Google's purchase of Motorola's smartphone business at a 63% premium, suggests the dominant search engine firm is rattled
A company that can dip into its back pocket and pull out $12.5bn (£10.9bn) in cash to buy a major customer can hardly be said to be on the ropes. Nevertheless, Google's agreement to pay $12.5bn for smartphone maker Motorola Mobility looks a defensive move to repel what it calls a "hostile, organised campaign" against its Android software. The supposed organisers of the legal assault are Microsoft, Apple and other software giants. The 63% takeover premium says Google was rattled.
Welcome to the world of technology patents, where battles to protect intellectual property rights have become intense in the age of the smartphone. Lawyers, rather than developers, are becoming the most important employees at big technology firms. Pharmaceutical companies will know the feeling.
The prime attraction of Motorola to Google seems to be its 17,000 patents protecting innovations in mobile technology. Armed with these, Google chief executive Larry Page thinks he can better protect Android against "anti-competitive threats".
He may be right, but other handset makers who use Android, such as HTC, Samsung and LG, may be less than impressed to find that their supplier of software now has an in-house manufacturer of hardware. All sides appear to have agreed to leave that conundrum for another day – the handset makers expressed support for the Motorola deal. But smiles on day one, when presented with an agreed takeover they cannot influence, do not mean permanent harmony.
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Source: http://www.guardian.co.uk/business/2011/aug/15/google-motorola-takeover
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