Editorial: Engadget on Google's Motorola Mobility acquisition

Google's announcement today of its planned Motorola Mobility acquisition may come as a surprise to some, but Moto's dedication to producing Android handsets, along with its recent $56 million Q2 net loss and comprehensive patent portfolio, make this a logical next move for Mountain View's search giant. Operating independently -- for the near-term, at least -- both companies will cooperate to grow Android, while Google claims that it will remain committed to its other partners as well. So what will this mean for Google and the future of the smartphone industry as a whole? Jump past the break for our thoughts.

Tim Stevens:

There are two ways to look at Google's acquisition of Motorola Mobility, and which one is your favorite depends a little on your degree of optimism on the business world as a whole. From a glass-half-full standpoint, this is just Google looking to get a little closer to the hardware world, making a smart acquisition to establish a long-lasting relationship with a company that can help it make top-tier devices to go along with its increasingly top-tier operating system. Sure, Moto's current offerings aren't always there yet (just hold a Xoom in one hand and a Galaxy Tab 10.1 in the other to see for yourself), but with a little bit of Google mojo injected in there, that could all change.

Of course, it doesn't take much of a glass-half-empty perspective to see this in another light. Maybe this is just Google making a hasty acquisition to establish a long-lasting relationship with a company that can help it stand on firmer legal ground in upcoming patent duels. This is of course in regards to Moto's bulging patent war chest, which CEO Sanjay Jha just last week threatened to mobilize. If this is your take, it's easy to see this as just another step toward ensuring that any salvo fired in a patent fight will end in Mutually Assured Destruction Bankruptcy.

The truth likely lies somewhere in between, but given Moto was already exclusively focusing on Android for its smart, mobile devices, I hope you'll forgive me for feeling like a bit of a pessimist this afternoon.

Darren Murph:

Here's the thing that I keep asking myself: why does Google want in on the hardware business now? I vividly recall speaking to HTC representatives during the peak of the Nexus One, and it was made fairly clear then that Google had bit off a bit more than it wanted to chew by being a handset seller. As much as I appreciate Android, one area where Google has consistently fallen short in the consumer space is support; Google's suite of online productivity apps is as important to some as Microsoft Office, but good luck phoning anyone at Google for help. I'm still dealing with an unsolved Calendar issue that the company refuses to acknowledge on its own forum. I say all that to offer this: I think Google's buying tech support, in a sense. There's no way to grow Android as a platform (and to take another whack at the hardware game) without having a proper support infrastructure, and Moto might just provide that. This angle also sounds like one that the antitrust mavens in America would soften their hearts to, clearing the way for a smooth acquisition.

One thing's for sure: you'll know just who to kvetch at if your pal's HTC Holiday gets Ice Cream Sandwich before your future Motophone.

Zach Honig:

With incredibly close ties to hardware manufacturers, Google's acquisition of Motorola Mobility is sure to cause some rumblings in the smartphone industry. Google claims that it will remain committed to its other partners, but I can't help but assume that Moto will end up acing Android 101, with direct access to the teacher's edition, after engineers have a chance to bump shoulders around the Googleplex. Patent acquisitions aside, this marks a significant jump beyond software for Google, into the land of manufacturing contracts, limited margins, and fierce competition at home and around the world.

The company's mobile network partnerships could also help its new Moto arm to take the upper hand with service providers, better positioning Google to dictate terms rather than leaving Motorola to obey instructions from AT&T, Sprint, and Verizon, for example. The acquisition will play a key role in rolling out future Google products as well, including Wallet, for example, which requires specific hardware to operate. That service launched exclusively with the Samsung Nexus S 4G, but it wouldn't be unreasonable to see Wallet roll out on a Moto handset next, and perhaps even across the entire product line -- in the US, at least.

Brian Heater:

It's the patents, stupid. For the all of the congratulatory talk of innovative handsets and home theater systems, today's acquisition news is really about one thing: defense of Android. The ecosystem is under threat from lawsuits waged by some of the largest names in the mobile business, so Google has taken the arguably drastic measure of dropping $12 billion and change for a company with an impressive arsenal of patents -- 17,000 and counting.

Such protections are not unusual, of course -- at the end of last month, the software giant plunked down money for 1,000 IBM patents as a means of protecting itself from legal challenges. Protecting oneself these days is less about innovation than stockpiling the innovations of others. Not that Google has ever been any stranger to innovation, of course, but the company got a late start in the mobile space, and given the broadness of many of the patents we've seen granted, it's essentially impossible to release a handset without stepping on plenty of toes.

And while you could practically hear the grinding of teeth as fellow Android handset manufacturers like HTC welcomed the news with "open arms," these companies have far more to lose, should Android go away entirely. Google, for its part, was insistent that Motorola would maintain some degree of independence. It's key that the company hammer this point home as much as possible, lest it risk the good will of its biggest supports -- this means, for one thing, allowing other companies a shot at producing the annual flagship Nexus device that the company briefly touched on during the earnings call.

Christopher Trout:

Hello, GoogMo. Google and Motorola may not have the charm or good looks of Brad and Angelina -- and they certainly don't have the same zeal for child rearing -- but if ever there was a coupling worthy of a one-word moniker, it's this one. This particular acquisition shouldn't come as a shock. Google's been searching for a way to beef up its patent portfolio, while Motorola -- not one to understate the size of its IP package -- has fallen behind the varied Android competition. What this partnership will bring -- beyond a more defensible little green robot -- is anyone's guess, but I for one am keeping my fingers crossed for an end to Motoblur.

Terrence O'Brien:

What exactly does Google snatching up Motorola's mobile phone division mean for the average consumer? Probably not much. While we wouldn't be surprised to see Page, Brin and Rubin have some hand shaping future Moto handsets, the chances of the company drastically shifting gears from maker of many Android phones to just an outlet for flagship Nexus devices are slim to nil. Perhaps future Droid generations will switch back to vanilla builds of the mighty Goog's mobile OS, and maybe updates will land on them in a more timely fashion. But, the truth is, this is all about the patents. Motorola is the holder of more than 17,000 patents that should help buffer Google and its mobile partners against the recent onslaught of litigation.

At least on record, other Android phone makers are supportive of the move, but that could change if Google turns Motorola Mobility into a vehicle for dictating its vision of dessert-themed devices. Will it become the exclusive provider of Nexus hardware? Maybe. But, for now, this is more about stuffing big G's arsenal with legal ammo.

Billy Steele:

Well... from a legal/patent standpoint this surely is interesting. My question is this: does the move by El Goog set some sort of precedent for other companies in the midst of legal battles? For example, would Apple consider a purchase of a nice chunk of Samsung's portfolio to protect themselves in the future? Who knows. But it certainly does make for some worthwhile conversation. Companies beginning to pad their libraries to avoid the courtroom is certainly a market variable that will be something to keep an eye on in the near future.

The reaction from other device manufacturers will be crucial. Let's reserve judgment for what this means for the fate of the Nexus family for a bit, as any number of scenarios are likely to play out. And until some solid development is underway, perhaps we should not jump to any conclusions about the future market dominance of said device. Although, it is something to look forward to, no doubt.

Daniel Cooper:

I think it's less about patents and more a reaction to a perceived land-grab by Google's rivals. Microsoft owns Nokia in all but name, HP bought Palm, Apple appears to be unstoppable. Buying Motorola does two things: cements Google's position in the mobile space and quells the potential for a costly rebellion. It was only four days ago that Motorola Mobility's CEO, Sanjay Jha said the company was "open" to adopting Windows as a mobile platform.

Other Android phone makers should be concerned. Google repeatedly promised that it would never make its own handset -- and subsequently made the Nexus One. Now it promises to run Motorola as an independent company; but $12.5 billion on a company that made a loss of $56 million last quarter? How long will it remain independent if it continues to take such big losses? Check back in three years and see if Motorola hasn't become Google's de-facto mobile division.

Brad Molen:

In today's world full of patent wars and company acquisitions, it's hard to be taken completely by surprise by the Google / Motorola deal. El Goog's $12.5 billion deal is a small price to pay if it gets Microsoft (and plenty others) off its back. But there's another aspect to the deal that isn't getting the same level of emphasis: the enterprise. Motorola's been the one Android OEM turning its enterprise features into a priority, attempting to win customers over from the likes of RIM. If Google can properly utilize Motorola's strength in this field, it's one crucial step closer to busting down the last fort the BlackBerry maker has left. Or, perhaps more extreme, the search giant just wanted to get rid of a large burden on Android formerly known as MotoBlur. Either way, this acquisition will likely be a winner for Mountain View.

Lydia Leavitt:

Google's acquisition of Motorola puts it in direct competition with Apple as a mobile company, rather than a technology company with mobile tendencies. Why? Because like Brian Heater said, the move adds more ammo to Google's arsenal in the form of patent protection, because of Motorola's pre-existing 17,000 patents. With said patents, Google can produce a truly competitive Android product. Aside from being somewhat of a defensive move, acquiring a hardware manufacturer is key to strengthening NFC and support for Google Wallet. The $12.5 billion Google shelled out for Motorola is merely chump change if the company can indeed capture the mobile payments market first through a hardware-wide launch. If everyone is paying for coffee using Google Wallet on their Motorola phones, the incentive to buy a Motorola Android phone has just increased ten-fold. Think of it like a giant Google Bank.

Joe Pollicino:

I've seriously got a headache today. Waking up on my couch dazed and confused after a long night of writing, I did what I'm sure quite a few tech geeks did: opened my browser to get news on TabCo (a-ha! It was Fusion Garage all along). Within seconds of scrolling though, my mind was blown: Google acquired Moto Mobo? So now what? Moobo? Goobo? My brain is pounding just thinking about it -- and oh geez, it's only Monday! Sure, I'm hesitant about a big merger, but if Google can get Moto to finally kill any remnants of Blur while letting it operate mostly on its own terms, what's not to be okay with? There's obviously support from competitors like HTC and Sony Ericsson, so that's good. Right? Mainly, I hope this will help push the true vision of Android en masse, rather than the plethora of fragmentation we currently have. Bravo y'all, please don't make me regret my joy in the near future.

Myriam Joire:

Wow... I didn't see this one coming! This is as big as Microsoft's partnership with Nokia or AT&T's intent to acquire T-Mobile. If you look at Google's history of "pure Android" devices, HTC's Nexus One was a hit, and so was Samsung's Nexus S. Motorola's Xoom? Not so much -- I'd even argue that it was an unmitigated disaster. So why this acquisition, and why now? After all, $12.5 billion isn't exactly pocket change, even for Google. In the short term, this is clearly all about patents and defending the Android ecosystem. Looking beyond that, it's about having more direct control over devices for a tighter, more Apple-like vertical integration of services, software, and hardware. Motorola's Photon 4G shows that the manufacturer can still hit a home run, so perhaps we'll see free Google phones, tablets and set-top boxes with free wireless service in exchange for more ads and less privacy. The only ingredient missing now from Google's portfolio is a wireless carrier -- yes, we're looking a you Sprint.

Dante Cesa:

So apparently Google went out and bought Motorola Mobility, eh? While it certainly seems like a great exit for Sanjay & Co., I can't help but feel a little nostalgic about the Moto that once was. You know, that American telecommunications badass behemoth that was once a real force to be reckoned with -- the company that brought us the friggen StarTac and blew our minds with the impossibly thin RAZR. I think a lot of us thought the Droid would be Moto's comeback device, and while it did cement Android as a legitimate OS contender, unfortunately that cash windfall never came. As for Google's relationship with the rest of the OHA partners? That remains to be seen. But I don't need to remind you that it's an incredibly tough tightrope to walk: just ask Palm, or Nokia.

Richard Lawler:

Google's purchase of Motorola Mobility and its impact on the all-out patent warfare that has surrounded Android recently has been more than adequately dissected by many others here, so I'll focus on its relationship to another huge, consumer facing part of Motorola's business: set-top boxes. Google TV launched last year and among its many missteps, suffered greatly by trying to toe the line of being a friendly add-on to consumer's existing cable or satellite TV experience instead of offering some sort of replacement or smooth integration with them. In a future where Google owns Motorola, it has directly purchased access to the relationships with TV providers worldwide that can make internet content and apps seamlessly melded with the TV people already love to watch a real possibility. While we wait to find what fruit is borne of initiatives like AllVid, the folks at Mountain View can immediately get to work building a cable box experience that doesn't make us want to prick our eyes out.

The danger here of course, is that the thought pollution flows the other way. While the mobile arena has its Motoblur and bloatware cross to bear, cable and satellite operators have fought hard to keep forcing their poorly designed interfaces on the public at large, and Motorola has been an enabling partner. While early looks at Google TV v2 are encouraging, just as important as UI and technology changes will be the company's ability to convince old-world TV providers who are just dipping a toe into more-open TV platforms with internet content and IP delivery that taking the shackles off and letting apps, ads and search shine in is a good idea.