By Katherine Rushton, Telecoms, media and technology editor, Telegraph.
7:45PM BST 15 Aug 2011
Larry Page, Google’s chief executive, said the deal would “supercharge” its Android operating system and help to extend it into areas other than smartphones.
However, observers claim the deal is really about Google gaining ownership of Motorola’s 17,000 patents and 7,500 pending patents – a massive armoury it can use to defend the mobile phone producers using its Android operating system against a steady stream of legal battles over infringements of intellectual property.
Android is already used by Motorola, as well as a slew of other mobile phone manufacturers, including HTC, LG and Huawei.
The acquisition, which is still subject to competition approval, will put Google in direct competition with customers who use its operating system.
Buying Motorola will also give Google the firepower to fight Apple head on as a technology manufacturer. Apple is the biggest smartphone producer in the world, accounting for 18.5pc of all handsets shipped.
However, Android is the most widely used operating system used in smartphones. According to research firm Gartner, it was installed in 46.8m handsets shipped in the three months to June 30 – 43.4pc of the total market – compared to 19.6m iPhone handsets with Apple’s iOS operating system installed.
Google was swift to allay fears it might abuse its dominant position, saying Android will remain open source – meaning it is available for use by any manufacturer – and that Motorola will operate as a separate company.
However, some analysts were sceptical this would remain the situation long term and said rival mobile manufacturers were less happy with the acquisition than they indicated in statements shortly after the deal was announced.
Subject to regulatory approval the acquisition is expected to complete in late 2011 or early 2012. However, Mr Page said he does not anticipate any problems: “We believe strongly that this is a pre-competitive transaction. It has added competition, innovation and increased user choice… It is not a horizontal transaction. Google has not been in the handset business [before].”
By owning the technology in users’ pockets, Google will be able to gather more information about its customers’ habits and whereabouts, enabling it to leverage the strong relationships it has with advertisers even further.
Motorola is also a significant producer of television set top boxes, potentially offering a boost to Google’s on-demand service, Google TV.
Motorola Mobility was created in January this year when Motorola, the company which created the first ever mobile phone, split into infrastructure unit Motorola Solutions, and the company Google wants to acquire.
Source: Daily Telegraph
Google’s surprise buy of handset maker Motorola Mobility yesterday gives the search giant a fully packed war chest of patents, but it also means Google is inheriting a sizable amount of intellectual property litigation.
As noted by my colleague Marguerite Reardon, Google’s Motorola buy boosts its patent portfolio with more than 17,000 patents, along with another 7,500 patent applications that have been filed and are pending approval. That’s a giant step up for Google, which investment banking firm MDB Capital Group estimated to have just 317 mobile device patents granted within the United States at the beginning of this month.
During a conference call immediately following Google’s announcement, Google Chief Legal Officer David Drummond said the ongoing lawsuits between Motorola and other companies will continue and will be managed by Motorola just like they were before the sale. Drummond declined to talk legal strategy, short of saying that he believes Google is now in a “very good position” to be able to protect partners within the Android ecosystem.
That protection will be particularly important given that some of the suits have targeted Motorola for using Google’s Android operating system. As you’ll see below, that includes suits filed by Microsoft, security company Gemalto, and Apple, which has claimed that Motorola’s Xoom tablet (which runs Android) copied the iPad‘s design. There are numerous other suits that target Motorola on other patent-related issues, which could result in costly settlements and licensing agreements long after the Google-Motorola deal is closed.
Below we’ve chronicled some of the intellectual property suits flung at, as well as flung by Motorola Mobility, ranging from big battles with companies like Apple, Microsoft and TiVo, down to spats with intellectual property holders that have named it along with others for infringing on one or more of their patents. You can read more about each of the legal efforts beneath the chart: