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Was Google's Motorola Mobility Acquisition a Mistake?
Nerval's Lobster writes "Even before the Google acquisition, Motorola Mobility was engaged in a major legal battle with Microsoft, insisting that the latter needed to pay around $4 billion per year if it wanted to keep using Motorola's patents related to the H.264 video and 802.11 WiFi standards. (The patents in question affected the Xbox and other major Microsoft products.) Had that lawsuit succeeded as Motorola Mobility originally intended, it would have made Google a boatload of cash—but on April 25, a federal judge in Seattle ruled that Microsoft's royalty payments should total around $1.8 million per year. 'Based on Motorola's original demand of more than $4 billion per year from Microsoft,' patent expert Florian Mueller wrote in an April 26 posting on his FOSS Patents blog, 'it would have taken only about three years' worth of royalties for Microsoft to pay the $12.5 billion purchase price Google paid (in fact, way overpaid) for Motorola Mobility.' This latest courtroom defeat also throws into question the true worth of Motorola Mobility's patents. After all, if the best Google can earn from those patents is a few pennies-per-unit from its rivals' products, that may undermine the whole idea of paying $12.5 billion primarily for Motorola Mobility's intellectual-property portfolio.
not Microsoft
No one blinked an eye when Google paid what it did for Motorola. Now, one judge has brought out the critics and the second guessing. Unless you have a time machine, or can talk to every judge with a 'what-if', you can only do your due diligence. It's time to move on and look to the next problem, not rehash the past.
I stopped reading when I saw the name Florian.
He is a professional Troll, STOP POSTING HIS STUPID BULLSHIT!
How many lawsuits have been avoided because Google now has a formidable patent portfolio. Was the money spent on a nuclear arsenal wasted because there was no actual nuclear war?
Seattle judge, Microsoft is located in Redmond near ... (hint 15.3 miles away)
I sincerely hope it turns out to be a big one. Gotta take the profit out of speculation somehow.
“He’s not deformed, he’s just drunk!”
You do not take his words seriously. Google has bigger plans for Motorola. Some of which we would see later this year. They need Motorola for a possible situation where Samsung forks Android away. Patents are a big part of the deal but I doubt Google thought that they would recover their investments through royalties. Loads of people said acquiring YouTube was a mistake. Just give it a year or two. Microsoft paid 7 billion dollars for Skype. Around the same for aQuantive which they now admit was a bad move! Google paid same for Motorola Mobility and I am sure it is worth much more (IP and assets).
There was never any chance of Motorola getting what they were demanding in this case, in fact they might very well have gotten more than what the court determined here if they would have not been such douches about it, not to mention still been able to negotiate their own terms with others which is now largely down the drain.
Was Google's Motorola Mobility Acquisition a Mistake? - Well only if Google was really counting on Moto prevailing in this case, which I can't imagine they were, the court document is quite a comical read.
There is a lot more going on at Motorola Mobility then that lawsuit.
The Kruger Dunning explains most post on
HELL YEA!
Is this news?
Two important things are missed here:
1) Google mainly bought the patent portfolio for defensive purposes, not as revenue engines in themselves. The point of the suit is that MS wants to use the patents without paying for them. It's basically a move in the MS-vs-Android war.
2) The judgement doesn't pass the smell test. Read the articles over at Groklaw for the details, but the judge here is ruling that Motorola must accept patent pool rates for a pool they don't belong to, rather than negotiate rates using the methods of the group they are a member of. The whole proceeding has been slanted toward the home team (MS) the judgment seems to be very much an overreach, and probably won't survive appeal.
"My strength is as the strength of ten men, for I am wired to the eyeballs on espresso."
Hardware patents which require actual innovation, research, and significant funding aren't worth very much. Software patents, which seem to often be pulled out of one's behind without much thought, are worth billions of dollars and are strong enough to shut other companies down. Hardware patents? Pennies and no leverage against infringers. What a joke this patent system is. True innovation is left essentially unprotected, whereas trivial, obvious "inventions" get massive, industry crushing protection.
Google/Motorola Mobility might actually have to manufacture and sell a product to justify their capital expenditure! The horrors!
Also, I agree with posters above, I thought the patent portfolio aspect of the deal was a defensive one.
my, your, his/her/its, our, your, their
I'm, you're, he's/she's/it's, we're, you're, they're
Sounds more like judicial activism rather than fact LOL.
How can payments over a three year period on the patents alone, from one infringer no less, be worth more than the company was valued? We need more judges like these that just use common sense.
no comment
Kim Jong Un, is that you? Making empty threats, and just talking up a storm with no one listening to you?
I've been following this site since before it had user accounts. It has really been a downhill ride in recent years. It is more and more just about click-whoring.
This article is a case in point. Slashdot editors must know by now that Florian Mueller is a professional troll who is paid to spew FUD about his clients' enemies in the media. That the editors do not care, since FUD articles apparently are click magnets, just makes me feel nauseous about coming back here.
There are so many more intelligent commentaries about this ruling that could have been posted instead.
So many butthurt Android lovers, defending everything Google does, denying reality and find justifications for everything...like...like...a sheep!
Yes it was a mistake. Not one lawsuit was killed of, the patents are worthless (see : 1,7 million instead of 4 billion a year from MS), are declared invalid (Apple lawsuit) or can't be used (SEPs) to attack without producing threats of serious intervention by US and EU officials due to FRAND abuse. SEPs can't even be used as a defense as you have to license them and can't use them to sue someone.
Google knows jack-squat about anything not related to placing ads in results. Luckily for them, they are so very good at that one core competency that they can afford to stupidly thrash around with quite good ideas that they simply cannot implement because the organization is a collection of rudderless savants.
Sergei: "Uhh, Larry?"
Larry: "Yes, Sergei?"
Sergei: "I, umm... I misclicked."
Larry: "On what?"
Sergei: "Motorola. I was browsing Corpazon and I accidentally clicked the 1-Click Buy button for Motorola."
Larry: "How much is that?"
Sergei: "12.5 bils..."
Larry: "Meh, just keep it. Not worth the bother to cancel that."
Sergei: "Alright... I guess we might be able to use them for some of our Android stuff."
*Larry shrugged*
Quoting Florean Mueller that is.
It seems this submission is garbage.
By acquiring a company with huge net operating losses, Google is expected to reap $700 million a year in tax deductions from future profits each year through 2019. Google also will be able to immediately reduce its taxes by $1 billion due to Motorola Mobility's U.S. net operating loss, and by a further $700 million due to its foreign operating loss,
Source:
http://www.reuters.com/article/2011/08/31/us-motorolamobility-google-tax-idUSTRE77U1QX20110831
Google now has a handset maker in house, which gives them certain advantages in the mobile market beyond the patent portfolio.
Google's acquisition of Motorola Mobility is certainly more honest than Microsoft's ongoing stealth assimilation of Nokia.
If you're buying a company because you expect it to win big in IP lawsuits, you're doing a bad thing.
For every problem, there is at least one solution that is simple, neat, and wrong.
The judge will be found in contempt of federal laws, namely being bought and paid for by Microsoft or under orders of politicians bought and paid for.
In other news, a German court finds the American Judge to be in contempt of the German court, and ordered to spend 350 years in prison for being a pompous asshole.
why in hell is ANYONE still citing the malignant moron and Arch Shill Florian Mueller in any context at ALL? Mueller is the same level of 'expert' on patent law that Glenn Beck is an expert on constitutional law. Whatever Florian says, the reverse is true and can be verified and discussed with actual rationality over on Groklaw.
Florian is a "patent expert"?????? That makes me a Brain Surgeon......why? Cause I say so.
What?
Is as close to being a "patent expert" as I am to being a billionaire. (no chance at all)
At least, not a mistake for Motorola shareholders. They made out like a bandit on that deal.
This is a Florian Mueller article. It has no merit, no validity, and should be taken with the same grain of salt you'd take one of those folks who said the world would end in 12-12-2012.
For $12.5B you get:
$3.2 in cash
$2.35 billion from Motorola Home sale
$1B billion in real estate
some deferred tax assets.
patents
Looks like a far better deal than Apple and Microsoft got for $4.5 billion in Nortel patent purchase.
n/t
Google acquires Motorola, and then proceeds to have one of the worst product rollouts in recorded history with the Nexus 4 phone. I mean why Google could not leverage at least one person from Motorola on how to actually release a phone, involving an eCommerce website that would actually work and about how to create a supply chain that could actually provide phones and its accessories.
I mean what was the point of getting Motorola if not to apply it to their own phones, at least the experience of a company that has had some past success selling phones.
I think this is clearly an example where Google got too big too fast, the Nexus part of Google is not even aware that another part of Google owns a phone company.
I haven't thought of anything clever to put here, but then again most of you haven't either.
It was the royalties per se, but to protect the Android environment. If Apple had it's way they'd LOVE to kill Android. But they can't because Google hold mobile patents that could end Apple's iPhone and IOS product.
when evaluating a company you generally look at it's 15 year P/E
Then where did the meme come from that companies are so interested in making the next quarter look good at the expense of future years?
Out of one side of their mouth they argue that Moto's couple of dollars/device is a totally outrageous licensing fee, given the % of a said device's capability relies on the patents involved (as if being able to play video and do wireless hardly matters to an Xbox) ... and out of the other side, negotiate - only under NDA, of course, because darkness fears the light - for on the order of $15 patent licensing fee for each Android devices, for what the temporarily-courageous Barnes & Noble leadership showed to be be patents that covered a ludicrously small part of said device's capability.
"Ahh! I see you're in that indeterminate Schrodinger state where - oh, uh
"if the best Google can earn from those patents is a few pennies-per-unit from its rivals' products, that may undermine the whole idea of paying $12.5 billion primarily for Motorola Mobility's intellectual-property portfolio".
In this day-and-age patent portfolios are bought so as to protect you from getting extorted by the other fella, as such it was a good buy.
AccountKiller
this website has turned to shit. I haven't logged in for years.
unfortunately I found a terrific yet too much info alt about 2 weeks ago on my tablet and didn't bookmark it....
anonymous coward browsing days are quite limited. /stops holding on /violins play
$10,000 CHALLENGE to Alexander Peter Kowalski
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You can see my dilemma. What if this is merely a ruse by an APK impostor to try and get people to delete APK's messages, perhaps all over the web? I can't be a party to such an event! My involvement with APK began at a very late stage in the game. While APK has made a career of trolling popular online forums since at least the year 2000 (newsgroups and IRC channels before that)- my involvement with APK did not begin until early 2005 . OSY is one of the many forums that APK once frequented before the sane people there grew tired of his garbage and banned him. APK was banned from OSY back in 2001. 3.5 years after his ba
Seriously, you need to get a new hobby. Turn off the pooter, go outside, walk on a freeway or something.
Put a cap on market capitalization of Google to prevent these scams
Casteism
You're embarassing yourself Jeremiah Cornelius http://slashdot.org/comments.pl?sid=3581857&cid=43276741 since you posted that using your registered username by mistake (instead of your usual anonymous coward submissions by the 100's the past 2-3 months now on slashdot) giving away it's you spamming this forums almost constantly, just as you have in the post I just replied to.
Well, Google certainly has the money... http://www.statista.com/topics/1001/google/chart/977/googles-amazing-growth/
You fail it, Paul. Your skill is not enough.