Google announced that it was buying Motorola for a staggering $12.5 billion. This is the largest acquisition made by the online search and advertising giant to date. I was talking about this with a friend who said the following. “If I’m a typical Motorola employee I’m worried, if I’m HTC I’m pissed, if I’m Microsoft I’m making a bid for Nokia, if I’m Apple, I’m laughing it up.” I’m not entirely sure about my friend’s statement but I am positive that Google has changed it’s strategy and decided to fight fire with fire, patents with patents, lawyers with lawyers, and mind share with truck loads of hard cold cash.
Google went at great lengths on this deal, it not only paid top dollar for Motorola but it even created a special “Facts about Google’s acquisition of Motorola” SEO-rich webpage which includes choice quotes from Android partners and a message from Larry Page.
Larry, CEO of Google, wrote about the purchase…
Motorola has a history of over 80 years of innovation in communications technology and products, and in the development of intellectual property, which have helped drive the remarkable revolution in mobile computing we are all enjoying today.
The last Motorola phone I thought was ground breaking was the first generation RAZR. Since then I have not been impressed with their phone offering, including their Android versions. In the press release, Larry made several references of the StarTAC, which Motorola originally released in 1996.
To appease other Android partners and licensees, the press release stated that Motorola will e a independent business unit.
This acquisition will not change our commitment to run Android as an open platform. Motorola will remain a licensee of Android and Android will remain open. We will run Motorola as a separate business
For me, the key and most revealing sentence in the whole press release was the following.
Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.
What struck me about the above quote is how hard Google is spinning this. When competitors buy up patents, it’s anti-competitive but when Google itself pays top dollar for a turkey stuffed with patents it will “increase competition.”
It has been reported that Google is paying $40/share, over 50% on top of the price at the time of the announcement. The reason Google is paying this price is clearly for the over 14,000 granted patents and over 6,500 pending patents Motorola has acquired over time. These patents will add to patents Google has added to it’s patent portfolio.