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August 22, 2011, 5:18 pm UTC
Google buying out Motorola changes the tech world’s brand landscape forever.
The tech world last week woke up to the dazzling news of Google buying up Motorola for $12.5 billion. This is one of the largest acquisitions in the tech world and would have a far reaching impact not only in the world of technology and business, but would also alter the brand landscape in interesting ways.
First of all this is an extremely interesting acquisition, considering that both companies are pioneers in two fields that are converging rapidly. Motorola is the one that literally started the mobile phone revolution while Google did the same with the internet. The coming together of the two companies thus makes for a spicy mix that should spur up both the internet and the mobile market wars.
At the face of it, this acquisition will double Google’s workforce. Motorola with over 17,000 patents and another 7,500 pending ones would obviously give a boost to Google’s wireless ambitions. And Google understands this as Larry page wrote in a blog that the “acquisition of Motorola will increase competition by strengthening Google’s patent portfolio.”
Interestingly the buyout announcement came less than two weeks after Google lashed out at the tech-trinity - Microsoft, Apple and Oracle for waging a ‘hostile, organized campaign against Android’, a war they said was ‘waged through bogus patents.’ The acquisition of so many patents would thus give Google the much needed arsenal in its armory to fight off competition against its Android platform.
Over the years, Apple and Microsoft have become aggressive in pressing patent claims against those vendors in America who sell devices based on Google’s Android operating system. This was expected considering that Android, since its debut in 2007 has been free and almost half the devices in the world come with Android. Thus, the operating system monopoly that Microsoft had with Windows during the days of the PC, now Google has when one considers smart phone. Also, despite the growing popularity of Apple’s iPhone and iPad devices, it has not been able to make a dent on Android.
The two companies have thus upped the ante against Android and thus Google. Microsoft successfully sued Android device manufactures like HTC, which is paying an estimated $5 extra revenue every time an HTC device with Android is shipped to the US. The Motorola acquisition thus falls strategically into the scheme and Google Chairman Eric Schmidt said that “Google would not aggressively defend Android manufacturers from the patent suit of its competitors”.
The Motorola acquisition thus put Google in the centre of the Android patent wars in an interesting way. So far Google was defending hardware companies that used Android, but only as a software manufacturer. The Motorola acquisition also makes them a hardware company that makes a large share of the world’s Android devices. It thus has a stake in the war, both in terms of hardware and software. Thus the war that Apple and Microsoft have been waging fairly successfully with small Android device manufacturers just got tougher for them with the insertion of a giant right in the middle of the battlefield – Google.
However, this acquisition has also scared hardware manufacturers like HTC and Samsung that are in direct competition with Motorola. This has led Larry Page to emphasis that “This acquisition will not change our commitment to run Android as an open platform" while also stating that. "Motorola will remain a licensee of Android and Android will remain open. We will run Motorola as a separate business”. It will thus be interesting to see how Google manages walking through this tight rope where on one side as a software manufacturer they work together with companies like HTC and Samsung while on the other hand as the owner of Motorola also compete with them.
Yet, amidst it all one thing is for sure. This acquisition marks a very interesting change in the world of tech brands. Global brands are like countries with their own borders that they aggressively defend. This acquisition forever changes these borders in the tech world. Obviously a major tech brand war is brewing on the horizon.
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