Google's Motorola Deal: Phones or Patents?

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As Andrew Ross Sorkin reminds us, Google has been denying suggestions that it wants to get into the mobile phone business for years now.  So we might want to be a bit skeptical when Google tells us that its $12.5 billion deal to buy Motorola Mobility is all about acquiring patents.  On his DealBook column for the New York Times, Sorkin writes

...it is undeniable that Google’s new chief executive, Larry Page, has long had a hankering for the mobile phone business, and this acquisition may be the culmination of his ambitions. Mr. Page, after all, was the executive who personally pursued the acquisition of Android and has been its biggest proponent. And he pressed Google to compete in federal auctions for wireless spectrum in recent years at a time when others were more hesitant — and in some cases was willing to overpay for spectrum.

“He was the guy behind Android,” Mr. Levy said in an interview. “Larry is a big ambitious guy; he will roll big dice.”

If there’s any question about Google’s motivation to own a handset maker rather than just a portfolio of patents, consider this: InterDigital, a licensing company that owns some 8,000 wireless patents and has another 10,000 patent applications being processed, has been up for auction. Many industry insiders were sure that if Google were serious about acquiring a portfolio of patents, InterDigital would be its target. The company’s market value is only about $3 billion and it doesn’t come with all the baggage of Motorola’s handset business.

Read Is Google Turning Into a Mobile Phone Company? No, It Says here.


Posted 08-16-2011 10:08 AM by Graham Griffith
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