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Slashdot Asks: Why Does Google Want To Purchase HTC? (bloomberg.com)
Rumor has it Google is planning to purchase HTC -- or at least a portion of it. The speculation of this has been doing rounds for weeks now, and it reached a new high today after HTC said its stock will stop trading from Thursday, as it prepares to make a "major announcement" tomorrow. Bloomberg reported today: Alphabet's Google is close to acquiring assets from Taiwan's HTC, according to a person familiar with the situation, in a bid to bolster the internet giant's nascent hardware business. HTC, once ranked among the world's top smartphone makers, is holding a town hall meeting Thursday, according to tech website Venture Beat, which cited a copy of an internal invitation. The shares will also be suspended from trading as of Sept. 21 due to a pending announcement, according to the Taiwan stock exchange. Of course Google has made similar moves in the past. It previously owned Motorola for a brief period of time, but that acquisition didn't materialize much. The company has however, since re-hired the Motorola chief it once had, Rick Osterloh, and founded a separate hardware team under his stewardship. Claude Zellweger, the one-time chief designer of HTC Vive, is also now at Google, working on that company's Daydream virtual reality system.
What reasons could Google have to purchase HTC? Share your thoughts in the comments section below.
What reasons could Google have to purchase HTC? Share your thoughts in the comments section below.
I think the better question is what's different about this time. They already tried buying a device maker once with Motorola (although to be fair Motorola was trying to put a gun to Google's head with patent threats) and while they produced some interesting devices, none of them caught on in the market and they ended up unloading the company a few years later to Lenovo.
I'm curious what their plan is this time around, or they're just buying another slumping handset manufacturer to prop them up for a few years until they realize that they aren't making any money and end up selling the company to a Chinese manufacturer interested in buying the brand.
You misspelled patents.
In 2011, VIA technologies sold its graphics subsidary "S3" to HTC, my guess is the are actually interrested in the Graphics Patents and knowledge from S3.
which state the obvious. 1) That HTC is a competitor in the same phone space and that 2) Google has money to burn.
There's a third reason.
Google doesn't know how to innovate anymore. They've gone as far as they can with computers as they are and don't want to sink time and money into finding the next new thing. Instead they're going through a retrenching so that profitability remains relatively high while seeking as many monopoly positions as they can. They already have search and internet advertisement sewn up. The US doesn't have the will to establish a new regulatory regime and the EU doesn't currently have the reach to force the US into following their course. That may change by the time President Stupid is done but that's for the future to decide.
In the meantime, the smart move is for Google to gobble up as much as it can under their Alphabet umbrella and see which keeps bringing in the money.
And HTC is the manufacturer of their current flagship phones, the Pixel and Pixel XL.
Google, well Alphabet really, wants money. It turns out, that if you make and sell things, you can get money!
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Might be a VR purchase. Just sayin. Google invested heavily into Magic Leap and it has been vapor. The google dream headset thing has registered a big fat zero. In all honesty Google needs to exit the hardware business, they suck at it. Google voice thing looks like an air freshener and no one wants it.
"Competing phone" doesn't make much sense.
Compared to the rest Google doesn't make much by selling phone. They are not harmed by the existence of manufacturer competing with Google's Nexus line.
They make maybe a little bit more by selling Android licenses to manufacturer who choose to have the complete "Google Experience" (including Google Play Store and other such Google apps and service) instead of the free AOSP. In that case, the more manufacturer producing Android phone, the better for Google, no matter which brand.
They make quite some significant money by taking a fee on all transaction to happen on the Play Store. Again, no real threat by "competitors". On the contrary : the more manufacturer making Android phone, the more potential customers who are going to spend to the Play Store.
Finally the biggest chunk of money, they make through ads. They don't even need android phones for that. Even Apple iOS users are potential eyeballs that they can sell to advertisers. They just need to have as many people going online so they can be exposed to ads, no matter *which smartphone* they use to do it.
(That's why Google is both *developing* their own Chrome browser AND *financially supporting* Mozilla's effort on Firefox. Firefox isn't a *competitor*, it isn't a product that is "diverting revenue" from Chrome - that would be difficult given that Chrome is free. They are both parallel mean to achieve what Google actually needs : people getting online on the net where Google can profit of them because they are the biggest advertiser).
None of the above will cause Google to see HTC as "competition" that they need to buy.
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Plus it gets the IP & knowledge base built on the patents, and the people that did it.
HTC used to make pretty decent devices, and I'm sure there's still some guys here who remember how its done.
It's sometimes much faster and cheaper to buy a team of talented designers and engineers, PMs etc. rather than build from scratch.
They have innovated the following:
The relationship between Handset makers and Google is a very tense one, to say the least.
That's why things like TouchWiz (Samsung), EMUI (Huawei), LGUX (LG) and other "Non-Stock android" UI still exist. Yes, those were necesities when Android's UI was primitive, and not to the liking of certain markets (Like South-East Asia, for instance).
If one of the big guys breaks up with google and slaps their UI on top of AOSP, or Bada, or BB10, the users would be none the wiser. Especialy in markets like India or Chine, were the dominant services are NOT Google's.
At the same time, google tries to move forward the ecosystem, both in terms of hardware capabilities (AR is the latest example), and in therms of Software updates... Sometimes, they try the carrot, sometimes the stick. After google got the Motorola patents, they used motorola for a while as one of the Sticks. Now, they need another stick... Enter HCT.
Alphabet will slurp any patents and interesting tech that HTC may have.
The phone division will make a couple of interesting handsets (the reference designs will still be awarded in a kinda-sorta-of-round-robin-fashion to partners like LG, Samsun, Lenovo, HTC itself, etc.), with very-close-to-stock-Android, and decent update cycles too. And after a few years, will be sold to some emerging handset maker in China or India, which is in the Top 10 global handset maker chart, but only by virtue of the sales in their home market, which needs a globaly recognized brand to help their internationalization (TCL owning the Alcatel, BlackBerry and Palm brands is a good example).
Then, after a few years, when Google needs another stick, they will buy yet another formerly great handset maker with a recognizable brand, and repeat the cycle...
*** Suerte a todos y Feliz dia!
They also get all of HTC's licensed agreements too. IIRC HTC had licensing deals for IP with Nokia, Microsoft, and Apple.
I doubt that's the case, unless they had some really odd licensing agreements. Licenses are (almost) always written to be non-transferrable for exactly this reason, so $bigcompany can't acquire them through the back door by buying $smallcompany.