Google buys Motorola Mobility for 12.5 Billion

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  • oceanmotion 15 Aug 2011 12:51:41 15,647 posts
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    Google to Acquire Motorola Mobility

    Combination will Supercharge Android, Enhance Competition, and Offer Wonderful User Experiences

    MOUNTAIN VIEW, Calif. & LIBERTYVILLE, Ill.–(BUSINESS WIRE)–Google Inc. (NASDAQ: GOOG) and Motorola Mobility Holdings, Inc. (NYSE: MMI) today announced that they have entered into a definitive agreement under which Google will acquire Motorola Mobility for $40.00 per share in cash, or a total of about $12.5 billion, a premium of 63% to the closing price of Motorola Mobility shares on Friday, August 12, 2011. The transaction was unanimously approved by the boards of directors of both companies.

    “Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers. I look forward to welcoming Motorolans to our family of Googlers.”
    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.

    Larry Page, CEO of Google, said, “Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers. I look forward to welcoming Motorolans to our family of Googlers.”

    Sanjay Jha, CEO of Motorola Mobility, said, “This transaction offers significant value for Motorola Mobility’s stockholders and provides compelling new opportunities for our employees, customers, and partners around the world. We have shared a productive partnership with Google to advance the Android platform, and now through this combination we will be able to do even more to innovate and deliver outstanding mobility solutions across our mobile devices and home businesses.”

    Andy Rubin, Senior Vice President of Mobile at Google, said, “We expect that this combination will enable us to break new ground for the Android ecosystem. However, our vision for Android is unchanged and Google remains firmly committed to Android as an open platform and a vibrant open source community. We will continue to work with all of our valued Android partners to develop and distribute innovative Android-powered devices.”

    The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US, the European Union and other jurisdictions, and the approval of Motorola Mobility’s stockholders. The transaction is expected to close by the end of 2011 or early 2012.

    Mobile sector heating up. Motorola probably have some nice patents but a similar going down hill dinosaur like Nokia.
  • Deleted user 15 August 2011 12:53:32
    My motorola phone is fucking shit.
  • NBZ 15 Aug 2011 12:56:05 2,351 posts
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    It's all about the patents - to stop android users/OEMS from getting sued.
  • Psychotext 15 Aug 2011 12:56:26 53,788 posts
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    What the fuck. 12.5bn? I've never even heard of Motorola Mobility.

    Edit - Ahh, they're the old mobile phone arm of Motorola. Makes sense.
  • Whizzo 15 Aug 2011 12:56:59 43,033 posts
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    The only Motorola phone I've owned went back to the shop within a week, it too was fucking shit.

    I'm not surprised the Motorola board was happy to accept a valuation 63% above market value, are Google insane?

    This space left intentionally blank.

  • Psychotext 15 Aug 2011 13:00:09 53,788 posts
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    So I assume this means Google will now be making their own handsets? I wonder how the other manufacturers (particularly Samsung) feel about that.
  • Deleted user 15 August 2011 13:01:52
    Psychotext wrote:
    So I assume this means Google will now be making their own handsets? I wonder how the other manufacturers (particularly Samsung) feel about that.

    They're probably not bothered as they'll be fucking shit handsets.
  • Ford 15 Aug 2011 13:02:14 398 posts
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    Perhaps sinking another $12.5bn into it will bring about profits somehow? Android is a total money pit.
  • NBZ 15 Aug 2011 13:03:16 2,351 posts
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    Google needed to do something like this to stop all the lawsuits from the likes of Nokia/Apple/Microsoft against anyone who built an android device.

    Pretty big news - I think they can allow the actual manufactiring side to be offloaded (and they may need to do this to keep other manufacturers happy) but the patents are essential to defend android.

    This levels the playing field a little.
  • oceanmotion 15 Aug 2011 13:03:29 15,647 posts
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    Yeah, all I've heard of Motorola phones is don't bother but I can say the same for Nokia and Sony Ericsson, I've had some right stinkers.

    Like NBZ said, patents seem to be the name of the game, they missed out recently so I guess they don't want to lose again and will pay a premium.

    Little war of words between MS and Google over patents
  • Chopsen 15 Aug 2011 13:04:43 15,704 posts
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    I hated my motorola phone, and I've never met someone who owned a Motorola phone that didn't think it was awful.

    NBZ wrote:
    It's all about the patents - to stop android users/OEMS from getting sued.

    How does that work?

  • mcmonkeyplc 15 Aug 2011 13:08:10 39,384 posts
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    Motorola phones are shit.

    Come and get it cumslingers!

  • oceanmotion 15 Aug 2011 13:08:54 15,647 posts
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    Ford wrote:
    Perhaps sinking another $12.5bn into it will bring about profits somehow? Android is a total money pit.

    As long as it protects and expands their core business and services, ads, search etc. it's a winner. That's Google after all. Same thing Microsoft does with Windows and Office. Protect the cows.
  • NBZ 15 Aug 2011 13:11:41 2,351 posts
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    Google could potentially start to indemnify OEM's against patent lawsuits so that they dont have to pay out big bucks (to toerh firms) to use android.

    Currently HTC (which is a pretty recent company without deep patent pockets) has to pay MS $5 for every android handset built and is also being sued by Apple (and Microsoft is making more money from its Android racket than from WIndows Phone 7).

    M$ want $15 from Samsung for every android handset built over alleged patent infringement.

    Big companies have thousands of patents and in a mafia protection racket style, they will go to other players and ask for a certain cut for not getting sued for patent infringement (though most of them may be invalid or of dubious quality, but if you throw enough shit, atleast some would stick). Now if the other side also has patents, they cross licence - allow both parties to use each others patents(and maybe some money exchanging hands if one sides patent pool is much larger).

    Now if one of the companies is pretty new or doesnt have a large patent pool, the fear of losing a patent case in court is quite huge (willful infringement = x3 the damages) and there is an urge to just pay up instead of risking losing a case which could put the small player out of business.

    Now, Mafia style, when someone goes knocking on the doors of e.g. HTC, they can tell them that they have the backing of Google and its patent portfolio, and its patent portfolio and can tell the other parties to simply do one.

    Motorola is a company that has been around a long time so it will have a huge number of patents - patents that cover real stuff too instead of patents and esigns and UI button placements etc that the likes of Apple/Microsoft probably own.

    Until now, when partners have been sued, Google has just stood in the sidelines watching as it did not have any large patent pool that it could defend them with (and just paying out would mean more rodents taking a sniff of the cheese).
  • Psychotext 15 Aug 2011 13:17:01 53,788 posts
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    NBZ wrote:
    Motorola is a company that has been around a long time so it will have a huge number of patents - patents that cover real stuff too instead of patents and esigns and UI button placements etc that the likes of Apple/Microsoft probably own.
    Not as many as you might think: http://i.imgur.com/SdPRbl.jpg
  • Rhythm 15 Aug 2011 13:17:03 2,462 posts
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    Patent lawsuits are fucking *massive* business in the States and a huge PITA to anyone trying to do business so something like this would actually be a cheap way to prevent litigation. As NBZ says, this package may well have counter-patents that mean they can stop each other having to cross-charge to use common tech
  • Ford 15 Aug 2011 13:30:01 398 posts
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    Psychotext wrote:
    NBZ wrote:
    Motorola is a company that has been around a long time so it will have a huge number of patents - patents that cover real stuff too instead of patents and esigns and UI button placements etc that the likes of Apple/Microsoft probably own.
    Not as many as you might think: http://i.imgur.com/SdPRbl.jpg

    Very interesting graph. If it's about patents then I'd expect more acquisitions to follow, as that piece of raw data suggests it's nothing of the sort.

    Motorola had fleeting success with the RAZR line but I don't think much of their products other than that. Xoom was a failure as well.
  • TakeTheVeil 15 Aug 2011 13:35:59 5,058 posts
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    Motorola is a much bigger brand in the States than in Europe.. mainly due to the huge success of Razor over there.

    Of the phones I've hand my hands on, the Milestone line of Android phones were great too.. Atrix and Defy have had very good reviews.
  • NBZ 15 Aug 2011 13:44:51 2,351 posts
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    Ford wrote:
    Psychotext wrote:
    NBZ wrote:
    Motorola is a company that has been around a long time so it will have a huge number of patents - patents that cover real stuff too instead of patents and esigns and UI button placements etc that the likes of Apple/Microsoft probably own.
    Not as many as you might think: http://i.imgur.com/SdPRbl.jpg

    Very interesting graph. If it's about patents then I'd expect more acquisitions to follow, as that piece of raw data suggests it's nothing of the sort.

    Google is also acquiring $1billion worth of patents from IBM.
  • crashVoodoo 15 Aug 2011 15:31:59 3,850 posts
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    I know this is moto mobility and not moto overall but does this give them an avenue into motos set top box channel with regards to google tv ?

    a Nexus a day keeps the apple away

  • Cadence 15 Aug 2011 15:57:45 1,677 posts
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    The Razor is one of the worst phones I've ever used, god knows why it's so popular in America.
  • grey_matters 15 Aug 2011 16:27:35 3,671 posts
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    This might increase the likelihood of Microsoft buying Nokia. Especially with their insistence in concentrating on WP7 and not releasing the N9 on contract in the US or UK (or Germany too I think). Bizarre decisions leading to massive stock price drops which in turn leads to possible take-overs. There is a serious pile of important patents at Nokia.

    Edit: impotent -> important :)
  • Peew971 15 Aug 2011 17:08:25 4,703 posts
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    NBZ wrote:
    Google needed to do something like this to stop all the lawsuits from the likes of Nokia/Apple/Microsoft against anyone who built an android device.

    Pretty big news - I think they can allow the actual manufactiring side to be offloaded (and they may need to do this to keep other manufacturers happy) but the patents are essential to defend android.

    This levels the playing field a little.
    It doesn't make much sense to offload the manufacturing side, they could have bought/licensed the patents for a portion of the price. Yes the deal is a lot about patents but if they bought the whole thing it's also to control Android hardware a la Apple. Eventually other OEMs will get pissed indeed and move to Windows Phone (unless Microsoft buys Nokia/RIM then the only option left is Web OS).
  • Ryze 15 Aug 2011 17:09:22 3,121 posts
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    I doubt they'll have to bother with handsets, as they may end up alienating their partners, by becoming their biggest rivals in the marketplace.

    As others have mentioned, it's the PATENTS that are critical here.
  • Peew971 15 Aug 2011 18:01:05 4,703 posts
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    Ryze wrote:
    I doubt they'll have to bother with handsets, as they may end up alienating their partners, by becoming their biggest rivals in the marketplace.

    As others have mentioned, it's the PATENTS that are critical here.
    Yeah but why not just buy/license the patents for A LOT less? Motorola needed the money anyway. I find it hard to believe they would purchase the whole company not to make handsets.
  • Feanor 15 Aug 2011 18:03:04 14,053 posts
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    Ford wrote:
    Perhaps sinking another $12.5bn into it will bring about profits somehow? Android is a total money pit.

    And totally worth it to stop Apple owning the market.
  • bitch_tits_zero_nine 15 Aug 2011 18:15:41 6,654 posts
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    Had a Razr.. Piece of crap.
  • Deleted user 15 August 2011 18:24:23
    Feanor wrote:

    Ford wrote:
    Perhaps sinking another $12.5bn into it will bring about profits somehow? Android is a total money pit.

    And totally worth it to stop Apple owning the market.
    Inthought Android now had the biggest Market share? Or is that only mentioned when convenient.
  • Deleted user 15 August 2011 18:27:44
    Seems that way.
  • Ryze 15 Aug 2011 19:39:59 3,121 posts
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    Peew971 wrote:
    Ryze wrote:
    I doubt they'll have to bother with handsets, as they may end up alienating their partners, by becoming their biggest rivals in the marketplace.

    As others have mentioned, it's the PATENTS that are critical here.
    Yeah but why not just buy/license the patents for A LOT less? Motorola needed the money anyway. I find it hard to believe they would purchase the whole company not to make handsets.

    True - I've just had a read up, and they're announcing that they're running it as a separate business!

    Ooops. They need to be careful that they don't lose HTC, Sony, Samsung etc to Windows Phone in the mid/long term.
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