Our favourite internet search giant Google has purchased Motorola Mobility for a staggering amount of $12.5 billion in, wait for it, cash. This means that Google has paid Motorola Mobility $40 per share and as compared to Motorola Mobility’s share price of last Friday, Google has acquired them at a 63% premium per share. Was Google desperate to buy or Motorola Mobility desperate to sell?
Before we delve in the details of Google buying Motorola Mobility, the obvious question that’s popping up in Android lovers’ minds is that, what happens to Android now? To answer this question, we’ll let Google do the talking:
The acquisition of Motorola Mobility, a dedicated Android partner, will enable Google to supercharge the Android ecosystem and will enhance competition in mobile computing. Motorola Mobility will remain a licensee of Android and Android will remain open. Google will run Motorola Mobility as a separate business.
This is basically legal speak for “Android remains open, you got nothing to worry about folks”. One must understand though, that Motorola Mobility, which used to be the Mobile Devices division of the parent company Motorola until January 2011, has for far too long been dedicated to the Android platform. The company went all out Android when it initially launched the Droid on Verizon Wireless. We’ve seen some really impressive devices being released from Motorola Mobility and now after being acquired by Google, we’ve a little hunch that the next Nexus smartphone of Google just might be developed by Motorola Mobility. Won’t they be a bunch of happy campers now?
Now there’s something about this deal that’s bothering us. Nevermind the fact that this acquisition was totally out of the blue, there were no rumours about this. So why would Google suddenly decide to dish out $12.5 billion and buy Motorola Mobility? The answer: patents. According to the Motorola Mobility website, the company owns 14,600 granted patents whereas it currently has 6,700 patents pending approval worldwide. Now that Google has bought the company, this huge amount of patents is now Google’s property and they’re bound to be happy about it.
Google has been stuck in patent wars with its arch rivals, Apple and Microsoft. While the two companies gave Google a very hard time when it wished to acquire the Novell patents, Google deemed it fit to put such an offer to Motorola Mobility, that they could not refuse the proposal. So right now, a lot of head scratching is bound to be underway at Cupertino and Redmond, given the fact that not only did Google just buy Motorola Mobility, it bought a humongous lot of patents as well.