Google Acquires Motorola Mobility for $12.5 billion
John Borkowski, August 15, 2011
Announced today, Google purchased Motorola Mobility (widely known as the builder of Motorola’s cellphones and tablets) for $12.5 billion. Motorola Mobility significantly helped the company return to stronger revenue with its line of Android based smartphones. Some analysts say this shines light on future plans for Google (including the development of Google Tablets), however most say that this move is more about securing patents.
The company has gotten itself in to some patent lawsuits and has since been buying the rights to various patents across the board. CEO Larry Page discusses “We recently explained how companies including Microsoft and Apple are banding together in anti-competitive patent attacks on Android”. Page further states that “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.”
Google competes against Apple in the smartphone industry by making smartphones on Android open-source. Apple’s iOS is closed-source. By doing this, Google wants Motorola, Samsung, and HTC to allow them to customize the software to their liking. This has led to a bitter battle between Apple, Google and Microsoft. Since Google gives the operating system free to smartphone manufactures, Apple and Microsoft are seeking a way to make them pay $15 licensing fee for all smartphones made on the Android system.
The acquisition of Motorola Mobility acts as a hedge against this and tries to give the company more patents in its on-going dispute with rivals Apple and Microsoft.