In Motorola, Google gets mobility testing lab
Everyone calm down. Nothing to see here.
The news that Google is buying Motorola Mobility has caused either widespread panic or euphoria, depending on how you look at things. But despite the huge numbers being thrown around -- $12.5 billion in a cash-only deal -- this is a predictable move from Google, does not cost them too large a percentage of their monetary pie, and will let them continue to do business as usual, only better.
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People need to remember that Motorola recently split its company into two pieces. Motorola Mobility, which Google is trying to purchase, only deals with making smart phones. Motorola Solutions does everything else. So Google is buying only the phone-making part of Motorola.
The deal still needs to be approved by the government, but given that the CEOs of competitors Samsung, Sony Ericsson, HTC and LG Electronics all embrace the merger, I don’t see any government regulators stepping in to stop the deal.
You might ask why Motorola’s former competitors (and arguably future competitors) would want Google to run the show. The reason is that Google makes its money off of Android sales. It’s the software that is important to them. But their one main weakness is the same one that affects Microsoft: no real access to a hardware platform builder. My guess is that Motorola Solutions will become a lab of sorts where Google can test and implement new features into the Android OS, which will then be available to all companies.
So the move makes the Android platform -- still struggling against Apple and RIM and WebOS and others – a lot stronger. This also gives Google the potential to compete better against Apple, which controls everything in the chain for all Apple OS devices. And all those other companies can benefit indirectly from Google’s investment of time and money.
Think of it like this: If Microsoft bought Dell, it wouldn’t suddenly tell every other computer manufacturer that they couldn’t buy Windows for their systems. Instead, one would think they would use their new-found hardware company to make Windows better.
So I don’t believe that Google will adapt a walled-garden approach where they try to own everything from the OS to hardware to applications. They won’t try to force everyone else out of the market. Google’s more open network approach works fine, and is a nice alternative to Apple’s closed society in a lot of people’s minds.
In fact, I would not be surprised if Motorola Mobility stopped producing phones all together -- for the public anyway -- after a while and instead just tested new OS versions and features, or even acted as an advisers to show other companies way to improve phones that could work with Android. In fact, I’ll go so far as to say that I expect that will happen fairly quickly after the deal is done.
John Breeden II directs the GCN Lab. Follow him on Twitter: @GCNLabGuys.