, licensing?) and can now safely develop for Motorola phones.
Seems to me like locking down a phone manufacturer is a smart move, as they can now focus on making Android more polished and smooth (as it has been criticized for, compared to the iPhone interface).
The more you know, the more you have to say and the more you should listen.
Right, but if you follow it through, Google is paying $12B to Motorola. Who they're going to acquire.
WRONG!!!!!!!!!
Google is buying Motorola MOBILITY. Who owns MM? Motorola. Who do you think is getting 12 billion? Hint, it's probably not the company being bought.
If you could buy a company for $12 billion which you then got back, *I* could have bought Motorola Mobility.
If either stock was taking a hit over this, I'd say it was a good time to buy.
If you think so, go ahead. I'd personally short the HELL out of GOOG at this point, just from past experiences of large corporate mergers if nothing else.
But in reality I'm not buying or selling GOOG, I'm staying far away from the whole thing.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
These guys know that Google is buying Motorola specifically because Microsoft and Apple attacked their businesses (and demanded licensing fees from many of them).
And now they know they will still be attacked while at the same time Google is competing directly against them manufacturing headsets. So the situation has gone from bad to worse for all of them.
They have more advantages by staying with Google.
Your link claims Google has an advantage of being open while not understanding that Google has closed down Honeycomb (no you can not download it from the link you provided).
And now that Google has to make 12 billion off Android expect it to close further.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
> For a tiny fraction of what they spent to buy MM they could have designed a new
> mobile OS from the ground up and gotten some great press.
And what would have stopped AppleSoft from suing this NEW phone OS into oblivion using the same BS patents? Anyone? Buehler?
You can't engineer around patents that cover obvious functions. Apple has made it, uhm, patently clear they were going to destroy Android with BS patent litigation. Now that Google has tons of mobile patents-- some of the earliest and most basic in the business-- destroying Android via litigation just went from foregone conclusion to longshot.
Was it worth 12.5 billion to save a whole ecosystem? Now that's a reasonable debate. With so many enemies teaming up against Google to beat them by any means necessary, I say yes. Google needed weapons in the patent war. Badly. Now they've got them.
Who is RTFM and when will he help me with Unix?
All of the kings go to war and then after the dust settles.... RIM comes in with dragons to kick some ass? ---- Or RIM is the first king betrayed? And it is a crap shoot as to which blood line succeeds?
As a developer of .NET mobile windows apps for transportation/medical industries, Microsoft has provided a huge opportunity for Google/Motorola. We are stuck with Windows Mobile 6.5 forever on all the industrial focused mobile hardware. Microsoft is only focused on the consumers now, and Apple hardware is too closed. Look at a device like a Motorola MC65 for example. No smart phone can replace that, and most customers actually don't want consumer devices in the inventory, too attractive for theft. Doesn't matter if they are cheaper and just as capable.
I'd love to see Android on those platforms, and a new generation of tablet hardware. The issues with fragmentation and app security on Android won't apply to this market. Software will be highly controlled, and maintenance agreements will take care of upgrades.
And whatever Google does in this market, it won't conflict with their Smartphone licensees.
Hmm. Seems that the actual hardware makers are positive on this, contrary your position:
“We welcome today’s news, which demonstrates Google’s deep commitment to defending Android, its partners, and the ecosystem.”
– J.K. Shin
President, Samsung, Mobile Communications Division
“I welcome Google‘s commitment to defending Android and its partners.”
– Bert Nordberg
President & CEO, Sony Ericsson
“We welcome the news of today‘s acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem.”
– Peter Chou
CEO, HTC Corp.
“We welcome Google‘s commitment to defending Android and its partners.”
– Jong-Seok Park, Ph.D
President & CEO, LG Electronics Mobile Communications Company
Although its entry into the patent-war big leagues didn't start out very smoothly, perhaps Google is better off now with the IBM and Motorola portfolios than with the Nortel patents. It will certainly have more patents at its disposal now than if it had bid higher than Pi at the Nortel auction.
Google rocked their world by being forced into buying a has-been hardware company for the cost of two years of profit after losing the Nortel patents that were only $4.5 billion?
No, Motorola completely owned Google. Google was painted into a corner and had no choice but to buy Motorola to prevent an Android civil war. I think Google fans are so desperate for any kind of good news that they're spinning anything they can to make themselves feel good about being Google fans.
What are you smoking? Android tablet marketshare isn't even out of the single digits.