Our new Marketplace Crash Course is here to help. Sign-up for free, learn at your own pace.
Google buying Motorola
So this is a fine way to kick off a week in tech news. Google is slated to pay 12.5 billion dollars for the handset maker. The deal would put Google in more direct competition with Apple as a maker of both handsets and software.
The New York Times reports that Motorola also holds more than 17,000 patents and there has been a recent run on patent acquisitions and that:
Last month, Apple and Microsoft led a consortium of technology companies in a $4.5 billion purchase of roughly 6,000 patents from Nortel Networks, the Canadian telecommunications maker that filed for bankruptcy in 2008. Google, which lost out in the bidding, criticized the deal as an anticompetitive strategy. Several weeks later, Google paid $4.5 billion for more than 1,000 patents from I.B.M.
The patents are like foot soldiers in this litigation war that’s already started and should get a lot uglier. Google hasn’t had a lot of patents before and now it does.
Of course, the deal still needs to get some approval and if I’m a handset maker OTHER than Motorola, I’m pretty grumpy this morning. The thing with Google’s Android mobile operating system is that it’s supposed to run on all sorts of phones but doesn’t it seem at least possible that Android might run a little or a lot better on their own Motorola sets? And if it does, isn’t that what everyone chooses? These are arguments that will surely be put before the FTC.
THEN AGAIN, I just saw that four other handset makers are coming out with letters of support for the deal this morning. Again, it’s all about patents. Samsung and HTC are already being sued by Apple for patent infringements and, really, everyone in this industry is a hair trigger away from being sued by everyone else. But if this deal happens, the defendants can get backup from Google, which makes the Android system the phones run on, because Google needs those handset makers in order to achieve market dominance. And that support will be stronger than what they could have received from Motorola as a competitor.
Here are the eerily similar statements of support:
â€¢ “We welcome today’s news, which demonstrates Google’s deep commitment to defending Android, its partners, and the ecosystem.” –J.K. Shin, president of Samsung’s Mobile Communications Division
â€¢ “I welcome Google’s commitment to defending Android and its partners.” –Bert Nordberg, CEO of Sony Ericsson
â€¢ “We welcome the news of today’s acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem.” –Peter Chou, CEO of HTC
â€¢ “We welcome Google’s commitment to defending Android and its partners.” –Jong-Seok Park, CEO of LG Electronics’ Mobile Communications Company
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.