Mike Andrew Consulting

Google deal set to ‘supercharge’ Android

By mike, Aug 19 in blog with 0 comments

Google has struck its biggest ever deal – to buy Motorola’s smartphone and tablet business for $12.5 billion in cash.

Both companies say the move will give a ‘supercharge’ to Google’s Android platform.

Android-based devices, which include Motorola’s smartphones and tablets – are the major rivals to Apple’s iPhone and iPad.

As such, the acquisition appears to be a decisive effort by Google to tackle to dominance of Apple head on.

Under the deal, Google will buy Motorola Mobility for $40.00 per share, a price that is 63% over the closing value of Motorola Mobility shares on Friday.

‘Motorola Mobility’s total commitment to Android has created a natural fit for our two companies,’ said Google chief executive Larry Page.

‘Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers.

‘I look forward to welcoming Motorolans to our family of Googlers.’

Analysts said access to Motorola’s intellectual property had clearly been a major motivating factor behind Google’s purchase.

‘What Google are actually buying here is not a mobile phone business at all,’ said Ben Rooney, technology editor at the Wall Street Journal.

‘What they are buying is this enormous suite of patents that Motorola – which is one of the oldest mobile phone companies out there – has built up over the years.’

The 17,000-strong patent portfolio which will pass into Google’s hands would shield it well in the ongoing patent war between smartphone and tablet makers, he added.

Following a split eight months ago, Motorola is a company of two parts.

As well as the ‘Mobility’ arm, which makes phones and tablets, it also has a ‘Solutions’ division, which develops technology systems for industry.

Mr Page admitted Google did not have experience with manufacturing devices, and as such planned to run Motorola Mobility as a separate business.

However he stressed that Google had a strong track record with acqusitions, having made 120 purchases in the past few years.

In order for the deal to go through, Google needs the approval of Motorola Mobility shareholders and competition regulators.

It said it was confident the acquisition would be cleared because it protected the future of Android, which is an open-source platform used by several other mobile device makers.

Yet this situation may prove to be an obstacle.

Other smartphone handset makers who use Android will want reassurance that the platform will not simply be tailored to Motorola’s requirements in future, analysts warned.

About the author

Mike Andrew has been working with the Internet and small business for over 12 years. Mike has been a keynote speaker at conventions and seminars and conducted social media training sessions all over the world. Mike has an extensive media background having worked in electronic media for over 30 years. Mike specialises in social media and Internet marketing strategy, SEO techniques and search engine marketing campaigns. His articles appear on numerous blogs around the web as well as national magazines.