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Google has just announced that (subject to usual regulatory approvals)it will acquire Motorola Mobility for $12.5 billions in cash. Here's my first take on the news:
  • ​Intellectual property. As has been widely reported, Google’s IP assets are currently pretty weak. Continuing to develop Android without shoring up the patent portfolio might well have meant that the “Android tax” on every device using the operating system would have got dangerously steep. With Motorola’s IP clout on its side Google can actually fight back rather than just paying out more and more, time after time. Just check out what Motorola Mobility’s CEO commented last week. A coincidence?
  • Hardware/software integration. I don’t personally think that the lack of in-house hardware has so far been a huge drag on Android, but now Google will naturally have full control over the HW/SW integration. Add to those two dimensions the social one (Google+) and Google an edge. Apple lacks its own social network; Facebook lacks its own OS and handsets. Google does the whole triangle. That will go down well with social app developers, and it’s apps that will make or break Google+.
  • Microsoft. The Windows Phone vendor is the odd one out now, as it doesn’t do hardware – yet. I’d assume that Google’s takeover of Motorola Mobility will heat up the M&A rumors around MS and Nokia/RIM.
  • ​Mobile operators vs. OTT. In-house hardware will add to Google’s over-the-top capabilities in voice and messaging – consider this yet another blow to the operator industry. The day when the world’s first Soft SIM hits the market is drawing closer.

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