Google & Motorola

Very very interesting news about Google buying Motorola Mobility this morning. It’s got so many implications it’s tough to take in all at once, so wanted to capture a few thoughts quickly.

First thing worth pointing out, though, is this: we don’t actually know the shape of the whole deal at this point. Will Google keep the MOTO hardware business? Keep the patents and sell the hardware side? Keep both? It’s hard to know how their internal evaluation went, and what they’ll do from here, so a lot of this is really hard to speculate about.

Having said that, a few thoughts:

- it’s another instance in a long history of software (and now Internet) business devouring the previous generation’s hardware businesses. Internet business are inherently more leveraged: distribution power trumps almost everything else, especially in a phase where the technology portion is maturing.

- along those lines, it’s interesting to think about what happens next for Samsung, RIM, HTC, Nokia, but I’m way more interested in what the software players do. All eyes in that regard are on Microsoft, but I think the more interesting long term questions are for Facebook and Amazon.

- 2 things it’s clear that Google didn’t buy MOTO for: its margins or its ~20k employees.

- seems like Google definitely wanted the IP portfolio.

- and it seems to me that, assuming they keep the hardware business, that they want Motorola because it gives Google full control over the hardware and software stack, which is the only way that they’ll ever be able to even approach the excellent UX fit & finish of the Apple offerings. I feel like that’s one of the top drivers, and maybe the most important one over the long term.

- One other thing that this merger is decidedly not about is distribution — if anything, Google’s distribution power with respect to Android is somewhat weakened, at least in the short-to-medium term, as they’re undoubtedly going to cause some grief with partners Samsung and HTC. Feels like Google has calculated that control over getting the experience right trumps any distribution help they might get from their handset partners.

All of this lines up pretty well with my post about Screens, Storage & Networks last week — the last 60 days have seen Google push hard to get in the top tier on Screens (MOTO) and Networks (Google+).

My most esoteric point I’ve left for last, though: one of the unfortunate consequences of this development is that I think it will move perceptions of big corporations building open software (and in this particular instance, I’m specifically talking about open source software) at least a few more notches towards the cynical. The question that everyone will ask anytime a company tries an open experiment like Android in the future, the inevitable line of questioning will be: “Sure it’s open now, but for how long?” Whether premeditated or not, the path of Android has been from wide open to asserting more and more control — and this is another data point on that path. I’m not criticizing or indicting anyone for this — I think it’s essentially just a natural evolution and response to market conditions that require tighter integration. I think in a lot of ways it’s inevitable in technology networks for this to happen. (And I’ve written about it a bit before.) My only real sadness here is that it’ll move cynicism on corporate open source efforts up one more notch, and that’s not good.

Overall, though, fascinating day, fascinating time. Big moves!

8 comments

  1. Samsung must presumably ask Google for patent protection against Apples Lawsuits. In return, it got strangled by Google. Reminds me the story about the sheep asking the wolf to protect it against the fox…
    Long term, Google will not be able to compete against Apple on consumer products. Samsung and HTC may join Microsoft camp. Or, may be, Samsung might snap RIM?
    Will Amazon still announce their Android tablet?

  2. As soon as I read the title I thought immediately of the article you referenced (Screens, Storage, Networks) and how Google has now put their fingers in all the applicable pies. I didn’t even know at that point that you were the same person writing this, but it immediately put together so many puzzle pieces in my head.

  3. I get the feeling that you (and @Shai Sole above) have misunderstood something. At least according to official statements
    a) the acquisition was done mainly to protect Android and it’s partners from patent pressure by Apple, Microsoft and other companies
    b) other Android partners of Google approve of this decision
    c) the purchose of Motorola will not affect Android being free software.
    Thus, I don’t really get where you got that from, that Google is trying to “strangle” other partners.

  4. Hum I think Nokia is already in bed with Microsoft so you shouldn’t even look at them anymore.

  5. Apple sells their devices at a premium because they sell a premium experience, like buying a BMW or a Lexus. Everything, from your experience at the Apple Store, to the packaging, to the attention to detail in the UI, to the way you buy content on the iPhone, is designed to be compelling and beautiful. It has less to do with the fact that Apple controls both the hardware and software, and more to do with culture. Design is in Apple’s DNA, and part of everything they do, including who they hire and how they work together.

    Google and Motorola, on the other hand, do not have what I would call a Design culture. Google has shown they can be pretty good at usability through simplicity, but their products aren’t exactly what I would call beautiful or compelling. Motorola, well… I’m not sure if anyone really knows what the culture is at Motorola.

    Saying you can add two companies who don’t have a design culture together to make Apple, is like saying if you merged GM and Chrysler together they could compete with Mercedes.

  6. Ive thought that this whole thing has stunk since the second I read about it on The Register. Neither Motorola nor Google have ever been companies Ive particularly liked, and Ive been wondering if the Motorola acquisition isn’t just another move in the ongoing patent/IP war with Oracle, Apple, and Microsoft. If it is, its not a great way to inspire confidence in its now competing Android handset manufacturers as to the viability of Android in the medium and long terms.

    Any Android manufacturer with sense is probably seriously considering moving to Microsoft or taking a look at Intel’s MeeGo now though.

    But what still doesn’t make much sense to me is why Google would do this to the mobile phone sector while depending on Samsung for its nascent Chromebook. Yes, Acer is also producing them but Samsung is in a much better position in Asia, and among those of us in North America as well as Europe which remember how truly awful Acer PCs used to be.

    Google has basically sent out three signals here, firstly that Google doesn’t believe much in the Chromebook (and therefore its truly “homegrown” software development, remember Android started out with Google as an acquisition) if they’re willing to take a slash at Samsung’s tendons in such a way as acquiring a rival corporation and entering into direct competition against them in their strongest sector, and Secondly that Google will throw you under the bus at the first opportunity to gain leverage.

    Thirdly I get the sense that the left hand has no clue whatsoever what the right hand is doing at Google. And thats a signal that indicates to me that upper-level management is either not communicating or different divisions within the company simply don’t care if they weaken each other.

  7. While you may have been right with the screens, storage & networks, I hope you are not with respect to the open source software.