Google Sells Motorola Mobility To Lenovo For $2.91 Billion 172
_0x783czar writes "Google today announced that they will be selling Motorola Mobility to Lenovo for the sum of $2.91 billion USD. Google says the move should allow the company to receive the attention and focus it deserves in order to thrive. From the announcement: '[T]he smartphone market is super competitive, and to thrive it helps to be all-in when it comes to making mobile devices. It's why we believe that Motorola will be better served by Lenovo — which has a rapidly growing smartphone business and is the largest (and fastest-growing) PC manufacturer in the world. This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere.' Google was quick to add that this does not signal a move away from their other hardware projects. Additionally Google will 'retain the vast majority of Motorola's patents,' which they hope to continue using to stabilize the Android ecosystem. The deal has yet to be approved by either the U.S. or China."
Re:ouch! (Score:5, Insightful)
They didn't "rent" anything -- they paid $10 billion for Motorola's patents. The rest wasn't worth much to them.
A great American company sold to China (Score:4, Insightful)
Re:Google is keeping all the IP... (Score:5, Insightful)
Given that Motorola (through the StarTac, DynaTac and MicroTac litterally INVENTED the mobile phone as we know it today, it makes sense that they would have a big patent portfolio.
Re: ouch! (Score:5, Insightful)
Not at all, Motorola seems to be making better phones now, and Google has the parents. I assume the purchase was very hedging, in case android as an ecosystem didn't take off, they could try to make them alone. The need to hedge is over, Google gets some money, and a company that has proven it's ability to manage american brands is in the mix.
Google can now release moto based nexus items (if they dream moto to be good for it), without threatening the ecosystem.
The hedge on android probably was worth it to them.
This was always the point (Score:5, Insightful)
Re:Ouch (Score:4, Insightful)
As I pointed out elsewhere, this isn't the only sale from that purchase. Look here
http://www.forbes.com/sites/ti... [forbes.com]
They already sold off parts of that 13 bn for 2 bn in cash and 15% stake in another company. This makes another 2 bn. They also got to keep the patents, and got massive tax writeoffs for years. They may have come out ahead on cash (depending on the tax writeoffs) and definitely ended up buying those patents for a few billion max.
Re: ouch! (Score:5, Insightful)
Not at all, Motorola seems to be making better phones now
WAY better phones. In fact, except for problems like no SD card slots or removable batteries, I think they're making arguably the best phones in the market. Moto X is no Optimus G2 in terms of speed, but it's plenty fast, its battery lasts the whole day and it has brought something new to the table: voice commands. I think it's pretty useless, but at least it's something new. Notifications that take advantage of the AMOLED display were also cool. Moto G is simply the best value for money right now, it's putting every other phone maker to shame. Both can take a fall and are already running KitKat. If you remember Motorola had the Razr HD going against Samsung's Galaxy S3, you can recognize they improved Motorola's game immensely. Maybe Lenovo will carry the momentum, but I fear not. It's a shame, because I really liked where Motorola was going.
Re: ouch! (Score:5, Insightful)
Not at all, Motorola seems to be making better phones now, and Google has the parents. I assume the purchase was very hedging, in case android as an ecosystem didn't take off, they could try to make them alone. The need to hedge is over, Google gets some money, and a company that has proven it's ability to manage american brands is in the mix.
Google can now release moto based nexus items (if they dream moto to be good for it), without threatening the ecosystem.
The hedge on android probably was worth it to them.
Android had already captured about 75% of all hanset sales by the time the Moto Buy happened.
So I don't think they were hedging.
However, you might have hit the mark after all, in a slightly different way: Preventing Android from being eroded.
Its entirely possible there was a quietly brewing manufacturer revolt going on due to Google competing with its user base by manufacturing phones.
Samsung leaked a Tizen Phone [digitaltrends.com], and Mozilla funding a phone OS (paid for by Google, as is 95% of everything Mozilla does), and the Chinese also brewing up a phone OS, it might have come to Google's attention that getting rid of Moto might have been the best choice.
They keep the patents, secure Android's future, and already pocketed the tax write off when acquiring Moto's debts. Win, Win, Win.
Re: ouch! (Score:5, Insightful)
Conversely, the biggest problem with the purchase for Google is that it could make the other Android device manufacturers nervous that Google would give Motorola preferential treatment. In turn, they might contemplate a jump to Windows Phone, Samsung's Tizen, or the Chinese fork of Android called Aliyun.
So to me, what Google did here may have been expensive, but I can see the logic behind it. They stop Motorola from extorting the other Android device makers. They move Motorola's devices from 'suck' to 'decent'. They strengthen their own patent portfolio in the Intellectual Property Legal Wars. Then they sell off Motorola so that it's clear they won't screw the other Android vendors to strengthen the brand they own.
Re:ouch! (Score:4, Insightful)
That said, the Motorola purchase seems particularly insane, the only logical reason for Google to make that purchase was to build their own phone which is something they didn't even try.
"Patents". [wsj.com].