Google agrees $12.1bn deal to buy Motorola

Google agrees .1bn deal to buy MotorolaAnd there we were, just about to call it a slow news day. Well, Google has blown that out of the water by agreeing a $12.1bn deal to buy out Motorola.

It officially gives Google a very real presence in the mobile hardware game, but it's a different kind of property – intellectual property – that's the real key to this big money mega-deal.

As usual with acquisitions of this size, it's not just a question of agreeing a price and handing over a rather large cheque. There are all kinds of hoops to be jumped through and legal red tape to be negotiated. But in principle the deal has been agreed.

It will see Google take full ownership of Motorola Mobility – the mobile arm of Motorola which was formed when the parent company effectively split in two a couple of years back.

It will ensure Google a direct presence in the mobile hardware business, something it's clearly been angling for after all those Nexus phones and a tablet (a pair of which were made by Motorola, incidentally).

But it's Motorola's rich library of patents that's seen as the real draw for Google, especially in the current climate of royalty agreements and legal disputes.

And we have to imagine that the deal was already well advanced when Google SVP David Drummond made a very public criticism of the patent culture in a blog post 10 days or so ago. Clearly this, not just a critical blog post, is Google's response.

But it will be interesting to see how the other Android smartphone manufacturers react over the next few months to the buddying up of Moto and Google. After all, there were some rumours of discontent when Nokia and Microsoft signed a partnership back in February, and that was just an agreement to work together, rather than Microsoft plunging itself directly into the hardware business, as Google is effectively doing now.

Certainly the other Android phone makers were making all the right noises in the wake of today's announcement, all making predictably consistent noises about the move being about “defending Android”. But time will very much tell what the real long-term repercussions are, and Microsoft itself will be keeping an eye on things, willing to snap up new recruits for its Windows Phone brigade should it see any signs of discontent.

In the end, much may depend on just how the merger manifests itself in the next round of Nexus product releases. So for Motorola has been the hardware partner of choice for the first Android Honeycomb tablet (the Xoom), while HTC and Samsung have taken the firms behind the Nexus One and Nexus S handsets respectively. Should the Android Ice Cream Sandwich-bearing Nexus debutant carry Motorola's name, we imagine the Android chorus might not come across quite as united as it does right now.

Read more about: Android

Add a comment

JanSt / MOD  Aug. 15, 2011 at 19:41

To go off on what LC here calls a Jan-tangent: I'm not exactly thrilled to see Google go to bed with Motorola who already share a lovenest with the US government.... (it's not very obvious, but if you research Moto's shareholders, you'll know what I mean)

Andy247  Aug. 15, 2011 at 20:12

Here's hoping it leads to a more 'global' approach from Motorola with software updates and handsets being seen more quickly in the countries outside of the US.

JanSt / MOD  Aug. 15, 2011 at 20:20

Since the RAZR not a single Moto's been offered by any irish network. Nada. Zilch. Guess that'd change with G-force

iampav  Aug. 15, 2011 at 22:31

A shame that recent, solid handsets like the Milestone 2 and the defy haven't really captured the imagination. Certainly trying to locate the former on contract not too long ago was impossible.
Clearly without the cash from sales to fund innovation - unsurprising since the company didn't kick on from its umpteen iterations of Razr and Krzr - it has seen an opportunity within a jumpy, patent-waving market to get-out in a shareholder pleasing way : sell up, handing a no-doubt solid, patent proprietory library to the Goog.

asssvvvvxc  Aug. 15, 2011 at 23:53

good deal for Google

shuwaz  Aug. 17, 2011 at 00:16

Do you think this means Motorola handset owners will finally get Gingerbread on their devices now (or even Froyo for that matter)? (_;)


You don't need an account to comment. Just enter your email address. We'll keep it private.