The REAL Reason Google Bought Motorola Mobility Holdings

Posted on February 12th, 2012 by admin in Intellectual Property, Portfolio Diversification

Google’s acquisition of Motorola Mobility Holdings (Ticker: MMI) in 2011 caused lots of strategic confusion among all its stakeholders. Google claimed the deal was to ensure that by owning MMI’s patents that Google could protect its Android partners from IP suits such as the ones Apple launched against Samsung. Stakeholders worried that the acquisition would give MMI advantage over all other mobile phone makers using Google’s Android operating system. Google said they would, of course, be fair and treat all equally, but the pundits said that eventually Google would favor MMI and that the Android customers would adopt another OS, like Windows 8, in self defense.

So do these concerns still reflect the situation?

We think not. These concerns are still valid, especially absent the closing of the deal with MMI. But we think the deep motivation for Google to acquire MMI is to gain serious competence in embedded wireless systems (such as tablets, laptops and smart phones) to support the evolution of Google as a provider of a wide range of entertainment systems for the home

Consistent with and supporting this view is the report in the San Jose Mercury News. Here’s a snippet:

Google has intriguing plans at the Googleplex

By Mike Swift:

Posted: 02/12/2012 07:00:00 AM PST; Updated: 02/12/2012 08:27:05 AM PST

Google (GOOG) is in the midst of more than $120 million in construction projects at its Mountain View headquarters, including work on a series of new or previously secret hardware testing labs that hint at the Internet giant’s expanding interest in crafting consumer devices like its rivals Apple (AAPL) and Microsoft.

Among the projects, revealed by a review of public records by this newspaper, are a lab to test a new consumer product under the brand name “@home” that will wirelessly stream music or data to other household devices, apparently similar to a prototype home audio service Google demonstrated publicly last year. And, most intriguingly, Google is modifying a lab for a project enigmatically named “Project X,” which appears to involve precision optical technology and could be part of the secret technology projects Google co-founder Sergey Brin is heading.

Full story here:

Google will compete with Apple for the living room.


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