Driving Miss Sadie
Last week I announced that I’m planning my own Android phone and the next thing you know Google does the same thing! Coincidence? I think not. Our motivations are somewhat different, however, and their budget, at $12.5 billion, is marginally higher. I’ve had plenty of time to think about this as I drive the dogs across country to our next home in California and there’s quite a bit more to this Motorola deal than other pundits have been saying.
Yes, it has a lot to do with patents and that might well explain Google’s goofy bidding behavior during the recent Nortel patent auction. Maybe Google already knew it was going for Moto at that point. Certainly with these 17,000 patents plus the $1 billion worth of patents acquired from IBM, Google can go toe-to-toe with Apple or anyone else in an IP battle. Cross-licenses of certain mobile technologies would certainly appear to be in the future for many of these companies.
And cross-licenses represent another important aspect of MotoGoogle that generally hasn’t been noticed — Motorola’s Java license. Oracle, the new owner of Java and all the rest of Sun Microsystem’s old IP, has been beating-up on Google in court, claiming the search giant has stolen Java technology. Not anymore. If this Motorola Mobility deal goes through (and I think it will) then Oracle loses grounds for its lawsuit, which is part of why Google is even doing the deal.
Okay, so Google is going into the phone business. Of course they are going to run the company as a separate business since that’s about the only way to spin the inevitable negative impact the deal will have on Google’s gross margins. Only Apple makes big margins on hardware and while MotoGoogle would like to be Apple, it isn’t.
What does this mean for Google Voice? I haven’t heard this question asked yet. If Google wants to sell phones they’ll mainly do so through the mobile carriers and every one of those carriers is threatened by Google Voice’s potential to disintermediate them and steal their revenue. I’m sure the carriers will ask for Google Voice to go away as a condition for handling MotoGoogle phones. It wouldn’t surprise me, either, if this turn of events for Google Voice surprises Google, which is a very smart company with occasional blind spots.
I think the deal is going to shake up the mobile voice and data businesses generally. And this might not be the end of it, either. What if, for example, Google mounted a bid for T-Mobile? Why not? Yes, it would be expensive but such a move would level the playing field in even more ways, giving Google a 4G network they could really use, shaking-up the incumbent carriers in the process.
What if, what if, what if… Google TV is so far a failure, but this deal could shake that up, too, with MotoGoogle perhaps entering the set-top box business. Certainly Motorola has technology to contribute and what will be interesting to see is how the business shakes out as a result.
This is a bold move on Google’s part. Not a bet the company move, but the move of a confident Larry Page who knows that bold action is required. He has guts, that boy. And I think it is going to be fun to see how this plays out.
[…] looking for a short and to the point post of what this could mean, I point you no further than to this piece written by Robert Cringely. This entry was posted in Internet, Telecommunications. Bookmark the […]
I think part of the question is whether Google actually thinks there is a smartphone market. Maybe they think they are dealing with pocket computers with internet access where voice communications is part of the accessory package. I spend about as much time talking on Google Voice and Skype as my actual phone.
Overall the Pocket Computer Phones (PCP) are just another way to push ads to you. Their Robocar initiative means they can push ads to you while you are commuting.
I’m still waiting for Google Sleep to hit the market so they have 7/24 access.
Wouldn’t be surprised if carriers insist on Google Voice ban from Android Market (just like the tethering app bans) but does that violate the “any app, any device” clause from the FCC’s 4G/700MHz auction? As for cable providers, they might insist on set-top boxes that ban apps like Hulu and Bittorrent+RSS from Android Market. I hope the FCC looks into that one too. Dumb pipes forever!!
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Guts indeed.
I almost wish they’d buy T Mobile just so they’d no longer have an excuse to not support MMS in Google Voice.
All that said though, I’ve come to realize I’m a Google fanboy. Not to say they can never do wrong, but I think normally something like this would make me sigh and roll my eyes. This? This piques my curiosity.
Personally, I prefer Googrola. Sounds like a soft-drink brand.
I thought Googrola was one of those smelly cheeses with bluish-green mold growing in it…
It’s brand envy, purely. They’re should have gone with GooMoTo to go head to head with DoCoMo.
Will the new phone be a Cringoid?
I vote for Motoogle.
Googrola sounds like something I can catch, a disease 😉
They are acting more like Googlrilla!
I think we can come up with something better than “MotoGoogle”. How about Googola, Motogo, Googlemot, Droidle, or Rolagoo.
I think the entire deal is about patents. However, Google will probably do something interesting with Motorola. A bit for T-Mobile would be smart, but can Google afford T-Mob?
I think there are a number of little extras coming out of this deal that will pay dividends in the future. I agree that most of the analysis is to focused on the patents and not looking at the big picture. This deal makes sense for Google for more reasons than just patent protection.
The Set top Box and Cable/DSL modem markets are ripe for google service integration. Google TV integration into both of these units is a great example. But consider how well integrating a search proxy into the modems to speed search results. Or built in google video/youtube network code to help reduce the bandwidth cost. There are a number of avenues to explore just in these business groups alone.
Google can use Moto’s phone business to create pressure on the other phone makers for upgrading their OS versions. I think it’s interesting that this deal is getting done just as the Android platform has been unified between all phones and tablets in a single release. A policy that sees Moto Phones updated to the newest released version of the software could force the other handset providers to do updates for their phones in a timely manner.
I don’t expect Google to push itself into heavy competition with its partners in the mobile space. My personal expectation is for a very limited number of models released each cycle. Perhaps an entry level, mid level, and high end phone model for the consumer market and one phone model pointed at the business market. A lot of the speculation is that partners will look to reduce their android commitment or defect all together but I don’t think that necessarily follows. ATI (now AMD’s Graphics division) has a long standing partner program where It makes the main reference cards for each line but relies on its partners to create more compelling products with software bundles, price conscious designs, or special features not available from the main line. A similar relationship could be developed in the phone space. And at the end of the day there just aren’t that many platforms out there for partners to consider. Andriod and IOS have the lion share of the market. RIM and HP don’t license their software and neither HP nor Microsoft have significant market share. Edge stuff like meego doesn’t even register on the radar.
I think the purchase is going to have long standing repercussions. It will be interesting to see it play out.
I hope your journey west was a good and safe one.
As always you raise many new and interesting points.
In the news yesterday the pundits were totally focused on the cell phone business. They didn’t seem to understand the concept of owning patents as a tool to negotiate out of court settlements to patent infringement claims of others.
I did not know this division of Motorola makes other phone products, Cable TV gear, and GPS navigation gear. There is a lot more synergy than originally thought. This could be an excellent investment by Google.
I don’t know where my Cable TV provider gets its phone and digital TV technology, but its pretty clunky. (Actually I do know.) It is not a complete and seamless service. The parts are patched together and don’t work right. Google could really help here. They could help my Cable TV provider provide much better technology and services, more profitably. This could be a good thing for the consumer.
There is a legitimate concern about Google now being a hardware competitor to its Android partners — firms like HTC and Samsung. There are many ways to address this issue. For one they could sell or spin off the division. Actually I hope they don’t. There is a lot to be gained by making products and following them into the consumer market. I am sure there is something Google can do to keep its partners happy.
I think the other advantages are icing on the cake, open potential. I think the short term was *strictly* the IP patent portfolio (and mentioned Java license) as Android was getting pretty beaten up in the public press over all the lawsuits and everybody wondering where was the White Knight to come in and protect their rather extensive investment in this technology.
Some big makers like HTC or Samsung might have weathered it, but a cease-and-desist on Android as a whole (which without the counter-patents to settle with, was likely inevitable as “obviousness” is not something any court ever grants in a patent lawsuit no matter what us geeks say) would have been devastating to the entire tablet market just as it is getting started, and a lot of these smaller companies with really good ideas (even if their first versions aren’t the best implementations, like the combination e-reader/android by enTourage) would just disappear and Apple could go back to not having to innovate and compete for a while.
The essential elements of a smartphone purchase are: go into a brick-and-mortar store, pick out a phone, pick out a service plan for the phone, sign a contract. The carrier receives a couple of grand or so, you receive a piece of equipment that you can use to make calls pretty much anywhere. How would terminating a call on Google Voice over a different IP network negatively affect their fortunes? How much money do carriers actually bring in on overage minutes? A carrier should be so lucky as to not have to build out their towers as heavily.
Also consider that Googorola makes head-end and cell-station equipment. What might a “Google Experience” for carriers look like? It’s almost like winning the spectrum auction through the back door, if cards are played right.
From a strategic standpoint, Google’s acquisition of the Motorola Personal Communications Sector, MMI, is a great idea. Motorola has been dead from the neck up for ten years or so, thus an active leadership running one of the sectors is always good to see.
But more importantly, while the Nortel patents were a nice bunch, they were not the fundamental patents that the Motorola Mobility patents were. The Mobility patents were the baseline upon which huge stretches of the mobile phone and communications technology architecture built upon. This means that almost every player, including Nortel’s inheritors, is in a an IP deficit position compared to the Mobility patents.
And furthermore, the MMI purchase includes the legacy General Instruments business, aka set-top boxes, and the underlying technology and engineering know-how that accompanies it.
So on the technical ladder, this is an outstanding opportunity for Google to increases its reach and depth.
However, on the management ladder, this could be very ugly. Motorola’s Personal Communication Sector was always one of the most intransigent and uncooperative of the Warring Tribes, constantly taking action to the detriment of the Motorola base station, semiconductor, battery, and radio sectors. PCS was also full of political bad apples who were able to get away with these detrimental actions because of their skill in the ways of the weasel.
Furthermore, MMI has something like 400+ vice presidents who are veterans of the Warring Tribes, and who have been in the business of acquiring other companies for twenty years, and they will not assume a posture that Google execs are going to enjoy.
The acquisition integration of the MMI organization into Google could be an ulcer that Google has swallowed on purpose unless Google handles it skillfully. A simplistic answer to the problem would be to fire everyone who has a VP or maybe Director title and above, as it is really the engineering and process technology people that Google wants. But that won’t happen.
Good luck to Googorola, as the combination could be very powerful.
Motorola VP’s excel at the politics of becoming a VP.
I’ve also heard that one of the driving factors in the decision is the software engineering talent at Moto Mobility’s HQ in Libertyville, IL. The thought being that Goog engineers understand large-scale databases & web apps, but their California developers cannot match the Moto engineers when it comes to phones, tablets, set top boxes and the like.
There was a rumour about moving the Moto handset group to San Diego, but now there is no way that is going to happen.
Dude, I don’t think Java licensing works the way you think it does. AFAIK, that license is only for versions of embedded Java that were “compliant” with Sun’s certification – basically, JavaME. Android was never “compliant,” so the license can’t simply be applied to it. Pretty much every cellphone manufacturer has a license to JavaME, but that didn’t stop Oracle from (supposedly) seeking royalties from them for Android.
Also, those patents make for a nice, big number, but probably won’t help Google much. Motorola’s been in the game long enough that almost anybody who’s making cellphones would have a license (or cross-license) in place already. Except maybe Apple, but Apple’s got a lawsuit with Motorola anyway. (As does Microsoft.)
I think Google was backed into a corner when Jha and Icahn started making noise about using their IP to “differentiate” from other Android makers and being “open to Windows Phone.” After losing the Nortel auction, and with MSFT sniffing around those patents, they had almost no choice.
But I also think this is not necessarily a bad deal for Google… not unless they fail to make the best of it. It’s going to be very difficult, but if properly executed, Googorola could end up delivering well-integrated phones like Apple, as well as compelling Google TV devices.
Excellent points, I was wondering when someone would bring up the “potency” of Motorola’s patent portfolio. But I would go a little further and assume that Apple DOES already have licensing in place for Motorola’s most applicable patents. Apple and Motorola go way back, plus I can guarantee you that Steve Jobs himself made sure all of those factors were tidy before the first iPhone shipped. There’s no way he was gonna build such a big house of cards.
As for the Java licensing details, I’m glad you bring up the particulars. I didn’t think buying Motorola Mobility would be a silver bullet there. Not only that, but even if they *were* applicable licensing terms, I’m not sure how the privilege would commute to Google proper, if their plan is to run MMI as an independent business. Seems like, if they do that, then Google still would need its own licensing agreement with Oracle in order to be square with them. But I guess it depends on how liberal the terms are in Motorola’s licensing agreement.
I’m a little confused. Maybe I’m being stupid. I’m not a lawyer – I don’t even play one on TV. But how does acquiring Motorola’s Java-related patents or licenses help them in their current legal tussle with Oracle? Even supposing (and there seems to be some doubt) that Motorola’s patent pool includes the necessary Java stuff, how does this excuse Google from past (in fact, current) infringement? In fact, wouldn’t it appear to be a tacit admission on Google’s part that they have been infringing? “Hey, look! We got some new patents – we’re in the clear. That stuff we were stealing before, we’re covered|”
Of course, I’m way too innocent for this world. It probably doesn’t matter.
[1998]
Motorola licenses a complete line of Java technologies By Niall McKay sun microsystems’ deal to license Java to Motorola marked the company’s first step …
http://books.google.com/books?id=61EEAAAAMBAJ&pg=PA70-IA4&lpg=PA70-IA4&dq=motorola+java+license&source=bl&ots=asGjBm4qRM&sig=QTnXSpG_K3KkmwcDZg4HbttSN_g&hl=en&ei=DfFKTvHnK8O1sQKFodHXCA&sa=X&oi=book_result&ct=result&resnum=5&ved=0CDEQ6AEwBDgK#v=onepage&q=motorola%20java%20license&f=false
You’ll notice it does not mention “Android” anywhere in that article 😉 Of course, Android didn’t exist then, but you get my point…
Sun was pretty careful in wording its licenses when “opening” up Java because they wanted to maintain some degree of control over the Java ecosystem. Java on mobile devices was a specific exception in the license. According to the terms of that license, Android is not covered by its open source license, which still leaves it open to infringement lawsuits.
This is a great point. Do you know if Motorola Mobility has also cross-licensed relevant patents from Apple, et al., and does this counter the Android lawsuits?
I figure that this is likely, but I don’t know anything.
I am thinking of course of possible or actual lawsuits against Google for Android, not the current ones that were in process against Moto prior to the purchase.
Unfortunately, I have no information about specific licensing or cross-licensing deals. But given how the industry, and Motorola, operates, it is almost a given that they already have deals in place with most of the other players.
Further, a lot of Motorola patents cover technologies used in wireless standards. These patents are encumbered with FRAND licensing terms, i.e. they *must* be licensed on Friendly, Reasonable and Non-Discriminatory terms (otherwise the standard will have a huge problem with adoption). These restrictions greatly weaken them as bargaining chips. (Microsoft and Apple have already brought this up against Motorola’s respective countersuits against them.)
Of course, I’m sure Motorola has kept some prized patents for itself exactly for the purposes of counter-suit. These, however, may not be the majority of them.
Also, since the Google/Oracle lawsuit is about Java and VMs, it seems unlikely that Motorola, a cellphone maker, would have any patents that could influence that lawsuit.
The Moto part already is in the set-top business.
I really hope Google Voice doesn’t become yet another service in the Google Junkyard. Sure, it could be a lot better, but it also has some serious potential (to some extent, those are two ways of saying the same thing). It’s on its way to having tighter integration with the GMail/GTalk blob. The sooner voice is just another interchangeable part riding on the back of the network, the happier I’ll be.
Maybe that will be more likely if Google does indeed buy T-Mobile. And perhaps they will, if the purchase by AT&T falls-through. It would also mean I wouldn’t have to change carriers.
Google bought Motorola Mobility, that’s the mobile company. Phones and Tablets…right? What does Motorola Mobilty have to do with set-top boxes?
The set-top devices are under Motorola Mobility. May not necessarily seem “mobile”, but nonetheless, it is part of what Google bought.
https://www.motorola.com/Consumers/US-EN/Consumer-Product-and-Services/Home-Digital-Video
I agree with the Bob that is deal is not about the hardware.
Apple is not a hardware manufacturer they are a brand. Manufacturing is
farmed out to Foxconn.
The GOOG will do the same or sell it off outright.
The tethering tariff on Android phones is downright silly. Why do I have to “root” my phone to enable built in features? Hopefully this nonsense is going away.
This deal also confirms Roger McNamee’s hypotheses are playing out right now,
http://fora.tv/2011/06/28/Elevation_Partners_Director_and_Co-Founder_Roger_McNamee
https://www.chimehosting.com/moonalice/TechInvestingHypotheses.pdf
Are you saying there are no engineers in Cupertino? Apple may farm out the manufacturing but the design work (inc. the chip designs thanks to the acquisitions of various ARM design companies) is done in-house. Clearly, assembly is done in Taiwan and China but Apple is very much a hardware and software (and retail) company. Who wants the dead weight of manufacturing when you can pick the lowest competitive bid?
Good Forbes piece “Why Amazon Can’t Make A Kindle In the USA”,
https://www.forbes.com/sites/stevedenning/2011/08/17/why-amazon-cant-make-a-kindle-in-the-usa/
The packaging of the A4 and A5 Apple ARM processors is unique. Funny that DEC technology is driving the brave new world.
Buying T-Mobile would be a disaster for Google. Every other carrier in US and rest of the world would stop selling their products because they’d only be helping a company who might someday come and try and take them over.
It’s the same reason Apple won’t do it, no hardware manufacturer can survive without many, many carriers supporting them.
It doesn’t make sense, Why pay $12B and fold in the Nortel patent auction at 3.14159 B ?
Motorola phone patents are the key,
https://www.google.com/patents?vid=3906166
Which was filed in 1973 and expired in 1990. I am certain Motorola has
a few other cellular phone patents 😉
A bit of irony, Google Patents “beta”,
https://www.google.com/patents
with over 7 million patents served 😉
Yes but they are paying $12 Billion for them . . . yet they folded in the Nortel patent auction at $3.14159 Billion. Why didn’t they go higher? Couldn’t think of the suitable nerdy number in the $6B range?
Because it’s not just the patents. Otherwise they would have bought InterDigital for 3B, and saved themselves the headache of having 19,000 new employees on payroll, anti-trust investigators, and a money-losing hardware business.
Google is up to something, something else. Either they DO want to get into the integrated hardware business, or they really want to get into people’s TVs.
[…] FOLLOW – Cringely has some interesting views on the deal — yes it is about patents, but there may be more synergies in this as […]
I love the fact that you’re one of the people who believed this is not just a panic defensive move by google against those lawsuits, but a strategic one. I think so too but i care more about the question of how will this purchase affects android as a whole. Having Google at the top of this will obviously fix a little of android’s fragmentation problem as there will be no more of motoblur and more standardized android phones approved by Google. But imagine what this will do to other Google partners like HTC & Samsung since Google has a knack for monopolizing everything.
For some reason i think that after this move Microsoft will have a better chance to convince HTC & Samsung to better support WinPhone even without the same deal that they give to Nokia.
Bob, can you explain your thought process for this “If this Motorola Mobility deal goes through (and I think it will) then Oracle loses grounds for its lawsuit, which is part of why Google is even doing the deal.”
I just don’t see how this affects Oracle or their lawsuit against Google.
@JR: Oracle claims Google’s Android has incorporated without license substantial patented assets of Oracle’s, including the Java code libraries.
Google buys Motorola, which has a paid Java license.
now the continuing violation is over, judgement moot. there is still a court case to be heard imho over past violation, which now becomes a smaller issue, as that’s just money. the stop to Android, and possibly Google services provided via Java on the browser, can no longer happen. the company is safe, mere money is at state. if you have the capitalization in the market as Google does, mere money is any sum below the total of all nation’s sovereign assets 😉
Ahh, ok, that makes sense. Didn’t realize Moto had paid up license for Oracle/Java patents. Guess it might still depend on if they have the right license for the right patents.
makes the new company leaders MoGols? watch out, movie studios.
Many people–but the tech blogs and their legions of fanboys especially–seem to have missed the bigger picture. Sure, it’s about patents, but I am convinced that it all comes down to that little magnifying glass in the top corner of the Android home screen. This is about protecting Google’s dominance of search and its ad revenues, and always has been. Microsoft began coveting that revenue stream long before Google ever dreamed of a phone. Once the iPhone came along, we saw how easy it would be for somebody to choke it off–iAds is proof enough that Apple would like to. It would be worth any amount of money to Google to keep the likes of Apple and Microsoft from cutting off its lifeblood at a whim.
With this acquisition, Google will become the largest technology supplier (STB’s etc) to US cable, providing invaluable insight and footprint to “disrupt” that industry over the longer-term. You don’t think Google was just going to walk away after the take-up of Google TV was less than stellar.
remember the fiasco over the “cable ready” TV sets that had ident card slots? curiously, the cards didn’t always work with the cableco’s authenticate-then-program systems.
next gen > IS < going to work with the servers in the Googleplex. except next gen is going to be tethering and portables provide the authentication, no matter what screen the content ends up on.
just sayin'
oh, has anybody mentioned yet that everybody in mobile telephony has cross-licensing deals with Motorola because of the ubuquitous nature of their patents? without Moto patents, nobody else can operate.
cross-licensing, generally book-wide..
total and utter end of lawsuits against Android makers once the deal goes through. again, only thing left to decide is back pay in the courts for past transgressions. that’s only money.
Exactly, this is just business not personal 😉
I am sure Google will make more money with Google’s new deal with Motorola.
You seem very sure that Google is Apple when it comes to business, able to make money from everything they touch.
Why should they not turn out to be Microsoft — investing in dozens of businesses, some large, many small, ALL of which lose money except the two cash cows. (XBox, as I understand it, now makes money; but has still not made enough to cover its previous expenses, and it’s not certain that it ever will.)
The best thing about Google is that speculating about their plans always goes bigger than speculation about other companies. Google isn’t afraid to try game-changers, even when they fail most of the time.
Two crazy speculations:
1) Google withdraws Motorola entirely from the carrier-based phone market (where it was losing share anyway) and rebrands Motorola as a VOIP-only Android smartphone featuring a beefed up Google Voice and tethering apps. These phones not only work without a subscription plan, they can be used anywhere in the world without roaming charges or sim card issues. Other makers continue to get the Android support they want, but have to fight it out over a smaller pie as millions of people rejoice at the chance to ditch carriers once and for all. Eventually every Android carrier submits to Google in exchange for the Voice software, as the carriers die a slow, painful, and deserved death. Apple quickly creates its own VOIP versions of the iPhone and succeeds. Microsoft/Nokia tries the same and fails.
2) Google withdraws Motorola from the cable-TV box top industry and rebrands MotoGoogle as a Google TV box that bypasses the cable companies, which are loathed more than the phone carriers. For $20 a month you get streaming TV over the internet, using net-neutral broadband, $15 of which goes to the NBCs, Disneys, and Time-Warners of the world who are only to happy for a new revenue paradigm that ditches the Comcasts of the world. Comcast fights back by refusing to carry the Google TV signal on its broadband, only to realize that its cable TV monopoly doesn’t apply to its ISP business. Consumers abandon Comcast while opening champagne bottles. Apple gives up on Apple TV but buys NBC and/or Time Warner, and negotiates lucrative content deals with their new best frenemy MotoGoogle.
See? This is fun. Google is fun because anything is possible.
That WAS fun! Great post.
I’m not sure if this is the same thing. But, I have an Ipod Touch 4g. I down load an ap called google voice, then I down load another ap called talkatone.
Talkatone allows me to use my ipod touch as a phone for FREE anywhere there’s a wifi connection. My cell phone is only for in bound calls, and urgent out bounds that can’t wait for me to get to a McDonalds/starbucks/barnes&noble/panera bread co.
btw, talkatone doesn’t work without google voice. It’s a piggy back. But essentially, I have free untethered phone service anywhere there’s a wifi.
I think this trail is worth sniffing. The pieces may be worth more than the sum of the apparent top-line synergy, and some of the pieces may be worth more when they’re taken off the table – like pulling out of the little/no margin handset business. The set-top box angle and the patents may be what’s really valued by Google. They may not be able to control the broadband infrastructure in the US, but if they control roughly half of the controllers of the cable boxes, that’s something. And that gives them leverage with the ISPs and the content providers at some point.
Crazy is the right word for those spculations. Wi-Fi is not a substitute for Internet access, merely a 100-foot “extension cord” with a “padlock”. But you do have a point that if voip and tvoip actually worked reliably some people would try to save money by eliminating the carriers’ premium offerings which do not use the Internet.
Hey, no one seems to be discussing the angle that Apple and Microsoft, with others, are ganging up on Google. Apple + Microsoft . . .who would have thought? I guess this proves the old addage, “The enemy of my enemy is my friend” 🙂
That’s not new — remember how MS invested money in a struggling Apple in 1997, largely because they needed another OS to exist to fight off anti-trust legislation in Europe?
Had Microsoft held onto the 18+ million shares they had in Apple until today, their $150m investment would have been worth around $4.57 billion. But they sold it at some point.
Anyway Apple and MS are no longer enemies. Apple doesn’t need more than 8% share of browsers to be worth more than MS, which in turn prefers to go after Google with Bing (and patents related to Android) than try to make another Zune-like iPad chaser.
Also, Apple and Google are only enemies as far as Google fears an iPlanet where Apple can boot Google Search off phones. Android doesn’t need to kill iOs anymore than G+ needs to kill Facebook. Google just needs to keep a horse alive in both races so the “walled gardens” of Apple and FB are never truly complete.
True enemies are like Coke and Pepsi, who are the same company wanting the same control of the same industry with the same products and services. Google, Apple, MS, and FB are all after different things that occasionally overlap.
Sorry I meant “8% share of OS”, not browsers.
Good observations !
Here’s a question…
What if Google simply decides to shutdown Motorola? They have what they want: The IP patents and the possible Java license. All the hardware portion does is make their licensees nervous.
If you were HTC or Samsung, would you trust Google now that it makes phones that compete against yours? Especially since Google is keeping a tighter grip on the OS. You know how Google picks one lucky winner to get the next version of the OS six months before their competitors? That beauty contest is a bit more fixed now that the Judge’s niece is one of the contestants.
Even if Google fires every one of the 20,000 employees and just shutters all of the plants, there would be no drop in the number of Android phones. The other vendors will quickly pick up the slack. And, Google could sell the remains of Motorola to someone else for a couple of billion.
It might just be better for Google to shed the Motorola hardware now it has its patents.
Google can’t legally or cheaply just fire 20,000 people. And as sad as they have seemed in recent years, Motorola has lots of great assets. Infrastructure, equipment, IP, and some very talented people.
Google could strip down the company to be more profitable and lean, and then sell it for 8 billion (Motorola’s market cap before the merger). Though minus the patents it might be worth less.
See “IBM, Lenovo, Chinese” for reference.
As a friend of mine pointed out, Novel’s 882 patents went for $450M. Nortels 6,000 patents went for $4.5B. Now Moto’s 17,000 (with another 7,500 pending) for $12.5B.
Google bought a patent arsenal, and got a hardware company for free like so much a toy in a Happy Meal. Bet your ass they’re going to play with it. Consider the team they have working with them, the now reformed Danger, Inc. co-founders, who’ve been focusing on Android hardware for a while now with no concrete plans to release hardware.
I think Google has been preparing for this for longer than we realize.
nikeheels-shop.com
Mogle
Gotorola
Googorola.
It is delightfully cheesy.
Looking at this weeks picture — Is that a microphone for a CB radio on the dash of your RV? Does the CB radio still work? Do you use it? Is there an 8-track player too?
Since you are the supreme columnist of technology, these are important questions for your readers.
I don’t share the optimistic “what ifs?” some seem to have regarding MM’s cable box business.
Google might be able to build a better box, but it’s not as if they can magically snap their fingers and have the MSOs and content industry fall in line with their wishes.
The content cartels still view Google with suspicion, and the MSOs aren’t going to welcome a potential drain on their core business with open arms; they can always transition to Cisco’s boxes.
An interesting thought… Why does GOOGLE have to be in competition with the content cartels? Given Google’s size and infrastructure, they could become a platform and a service that enables those with the content to distribute it. Google can integrate its infrastructure with MM’s hardware and improve its integration with other platforms. There are things Google can do with its advertising technology that would be of great value to both Google and the content cartel. Why mash in any advertisement and the same advertisement into every download when Google can do a much better job at targeted advertising?
The thing is, they don’t have to be adversaries. Google could partner itself with the various content cartels and become another distribution channel, but their history doesn’t show a good record in terms of playing well with others.
Music, TV, movies, authors, publishing…is there anyone who hasn’t objected to Google’s uncompensated appropriation of content to fuel its business?
All of them want their cut of the filthy lucre Google gets from their core business, selling search advertising and demographics, but so far, Google has been reluctant to play along.
Google TV is one of the more recent examples, as is their inability to reach a deal with the music industry to set up their own store/locker business.
Apple, Amazon, and Netflix has shown that the cartels are ready to play, if you give them a piece of the action. Now, the music, publishing and gaming industries may be mad at Jobs for undermining the perceived value of their wares, but they still get 70% of the split. 70% of something small is better than the alternative, 0%.
Of course, Apple and Amazon can afford to do that since those aren’t their primary lines of business. For Google, it’s not quite the same, which may explain their reluctance to do such deals. However, if they ever change their tune, they could instantly become a big player.
But if Google stays true to their word, and runs MM with a hands-off approach, I don’t think much of anything will come to pass. They’ll have the IP to improve their patent position, and a flagship hardware vendor to lead the way for Android, but otherwise, business as usual.
And, not to mention, can you imagine the culture clash between a Moto and Google employee?
Good points Jeff. I think one of Google’s flaws is their reluctance to communicate. They are very secretive, to the point few know what they are going to do or why. They really don’t tell anyone anything. That makes it hard for others to trust them.
Lets use Apple as a counter example. You know Steve Jobs was out marketing iTunes and iPods long before the products hit the market. Their success didn’t happen over night. They kept working and working on the record companies. As Apple become more successful, more were willing to sign on. You know Steve Jobs took a very well thought out vision and product roadmap to his meetings with the music industry. Even if they weren’t sold on electronic distribution of their content, Apple’s plans had to WOW them.
I can think up some really great things Google and MM can do. There is enough technology synergy for someone to come up with a great vision and product/service roadmap. This does not seem to be Google’s culture and if they don’t learn from Apple and others they will have a hard time doing more than getting some patents to protect Android.
Google — I hope you are listening!!!
I think Android could be headed for trouble. There are a growing number of quirks and problems. We visited our cell phone providers store recently to discuss problems with our phones. We were told our problems were with the software. We were also told about a lot more problems. Then came the scary part of this story. We asked if they were telling Google about these problems. The answer was NO. They didn’t have a way to give any feedback to Google. This wasn’t just one store. It was the whole cell phone company.
Google — to be successful you must open up and start communicating with the outside world.
Have contacted Google directly regarding the problems you are having? What was their reply ?
You can directly report issues to Google via the following:
http://code.google.com/p/android/issues/list
Google has a plan that goes well beyond Motorola patents, I think. Google may be planning an end-run around Apple and the carriers both, with an end-to-end service of its own. Google owns a large amount of dark fiber (Google “Google dark fiber”). They also own a vast IPv6 address space (“Google IPv6 address space”). Something on the order of 2**96 addresses. So far they haven’t done much with that. But I bet they didn’t buy that to just sit on it. And I bet that the Motorola purchase fits in with their long term plans.
One observation about Apple and their market: It seems to me that Apple is basically under the thumb of the carriers with its iPhone and iPad. No matter how great Apple products are or will be, the carriers are limiting the value of Apple’s phones by forcing their customers into limited data plans. This will stymie Apple’s longer term plans. Of course, that all applies to Android phones that stay connected to those carriers as well.
My family uses an air card with AT&T service, which is the virtually the only way my family can get decent access to the internet in my area. AT&T limits us to 5GB/mo. (So would Verizon) That’s a very hard restriction for the family to live within, given that we had regularly used as much as 22GB/mo, yet AT&T doesn’t offer any alternative plan. We don’t dare even watch YouTube videos, let alone consider a NetFlix account.
No matter how great Apple products are or will become, they have or will have that kind of limit. But an end-to-end Google system could allow Android phones an alternative?
It seems to me that Google would have a choice here to either compete with Apple – as they have been doing – or competing with the carriers, or with both.
I remember their suggestion back during the 700MHz auction that carriers should adopt an open platform, which no one did. Maybe Google will, and let Apple phones in.
Good points. Google does have a lot of odd infrastructure that no one else does.
Could the fiber, the giant portable container data servers, the IPV6 addresses, and a proper hardware division all be combined in some way to create either a phone that bypassed carriers or a set-top box that bypassed the cable companies?
Too techie for me, but maybe someone on this board could give it a crack.
“If this Motorola Mobility deal goes through (and I think it will) then Oracle loses grounds for its lawsuit, which is part of why Google is even doing the deal.”
Huh??? That must be one hell of a license … if I had a license that broad, I’m pretty sure that **I** could make Sun profitable.
If someone from Google actually told you that was why they were doing the deal then I’d certainly like to know that so I can sell my Google stock post haste.
Bob explained that, or so I thought. Oracle is suing Google for using Java in Android. Motorola already has a license for Java in its Andriod phones. Google gets that license when the buy Motorola. As another poster has said, the lawsuit becomes only about compensation for past “transgressions”.
However kinkfisher (above) posted: “Java on mobile devices was a specific exception in the license. According to the terms of that license, Android is not covered by its open source license, which still leaves it open to infringement lawsuits.” So I’d be interested in seeing Bob’s response to that.
SUN didn’t want open source licensees, they wanted MOT and equals. So one can assume MOT got some “nice” terms, MOT got licenses for everything Java under the sun :-)[JavaOs, embedded, enterprise, runtime …]. Which has nothing to do with how SUN handled open source. And somebody at Google [James Gosling] knows a a little more than us about those contracts and their intent.
Whatever happened to the audio on this blog?
July 19th’s column was the last one with audio. Sometimes Bob does a whole month at once so I expect to see a whole bunch by late August or early September.
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Any new thoughts on this story, now that we’re hearing, less than 12 months later, that Google may sell off the Moto-Mobility unit? And why is the Ora-Google court case proceeding if Motorola’s Java license would cover Google?