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.