Handset makers such as HTC and Samsung aren’t going to like this. Google CEO/co-founder Larry Page announced this morning that Google has agreed to acquire Motorola Mobility for $12.5 billion, which is about $40 per share. This puts Google on the same level as Apple when it comes to designing both hardware and software.
This $12.5 billion is also a large chunk of Google’s $39 billion in cash, and since $12.5 billion is just shy of $13 billion, it is about 1/3 of Google’s cash.
Another reason Google would want to buy Motorola is because Motorola has a large portfolio of patents. Google says that it will “enable us to better protect Android from anti-competitive threats from Microsoft, Apple, and other companies.” This is an obvious referral to Google’s lawyer tantrums accusing Apple, Microsoft, Oracle, and others of patent bullying. Google had called the Novell patents that Apple, Microsoft, and others bought “bogus” and “anti-competitive”. (Google didn’t actually even bid for those Novell patents themselves, even though Microsoft’s lawyers said that they had invited Google to join their side to help bid for Novell patents.)
Motorola Mobility is the company that makes the Droid phones and the Xoom tablets, which both compete with Apple.
So what do you think? With Google making their own phones, will other handset makers move to some other OS’s, like maybe Windows Phone 7? Feel free to discuss in the comments!
UPDATE: This deal isn’t all cash. Part stock, part cash. Be sure to subtract the $3 billion in cash that Motorola Mobility has on their balance sheet.