Google’s proposed $12.5 billion acquisition of Motorola Mobility throws up the big question ….
Why?
* First and foremost, buying cellphone, set-top boxes and tablet vendor Motorola Mobility for $12.5 billion (a 63% premium over Friday’s closing price) is a tacit admission by Google that ultimately Apple’s closed model of controlling all aspects of the smartphone experience (hardware, software and AppStore) is superior.
All but the diehard Fandroids would acknowledge that the iPhone or iPad user experience is far superior to Android be it in the user interface, availability of apps, security or developer support for the platform. We’re on our second iPhone and first iPad (V.2) for the most part have no complaints. Reviews of Android devices have rarely approached anywhere near the gushing praise its primary rivals, the iPhone or iPad.
It’s true that Google’s Android software has made considerable inroads in the smartphone market with 150 million devices and 550,000 activations a day. But when multiple vendors are peddling Android and the widgetry is cheaper than the iPhone, then 150-million doesn’t look that earth-shattering a number as it does on first blush.
* Second, Motorola has amassed a huge cache of patents, an area that Google has found itself to be at a disadvantage vis-a-vis Apple and Microsoft. Motorola has 17,000 patents and 7,500 patent applications.
Android vendors have already seen lawsuits from Apple, Microsoft and Oracle. From Google’s perspective, the patent outlook must have seemed pretty grim. With the acquisition, Google has muscled up on patents and provide a tough challenge to any rival in the court-room. Google executives made no secret today about their intention to protect the Android ecosystem.
* Third, the problem of fragmentation of Android must have been high on the minds of Google executives. While it’s true that fragmentation never occurred with Windows despite multiple PC vendors selling it, with Android there are two layers – manufacturer and carrier – before the gadget reaches consumers’ hands adding to the complexity of rolling out features, pushing updates, security fixes and getting more software developers on board to build apps for the Android platform.
* Fourth, the deal gives Google’s mobile ad programs a big boost by providing a huge captive base of phones to play with. With so much captive real estate available, the sky is the limit for what Google can do with it. For instance, Chrome can be the default browser, and easy access buttons for Google Local Pages/Place Pages can be offered on the Motorola phones.
* Fifth, Google can now be the default search engine on hundreds of millions of phones and tablets.
* Sixth, Motorola’s set-top boxes provide an entree for Google to launch a renewed push into the TV market where its success to date has been limited.
* Just Kidding: Finally, Google wanted to make desi boy and Motorola Mobility CEO Sanjay Jha richer by $90 million (thanks to Jha’s severance agreement). 😉
Android OEMs Screwed
If we were Android licensees HTC, Samsung, Sony Ericsson and LG Electronics today, we’d be looking for long, sturdy ropes.
After forking out $12.5 billion, it’d be mighty cavalier on Google’s part toward its shareholders not to screw rival Android vendors and provide preferential treatment to Motorola vis-a-vis Android. The only question is, not if but how soon is it gonna happen. Of course, today all of them pretended to be one happy Android family in order not to spoil the party.
Wonder how many people remember that Apple’s Mac cloning program did not last long.
We’d venture to say the writing is clearly on the wall for HTC, Samsung, Sony Ericsson and LG.
Do they have strong options?
No, unless they want to jump on the failed Windows mobile bandwagon.
Android OEMs are well and truly screwed, caught between the Scylla of Google on one side and the Charybdis of the iPhone on the other side.
Concerns
On the flip side, for Google integrating 19,000 new employees can’t be easy although Motorola Mobility is supposed to operate as a separate unit.
Second, Google has little experience peddling hardware apart from the Google Appliance it used to offer a few years back.
Third, Motorola’s hardware (phones, cable modems and set-top devices) is a low-margin business and Google will find it hard to raise them to the level of Apple’s fat margins given that technology is only one aspect of a consumer device. The ooh-aah factor that Apple has managed to achieve with all its devices be they iPhone, iPad or the new Mac AirBooks is very hard to replicate unless you clone Steve Jobs.
Whether Google wins or Apple manages to stay ahead, interesting times are certainly ahead and we could at last see real competition for the iPhone/iPad and their fat margins.
And competition is always a good thing for consumers.
Why is Google Buying Motorola Mobility? added by SearchIndia.com on
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Apple and Google’s progress makes one wonder whether Microsoft is still a player in the mobile/tablet space.
SearchIndia.com Responds:
Not unless there’s a miracle.
Between Android & Apple iOS, Windows Phone has no hope in hell.
Spoken like a true fanboy.
Can’t cure the lotus-eaters who live in their own cuckoo-land, sucking Steve’s d***.
Anyway, I think the main reason for the take-over is the patent portfolio. The rest is irrelevant. OEMs will do just fine as this company will be run as a totally separate entity, so much so that, it would have to bid for the opportunity to manufacture the next Nexus device, just like any other manufacturer.
Off topic, an interesting bit on a horny old desi pervert – http://www.msnbc.msn.com/id/44148882/ns/travel-news/
SearchIndia.com Responds:
1. You write: Can’t cure the lotus-eaters who live in their own cuckoo-land, sucking Steve’s d***.
Each time you write a comment, we’re reminded of the phrase hoist with his own petard.
No sooner do you praise Android Tablets, than the Android Tablet vendors start offering up to $200 discounts in a desperate, futile effort to get consumers to pick them up.
No sooner do you praise Android phones, than Apple shows more market share than any single Android vendor.
No sooner do you slam iPhone, than a key Android vendor (Motorola) puts itself on the block.
If any one’s deep-throating here, it’s you, boy!
2. You write: OEMs will do just fine as this company will be run as a totally separate entity, so much so that, it would have to bid for the opportunity to manufacture the next Nexus device, just like any other manufacturer.
Your naivete, apparently, has no limits.
Google owes a duty to its shareholders to screw other Android licensees and provide preferential treatment to Motorola. In plain English, they call it Business. Comprende?
Whatever hard object you have stuck deep in your throat, come back to us after two years when Android licensees Samsung, LG etc have dropped out & then we’ll remove it.
Don’t be surprised if one of the Android licensees hangs to Steve Ballmer’s skirts now.
Kiddo, talk is one thing, action is another. Learn from your President Barack ‘Double-Faced’ Obama.
3. You write: Off topic, an interesting bit on a horny old desi pervert – http://www.msnbc.msn.com/id/44148882/ns/travel-news/
Queen Anne is dead (a phrase meaning you’re giving us stale/old news).
Is it too much to expect that you’ll write something fresh/new, at least, once in 2 years.
Your favorite blog SearchIndia.com covered this desi pervert four months back – NJ Desi Mistakes Continental Flight for Cuntinental
Since we’re in a pleasant mood thanks to Gilbey’s Gin & Magnum Chocolate Ice Cream bar, we’re being kind to you today.
BTW, did you see Kangana/Shriya yesterday? 😉
Just kept the Kool Aid flowing. First it was ‘Android will never beat iOS’. Once that was accomplished, it now seems to be ‘No single Android phone manufacturer can beat Apple’, which is unfair in the first place, given that there are so many. Android users have so many options – so the market tends to be divided.
Which is why what Samsung has accomplished is awesome – their Galaxy S phones are already outselling the iPhone in Japan. And the trend is starting to show up in the rest of the world as well – http://www.pcmag.com/article2/0,2817,2389172,00.asp
Make no mistake, I am not deriding the iPhone – it is a great phone, if you don’t talk much, or as Steve would put it, if you hold it right. Or if you don’t mind dropped calls. It looks slick and Steve Jobs is way ahead of the pack when it comes to marketing. But the fact is, I can do more with my Android phone better, and that is all I care about.
As for tablets, I don’t see this trend happening, at least in the near future, as they are considered ‘non-essential’. There is no denying the fact that, if there is a tablet market, it is because Jobs managed to create one with the iPad.
Excuse me if I don’t follow this blog, for all the news of the world. I just login, when I feel like punching someone in the face 🙂 Or if my friends want to have a laugh at some juvenile blogging 🙂
SearchIndia.com Responds:
1. You write: what Samsung has accomplished is awesome.
Rubbish!
Samsung was selling in excess of 100 million mobile phones before Apple even launched its first generation iPhone in 2007.
Like most mobile phone vendors, Samsung got clobbered by the Apple iPhone and they jumped at the Android lifeline Google threw them.
And today, they’re trailing Apple in smartphones. http://arstechnica.com/gadgets/news/2011/07/apple-samsung-top-smartphone-sales-as-feature-phones-begin-to-decline.ars
Now, even Samsung’s Android lifeline is hanging tenuously after Google’s purchase of Motorola Mobility.
As we said earlier, each time you start typing you provoke mirth.
Seriously, take an ax to your fingers the next time you develop the itch to post a comment.
2. You write: I can do more with my Android phone better, and that is all I care about.
More junk unless you’re using your Android phone to rub it against your crotch.
Let’s not remind any one there’re over 425,000 apps for the iPhone that work without fear of viruses.
Don’t let the facts get in the way of your juvenile “All I care about” claims in the face of over 100 million iPhone units sold by Apple.
3. You write: As for tablets, I don’t see this trend happening, at least in the near future, as they are considered ‘non-essential’.
With Apple commanding over 60% market share and the Android tablet vendors discounting desperately, it’s safe to say Apple iOS will stay ahead in the Tablet arena for at least a few years.
4. You write: Excuse me if I don’t follow this blog, for all the news of the world. I just login, when I feel like punching someone in the face
Now you are speaking like ‘Rombhu Nallavan’ Vadivelu after a vicious beating. 😉
“More junk unless you’re using your Android phone to rub it against your crotch.” – Ukkandhu yosippingalo? 🙂
SearchIndia.com Responds:
Attribute that line to an overdose of Gilbey’s Gin. 😉
Well written article!
This move will give the much needed fillip to the sagging Windows Phone market. Though are very new into the market, the Windows phone UI is a very original concept. I like that.
The issue for me with the iPhone (I own one) is the rigid file handling capabilities, there is no multiple delete (say, delete multiple contacts at once) and the epic issue of carrier locking. I got my iPhone4 in Japan and I paid the full money towards the handset charges, but still I cannot use it in India. Worse still, they wont even unlock it for a fee!
But the above mentioned issue is only limited to migrant populations like me.
I feel Android will take over Apple because, the rate of innovation at Google has been very quick. Android was released in 2008 and already we are into the 8th iteration, compare it with the iOS which was based on the Mac OS platform and was customized and a certain parts rebuilt for the Phone form factor and it is still in version 5. Another example could be the chrome browser, where the rate of innovation and bug fix and release is mind boggling.
Also, iPhone is showing signs of decline in Japan already.
http://lostinjapan.groth.hm/archives/2010/11/iphone-losing-market-share-in-japan/
http://androidcommunity.com/android-beats-iphone-for-market-share-in-japan-20110511/
Even I could vouch for that because I am seeing a lot more ads promoting the iPhone these days, it was never like that when iPhone waslaunched. Also, the Japanese users are so used to their feature phones usage, that some of them find the switch to iPhone difficult, but with Google the phone makers like Sharp, Fujitsu and Panasonic find it a lot easier to customize the platform and tailor the user experience to the Japanese need.
SearchIndia.com Responds:
1. You write: but with Google the phone makers like Sharp, Fujitsu and Panasonic find it a lot easier to customize the platform and tailor the user experience to the Japanese need.
That was yesterday.
Sharp, Fujitsu & Panasonic must be on tenterhooks now to realize their Android rival Motorola Mobility is now owned by Google.
2. A lower-priced, iPhone Lite if you, will could stir up the markets a lot.
3. You write: I feel Android will take over Apple because, the rate of innovation at Google has been very quick.
Currently, all Android vendors combined have a higher market share vis-a-vis Apple.
But we doubt that’ll stand as we expect Android licensees Samsung, LG etc to slowly drop out.
4. Regarding Windows Phone, we’re skeptical they’ll amount to much if past history is any indicator of the future.
Microsoft came in with the heavy baggage called Windows into the mobile market and got kicked out.
Now they are coming in when the market is nearly saturated and everyone is looking for the next new innovation. They have always lagged behind in this race and they show no sign of differentiation.
SearchIndia.com Responds:
Bing & Windows Phone will be the two big albatrosses round Microsoft’s neck.
Sucking the blood ($$) out of it.