gdgt

There's much more to this than just the technical handset aspect. Google had to acquire patent portfolio protection or android would have been sued many times over and have so many licenses attached that it could have become no longer feasible.

Business deals can happen in all sorts of ways. Google may have agreements in place with other handset vendors about what it will do with Motorola OR Google may have extended the patent protection it is acquiring to any dispute involving any handset running android (even if that suit is brought against Samsung, et all.)

Google possibly didn't want to become an electronics manufacturer but Google couldn't afford to not buy a patent portfolio. Motorola may have been the only one for sale at a price google could stomach.

The complexity goes on an on. When you're talking about 12.5 billion dollars and an entire ecosystem of other handset manufacturers I have to assume that Google did a lot of talking with a lot of people. This didn't 'just happen' it's been happening for some period of time and it's only now becoming public.

When Motorola Mobility split out they had 24,500 patents.

mediacenter.motorola.com­/Press­-Releases­/Motorola­-M...

For reference, the 6,000 Nortel patents sold for 4.5bn

Google's war chest is looking pretty massive now.

That's assuming all patents are of equal worth, which is opposite of reality.

Ugggggh. Patents.

I will say, I don't care if it's Google, Apple, HTC, Samsung, or anyone else. This constant patent litigation is only going to stifle innovation and hurt us as consumers. It's really annoying to wake up everyday and see a new headline that says "Apple sues Samsung over esoteric patents" or "Lodsys sues developers over obscure patents" or "Google sues Nokia over patents no one cares about."

That said, I wouldn't necessarily say that the number of patents is a fair comparison. This deal has more baggage than an airport. Google gains an additional 19,000 employees who work under a different corporate culture (that might not even be compatible with the rapid development cycle of Google's culture). They also get a subpar design team (seriously, compare any Motorola phone or tablet to HTC or Samsung devices -- it's no contest).

Maybe Google can put Motorola's UI team to use and port some of this "sweet" Motoblur goodness over to stock Android, right?

Seriously though, good luck to Google. I don't think this is the wisest move -- but in a lawsuit happy world, they probably needed to do this. Everyone is going after them for obscure patent violations, which is really ridiculous.

Well from the sounds of it they're going to keep Moto as a separate entity so I don't know if there'll be a culture shock there or not.

Damn near every merger starts with the acquirer saying the the acquired will keep its own culture. Safe to say you can't count on that holding true.

From the Blog Post:
“Motorola will remain a licensee of Android and Android will remain open. We will run Motorola as a separate business. Many hardware partners have contributed to Android’s success and we look forward to continuing to work with all of them to deliver outstanding user experiences.”

googleblog.blogspot.com­/2011­/08­/supercharging­-andr...

I disagree. Samsung, LG, and HTC already don't seem to care much about being on the cutting edge of Android versions since they have their own custom versions they maintain. If anything, it will save them some R&D dollars by keeping close tabs on what chips and chipsets Moto is using and simply tagging along to be sure they have full compatibility without having to worry so much over driver issues. Additionally, it is likely to help them in their patent wars as I imagine Google will be offering some patent sharing deals to their partners.

Besides, this doesn't parallel to the Mac clone business because Apple relied entirely on hardware sales to run their business, as did Palm. When clone makers undercut them, it hurt their bottom lines. Google has no major risk to themselves in this since they are already viable without a hardware business. This buys them patents and gives them a hardware vendor to use as a Labs project (no offense to the many Moto employees whose jobs are more important to their families than they will be to Google). If the hardware division becomes unprofitable, they will probably treat it like any other Labs project that isn't pulling in the required traffic.

Other OEM's won't care about being on the cutting edge of Android versions unless Google+Moto is successful being on the cutting edge of Android. If they are (and it's in Google's interest to be isn't it?) then the other OEM's will need to compete with their OS vendor, which isn't a good business to be in for obvious reasons.

The chipset argument to me seems to be one that says commoditizing phone hardware helps everyone, which it doesn't if you're counting on your hardware margins. Google doesn't care about hardware margins because they are an advertising company, the other OEM's clearly do care.

In the Mac clone example the clones were a problem because they could undercut Apple. Here Google could undercut their OEM's because they get so much revenue from advertising. You're assuming a multi-billion dollar company won't do that for some reason.

Margins are invisible to the consumer, though, because when you walk into Sprint, for example, you usually pay either $0, $49.99, $99.99, $149.99, or $199.99 for a new Android device. No one knows or cares about the actual cost of these except the reseller. So, will Sprint carry fewer HTC and Samsung phones just because they are paying more for them than they are for Moto phones? Not likely as long as people keep buying HTC and Samsung since Sprint's main interest is selling the plans. They might instruct their sales people to push the Motos harder, but sales people aren't going to convince anyone to buy a phone if it isn't well-built, regardless as to how hard they sell it.

Now, if we reach a point where the Motos are way ahead in build quality and innovation, as well as being a lot cheaper, and then the sales people push those harder... we might see a difference.

All that being said, I have a hard time believing that Moto will be able to undercut the margins of Samsung when Samsung makes almost every part in their phones. Moto still has to buy more parts from other companies, so, even with a free ride on Android licensing, I don't think they can build a phone cheaper than Samsung can.

As far as competing on the cutting edge, we geeks need to stop having so much self-importance, because that only matters to us. I'd be willing to bet that over 80% of all Android phone owners don't even know what version their phone is running. Nor do they care as long as it works. I can't say I really blame them, either. So I went from 2.2 to 2.3 on my EVO... and it looks the same to me. If anything, it is a downgrade since the battery life is worse. If this were stock Android, I might care a little more. I am always meeting people who are still running old versions of the OS on their iPhones and Androids because they had no idea that there was an upgrade or why they would want it. If anything, they don't want the upgrade for fear of something changing on the phone they are familiar with. For this reason, I think the manufacturers are less concerned about the cutting edge than we tend to be.

No matter how it plays out, this is going to be very interesting.

This morning I find myself happy to have an Atrix in my pocket. For some reason I irrationally feel like this purchase means that Goog will magically fix all the annoying bullshit that motorola did to this phone.

never thought of google getting rid of locked bootloaders because of this, I think that'll be my favorite part of this acquisition

I am with you on this one... awestruck and excited that Google is taking the next step. I also have high hopes for this. I had just talked myself into upgrading from the EVO to the Photon, and this makes my decision feel so much better. :) It also makes me feel hopeful that we will get faster updates with some pure Android. Is it too early to go to youtube and fire up "The future's so bright, I gotta wear shades"?

My thoughts exactly.

If those things happen they will COMPLETELY KILL Android's chances at HTC and Samsung. I'm guessing Google would rather they not abandon the platform.

I have been a part of two acquisitions now. Neither nearly as large scale as this. Experience tells me that externally visible rapid changes will not happen. The immediate upside gain for Goog was the patent portfolio but there are others that may be as or more significant.

This acquisition increases the size of Goog by 60%. Integrating all those new people into Goog culture from an old school corporation like Moto will be tough and take a lot of time.

I don't think we can expect the Moto teams to act with the kind of alacrity we're more accustomed to seeing at Goog. If Moto could work that way, Apple wouldn't be kicking everyone's their at Smartphone's.. (I know I'm glossing over a lot of details)

So while I have high hopes that this will mean something awesome for existing Motorola handsets I'm not expecting any visible changes for we consumers for months if not 18+ months for anything significant. Yet still I hope. ;)

It's hard to say what will happen because I think it definitely caught everyone off guard. let's hope for the best.