Google & Motorola Mobility: The What’s It All Mean Edition

What a way to start the week. The company that once said it would never build its own mobile phones, Google, wants to buy mobile phone maker Motorola Mobility. The technosphere has gone into 5G coverage over the news. Here’s what I’ve been finding interesting and some thoughts.

Patent Protection

A big part of this is about patents. You might recall two weeks ago that Google make a big stink that Microsoft and Apple were, in Google’s view, trying to chop off Android’s big head with a patent guillotine. Our background coverage, on that:

Picking up Motorola means that Google picks up Motorola’s patents, as Google highlighted in its blog post today:

Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies.

More on this came out in the conference call from Google and Motorola on the news, as reported by AllThingsD, where Motorola talked of having 17,000 patents and another 7,500 pending. Apparently, Google believes that by owning these patents, it will be better able to extend protection over the entire Android ecosystem.

By the way, Samsung has 37,000 mobile patents, followed by LG with 31,000, then Motorola, according to a Piper Jaffray chart that eWeek has here.

Mama Bear Google & Her Android Cubs

To my understanding, neither Microsoft nor Apple has actually sued Google itself over over whether Android violates their patents on mobile devices. Rather, those companies have gone after hardware manufacturers, either with actual lawsuits (Apple versus Samsung; Apple versus HTC) or demanding licensing fees (Microsoft versus HTC).

Google, which views Apple and Microsoft as effectively bullying its Android “children” now might be stepping forward to say that if you’re messing with its baby bears, you’re going to have to face mama bear Google.

Maybe that will work. Maybe it won’t. One thing’s for certain. Those Motorola patents didn’t cower Microsoft away from suing Motorola over Android back in October. Foss Patents has some further background here. Now Google’s going to inherit that suit.

If Google should win, potentially HTC might question the agreement it struck with Microsoft over patents and try to get out of that, if it could. Other Android handset makers would no doubt take heart from any victory. This would also go to support Google’s suggestion that the Motorola deal really is about helping the entire Android ecosystem.

Should Google lose, potentially it harms Android greatly — because if mama bear can’t win, the baby bears are toast.

Baby Bears: We Love You Mama (Don’t Hurt Us!)

Google’s major Android partners are all happy with this move! After all, Google’s lined up statements from them all that say so:

“We welcome today’s news, which demonstrates Google’s deep commitment to defending Android, its partners, and the ecosystem.” –Samsung

“I welcome Google‘s commitment to defending Android and its partners.” –Sony Ericsson

“We welcome the news of today‘s acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem.” –HTC

“We welcome Google‘s commitment to defending Android and its partners.” –LG

Then again, what would you expect these companies, which have so much invested in Android for their future, to say? By and large, these statements mean nothing. Actions in the coming weeks and months will speak much more loudly.

Microsoft As The Independent OS?

One of those actions, ironically, could be to strengthen the prospects for the Windows Phone mobile operating system.

If you’re a handset maker looking for a mobile OS, you’re not going to get it from Apple. Now, you may feel less comfortable banking on Google. Sure, you’ve got a few other options like potentially webOS from HP. But Microsoft will be the lone big player not actually making handsets. As AllThingsD quotes Gartner analyst Michael Gartenberg:

“There’s no doubt they are going to have to give Windows Phone more serious consideration than they ever would before,” Gartner analyst Michael Gartenberg told AllThingsD. “On the other hand, they are still smarting from the Nokia deal. But at least Microsoft hasn’t taken that final step of going into the hardware business themselves.

Ah, yes, Nokia. The company that Microsoft did a billions-dollar deal with earlier this year, to get it to go all Windows Phone-specific. Good deal for Nokia, as the company restated today at GigaOM:

This further reinforces our belief that opportunities for the growth of Nokia’s smartphone business will be greatest with Windows Phone. This could prove to be a massive catalyst for the Windows Phone ecosystem. Additionally, with our respective intellectual property portfolios, Nokia and Microsoft are working together to build and nurture an innovative ecosystem that benefits consumers, operators, developers and other device manufacturers.

Then again, it’s hard to think that other hardware manufacturers, watching Nokia effectively having been turned into Microsoft’s phone division in all but name, might feel that’s reassuring for them.

More likely, they’re now weighing up what’s the best of bad situation.

Does Open Mean Not Playing Favorites?

Of course, Google itself would decry any suggestion that Android isn’t open. Saying that Microsoft’s mobile OS is “open” in any way would likely cause some at Google to turn red in outrage.

But what exactly is open? If open means that you put a version of your software out whenever you want, for others to use however they want, I suppose Android wins.

Android doesn’t look so open when it means that some hardware makers get the latest edition ahead of others (Android 3.0 with Motorola; TidBits has some nice history here) or when you suggest that Android really isn’t Android unless Google seems to decide it is, as in the Skyhook case.

If you’re a handset maker, open probably is far better defined as whether an OS doesn’t appear to have favorites. Apple’s clearly does: Apple. Google seems likely to favor Motorola. Microsoft seems likely to favor Nokia.

Microsoft Made Us Do It!

For its part, Google might try to reassure nervous partners that it had no choice but to try for Motorola. After all, as GigaOm reports, Microsoft was apparently interested:

Our sources say that Motorola was in acquisition talks with several parties, including Microsoft for quite some time. Microsoft was interested in acquiring Motorola’s patent portfolio that would have allowed it to torpedo Android even further. The possibility of that deal brought Google to the negotiation table, resulting in the blockbuster sale.

Of course, more reassuring might be that Google gets the patents, then strikes an agreement to license them out to anyone doing Android — or pledges only to use them for defense — or some other clever “look, we’re really just interested in the patents for protection” move. All that, along with spinning Motorola back out as a truly separate company.

Will Google Treat All Its Baby Bears The Same?

Google is already trying to reassure that all Android makers will get treated the same. From its blog post:

This acquisition will not change our commitment to run Android as an open platform. Motorola will remain a licensee of Android and Android will remain open. We will run Motorola as a separate business. Many hardware partners have contributed to Android’s success and we look forward to continuing to work with all of them to deliver outstanding user experiences.

Maybe this really will happen, that Motorola will be so independent of Google that Motorola will complain that Samsung or HTC seem to have gained some special favor.

I wouldn’t count on it. It just seems a difficult juggling act to pull off. Plus, this quote from mocoNews really stuck in my head:

A source familiar with Google’s strategy during the Nortel patent auctions told me weeks ago that Google couldn’t quite bring itself to see a patent portfolio as valuable as an actual company with skilled people.

Arguments that it’s just about the patents and Motorola will be off in its own Motorola corner seem short-sighted. That’s especially so when you go back to Google’s own blog post:

Motorola’s total commitment to Android in mobile devices is one of many reasons that there is a natural fit between our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere.

How do you create amazing user experiences with a company that supposedly is a separate business? Why can’t you do that with it being just a separate business?

Google: The Nexus Program Plays Fair!

As proof that no one will get favored, during the conference call today, Google talked about something I’d never heard about before — that the Nexus One and the Nexus S were all part of a Nexus “lead device” strategy that sort of rotates to different handset makers.

Android And Me quotes Google’s mobile chief Andy Rubin from the call (audio here from The Verge):

We have this strategy where we have this Nexus program, and we have this lead device strategy. That strategy has worked quite well to help focus the team. What we do is that we select each — around Christmastime of each year — we select a manufacturer that we work very closely with to release a device in that time frame.

I was at the Nexus One press conference in January 2010, where that HTC device — Google’s first “Google phone” handset — was launched. There was no talk about a strategy like this then, that I recall. If anything, when Google abandoned Nexus One direct sales a few months later, it seemed like there would never be a Nexus Two.

Of course, by December 2010, we got the Nexus S — and in the announcement, there is talk of it being the “lead device” for Android 2.3. But there was no particular mention of Samsung having competed for this honor, or that it was somehow Samsung’s “turn” to get it.

Google: Your Next Consumer Electronics Company?

Perhaps the most compelling for Google integrating more tightly with Motorola are suggestions that Google is looking at the huge profits (even bigger than Google’s) that Apple is generating and thinking it might be even more successful if it did its own hardware.

Computerworld reports Ticonderoga Securities analytic Brian White saying:

“This will let Google control the total user experience, just as Apple does,” said White.

I saw another analyst echoing similar comments. Sorry, I can’t recall or find which one, but they talked about Apple passing Exxon to become the most valuable public company and whether Google, looking at Apple’s tight integration, might feel it needs to do the same.

Certainly Google has both a mobile operating system (Android to Apple iOS) and desktop operating system (Chrome OS to MacOS) to match Apple. But unlike Apple, Google doesn’t do hardware. Motorola corrects that.

Motorola would give Google its own directly controlled devices, if it wants them, in the smartphone and tablet spaces. Motorola doesn’t do laptops, though potentially it could expand here. There’s also the cablebox / DVR space that some are saying might be a boost for Google TV.

I kind of doubt that. Google TV already has tight, useful integration with Dish TV, but that hasn’t helped. Currently, Google TV is a dog of a product for several reasons. Maybe in time, it’ll get there.

Overall, Google’s been kind of schizophrenic on the hardware-software integration aspect. Apple’s bad because it controls its devices so closely, both hardware and software. Google’s good, because it allows anyone to add “value” to its devices.

But Apple’s “closed” system makes for generally beautiful devices (unless you want Amazon or Hulu on your Apple TV). And Google’s “open” system leads to fragmentation where you never quite know what a device is going to do, even if it’s running Android.

Google’s acknowledged the fragmentation issue but largely written that off as a problem, unless — this is the schizophrenic part — it’s over some “compatibility” issue as with Skyhook.

Potentially, the Motorola deal lets Google move ahead on a path it might begin to believe is best: that to fully fight against a “closed” world that it believes Apple propagates, Google needs to have, ironically, a closed device loop of its own.

Perhaps that’s not the main thinking now. Perhaps it’s not even a thought now. But Google’s considered hardware before, and it will no doubt think about it again. When it does, this time, it’ll own a hardware company.

What About Anti-Trust Issues?

Of course, none of this will happen unless the deal is approved by various regulators, including in the US and the EU. Google’s already under investigation over anti-trust issues in both countries. Surely, this will just make matters worse and not be allowed.

Maybe. Maybe not. Who knows? I don’t. I’m not an anti-trust expert. But to say on the surface that Google can’t have a mobile operating system and also be a handset maker doesn’t make sense. Apple does this. Heck, you can’t favor yourself over other handset makers more than Apple does. It doesn’t allow any others to use its OS.

There’s going to be a huge difference between whether Google lives up to really providing an “open” OS in terms of what it promises and whether that’s anything to do with running into anti-trust issues.

Maybe, as Foss Patents touches on, there will be issues on whether Google uses money from one of its businesses to somehow unfairly prop up its “free” hardware business.

Maybe. But as I covered in my The Growing Portrait Of Google As A Big, Scary, Expanding Everywhere Copy Monster piece last week, you could make these arguments about Microsoft and Apple, as well.

For me, the bigger issue is likely whether Google ends up closing the loop too much. Will Google’s moves be seen as linking everything it does — search, ads, mobile, hardware and so on — in a way to prevent competition?

Potentially, especially at a time when Google is viewed by some as being too big. But then again, it also faces the very big company of Apple and the still sizable company of Microsoft. It’s hard to argue that all these players aren’t competing with each other, and fiercely.

Frankly, I’m less worried that they need protection from each other and more worried that we as consumers need more protection from them. Or perhaps more rights to protect our choices on devices that are, after all, ours.

For related news across the web on this topic, see Techmeme. For related stories from Search Engine Land, see below.

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Related Topics: Channel: Mobile | Features: Analysis | Google: Acquisitions | Google: Mobile | Top News


About The Author: is a Founding Editor of Search Engine Land. He’s a widely cited authority on search engines and search marketing issues who has covered the space since 1996. Danny also serves as Chief Content Officer for Third Door Media, which publishes Search Engine Land and produces the SMX: Search Marketing Expo conference series. He has a personal blog called Daggle (and keeps his disclosures page there). He can be found on Facebook, Google + and microblogs on Twitter as @dannysullivan.

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