Has Google Shot Android In The Foot

Motorola Acquisition May Give Other Handset Makers Pause

Big news today (as in 12.5B big) is that Google has bought Motorola Mobility Holdings, the company behind the popular Droid phones for 12.5 Billion dollars in cash. A good and quick result so soon after Motorola split itself in two just a short time ago. The deal was apparently attractive to Google on two fronts. First of all it gives Google its own handset maker so it can better do battle with Apple's iPhone, RIM's Blackberry and Nokia's Microsoft phones. Secondly as Google finds itself increasingly involved in patent claims, it gives Google some patent portfolio strength of their own.

What it also does though is give pause to the 20 to 30 other handset manufacturers around the world who make Android based phones to wonder will they be on an even playing ground. One of Android's key strengths is that its wide base of manufacturers allows it to be sold on just about every network, in many form factors and price points. This Android everywhere model is I think the key reason it has seen such phenomenal success. Now makers like Samsung and HTC may ask themselves, how do we compete with Droid?

Of course Google has tried to sell its own handset before. The Nexus phone by Google did not exactly set the market on fire. The phone was actually made by HTC and did not deter Samsung, Motorola or the others from continuing full speed ahead on Android phones. However, picking up the Droid brand is another story. Even with the best of intentions, on its face the conflict is inherent here.

I could even foresee a future where Google goes out of its way to show that they are not playing favorites and actually "penalizes" Motorola by delaying availability of code. But even with that I don't think you stop the whispers that of course they have a "special relationship". I would assume that Google has every intention of making their 12.5 billion dollar investment pay off. Maybe in an alternate reality they have run a scenario where Droid does become the dominant Android phone and they go head to head with Apple and the rest.

It is a fine line they are walking. Realizing that having an in house brand gives them the chance to go head-to-head that they need versus killing the goose that has laid golden eggs with the diversity of the Android market.

Time will tell how Google handles this delicate balancing act and how the other handset makers react to this deal. In the meantime I think the patents that Google gets in this deal with be used defensively. I don't see Google going out and suing for patent enforcement just yet.

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