Google’s acquisition of Motorola Mobility more than just a patent play

August 15, 2011 § Leave a comment

The buzz around the GOOG/MOT deal is all about the 17,000 additional patents that Google will have both to innovate its platform, and maybe more importantly, to defend itself against the onslaught of suits currently making their way across the mobile industry.  I certainly don’t dispute the importance of the patent portfolio.  But I think Google has more up its sleeve, namely:

  • Access to a tightly controlled, standardized development environment.  Google has been criticized for the freedoms it has granted developers in the past, essentially letting them run amuck.  Great for independent developers, and perhaps one of the reasons for Android’s popularity.  Maybe even a necessary ingredient for the Android app universe to catch Apple’s.  But now that they’re close enough to parity, the downside of the approach has become more apparent.  Major upgrades to the Android OS  have to get pushed to multiple environments, not just one.  Innovation is slowed.
  • Android’s openness has also cost the platform in the area of security.  Too hard to tack down the many implementations of its software.  The closed-loop environment with Motorola handsets should allow Google to batten down the hatches, so to speak, and create a model environment for other OEMs.
  • Google offers to handset makers for “free”, with the understanding that broad distribution will ultimately lead to advertising opportunities.  Google may be thinking it’s time to pay the piper, and a tie-up with Motorola will enable it to experiment with tightly integrated advertising solutions over the OS.

No doubt, there are risks to consider.  With Motorola under its wing, Google could alienate other handset makers just enough to drive them closer to rivals, namely Microsoft (despite Google’s promise to run the unit independently, and to maintain its commitment to open development).  Similarly, MOT’s cable set top box business now falls into the hands of a parent with a track record of attempting to challenge the strength of established cable and telco players.  But if they balance their strategy right, and I have no reason to suspect they won’t, they will maintain their good standing, and improve their lot in the mobile arena.  I count this deal as a strategic “win” for Google.

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