Google Acquires Motorola Mobility

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gsaldivar

Diamond Member
Apr 30, 2001
8,691
1
81
Google's goal is to commoditize the hardware. They like that you can get an Android phone for $100 on a prepaid plan. In the long run, it's not the boutique OS on premium hardware that makes the most money, it's the company making ubiquitous software that runs on commodity hardware made by others. It's not in Google's interest that Android hardware is very profitable, it's in Google's interest that it's cheap.

Well said.
 

Pliablemoose

Lifer
Oct 11, 1999
25,195
0
56
LOL, I like you guys and you're pretty sharp etc, but you-all are really blinded by this stuff.

They're buying Motorola.

They won't even have to take Android private, the other manufacturers will be walking away.

Look at the companies Google has screwed over the years, (I'm not saying they're evil or anything, they're just competitive as hell and innovative, and that's a disruptive thing in business) They just spent 2 years worth of profits to buy Moto.

Android returns maybe $10/user/year in ad revenue, Apple makes $300/phone per user.

If Google focuses on mid to high end phones with Moto, kills the fragmentation issue, polishes up the user experience, they make 30X more money than by giving away Android. The other manufacturers will build low to midrange phones, the occasional high end device, and Google can still collect ad revenue from the cheaper phones as well as their phones.
 

smartpatrol

Senior member
Mar 8, 2006
870
0
0
Because it's not their business model. Focus is more important than chasing short term profits. Google's goal is to commoditize the hardware. They like that you can get an Android phone for $100 on a prepaid plan. In the long run, it's not the boutique OS on premium hardware that makes the most money, it's the company making ubiquitous software that runs on commodity hardware made by others. It's not in Google's interest that Android hardware is very profitable, it's in Google's interest that it's cheap.

Apple took the "boutique OS" on premium hardware approach, and they're now the most valuable company in the world. They make far more profit from the iPhone than all the Android manufacturers put together make from Android. I find it VERY hard to believe that Google would spend $12 billion to buy Motorola, only to crank out the cheapest commodity hardware possible in order to (further) saturate the market with Android phones.

But fine, let's say that Google uses Motorola that way. How is this any more comforting to HTC, Samsung, etc? That will just depress prices and erode at their already thin profit margins. Why would anybody want to enter the Android market when Motorola is selling Android phones, subsidized by Google, at low prices or even as a loss leader in order to funnel more people towards Google services?
 

Pliablemoose

Lifer
Oct 11, 1999
25,195
0
56
Why would any corporation buy a manufacturing arm and just allow it to be average?

Google is too competitive to do that.

When has Google said a half effort is enough in any of their endeavors? The corporate culture at Google is to kick ass, take names, and change the world...

Google is saying they'll keep Moto at arm's length because they have to say it.

What do you expect them to say?

"Yes, we bought MMI, we're going to essentially take Android private, put our cooperation with Android handset makers on the back burner while we quietly focus on turning Motorola into a company that can rival Apple. Sorry guys, hope you enjoyed the free ride."
 

badb0y

Diamond Member
Feb 22, 2010
4,015
30
91
It's impossible to believe that Google bought Motorola just for patents or just to in the hardware market. They definitely want a piece of Apple's pie. I am not saying Samsung or HTC are going to be left out in the cold but I wouldn't be shocked if Google/Motorola collaboration leads to a line of high quality premium class Android devices.
 

tommo123

Platinum Member
Sep 25, 2005
2,617
48
91
cant see google locking android down and not allowing other manufs to use it / making it less appealing to use it on other manufs hardware.

that would remove a huge part of the reason some people use android. it's the anti apple, it would also limit the number of phones android would run on therefore less ad revenues.

google can have their cake and eat it too if they have the motorolla phones be "the google experience" or whatever, else get a HTC, samsung, LG etc etc etc. a lost sale going to samsung - a samsung phone running android is better than to an iphone or winmo7
 

exdeath

Lifer
Jan 29, 2004
13,679
10
81
Looking forward to a REAL update to Droid X with stock Android minus Blur + unlocked boot loader.
 

WelshBloke

Lifer
Jan 12, 2005
31,446
9,351
136
LOL, I like you guys and you're pretty sharp etc, but you-all are really blinded by this stuff.

They're buying Motorola.

They won't even have to take Android private, the other manufacturers will be walking away.

Look at the companies Google has screwed over the years, (I'm not saying they're evil or anything, they're just competitive as hell and innovative, and that's a disruptive thing in business) They just spent 2 years worth of profits to buy Moto.

Android returns maybe $10/user/year in ad revenue, Apple makes $300/phone per user.

If Google focuses on mid to high end phones with Moto, kills the fragmentation issue, polishes up the user experience, they make 30X more money than by giving away Android. The other manufacturers will build low to midrange phones, the occasional high end device, and Google can still collect ad revenue from the cheaper phones as well as their phones.

How much was Moto making out of its phones?
 

lothar

Diamond Member
Jan 5, 2000
6,674
7
76
LOL, I like you guys and you're pretty sharp etc, but you-all are really blinded by this stuff.

They're buying Motorola.

They won't even have to take Android private, the other manufacturers will be walking away.

Look at the companies Google has screwed over the years, (I'm not saying they're evil or anything, they're just competitive as hell and innovative, and that's a disruptive thing in business) They just spent 2 years worth of profits to buy Moto.

Android returns maybe $10/user/year in ad revenue, Apple makes $300/phone per user.

If Google focuses on mid to high end phones with Moto, kills the fragmentation issue, polishes up the user experience, they make 30X more money than by giving away Android. The other manufacturers will build low to midrange phones, the occasional high end device, and Google can still collect ad revenue from the cheaper phones as well as their phones.
Walking away to where?
The pasture isn't any greener on the other side.
 

BenSkywalker

Diamond Member
Oct 9, 1999
9,140
67
91
When has Google said a half effort is enough in any of their endeavors? The corporate culture at Google is to kick ass, take names, and change the world...

I would have to agree with you on that point. This is why I can't see why they would want to jump all over the short sighted, short term strategy that a company like Apple uses.

A singular example of how they can utilize Moto to enormously benefit themselves without hurting the other companies. NFC. Google makes every Moto phone ship with NFC to give them an installed base in the tens of millions- this helps them push corporations to start supporting the standard at which point the non Moto Android vendors can then include it in their handsets. With Google being the driving force behind NFC payment systems their profit potential on cornering that market early could easily more then cover the entire cost of Motorola within a few years of it taking off. WSJ is currently estimating NFC payments will be a $618 Billion dollar business by 2016(anyone who understands how electronic payments works realizes that is ~$18 Billion for the people handling the flow of money).

That is just one example of how Google could continue to operate Android exactly how they have previously done, while still using Moto as a very valuable tool without hurting the other makers and without having to worry about making the balance sheet look a certain way for Moto made products(if that played out exactly as the financial experts expect and Google utilitzed Moto as I stated Moro could continue losing money at its' current rate and Google would still be at a net gain including acquisition cost by 2020 ignoring the value of the IP entirely).

There are many other possible avenues to explore(Google TV etc) on how Google can utilize Moto without hurting anyone else.

Windows Mobile is a quick option, Samsung has Bada already, it's not like it's impossible for someone to develop a different OS either.

Samsung increased their market penetration by ~500% using Android. Going back to failure platforms isn't what most people would consider sane.
 

Renob

Diamond Member
Jun 18, 2000
7,596
1
81
It's impossible to believe that Google bought Motorola just for patents or just to in the hardware market. They definitely want a piece of Apple's pie. I am not saying Samsung or HTC are going to be left out in the cold but I wouldn't be shocked if Google/Motorola collaboration leads to a line of high quality premium class Android devices.

are there not "high quality premium class Adroid devices" now?
 

Pliablemoose

Lifer
Oct 11, 1999
25,195
0
56
That's what I thought, I just wondered how pliable thought Google would make 30X as much by concentrating on phones not software.

Google makes $6-10 per Android user per year.

Apple makes $300 per phone per user on each sale, irrespective of ad revenue, throw in ad revenue, and it's more.

If Google leverages Motorola (and they will) they'll generate a much better margin, and if they can keep the other manufacturers on board they'll dominate the mobile market even more than they currently do, and make a ton of cash.

And I never said they shouldn't concentrate on software, they have to concentrate on phones and software.

HTC will likely keep on using Android, Samsung will probably start to release Bada OS'd phones in the US and putting it on higher end devices as they move away from Android.
 

preslove

Lifer
Sep 10, 2003
16,754
63
91
LOL, I like you guys and you're pretty sharp etc, but you-all are really blinded by this stuff.

They're buying Motorola.

They won't even have to take Android private, the other manufacturers will be walking away.

No one has answered my question. What platform are all these manufacturers going to rush to? WP7 is on most of the manufacturer's already and they're LOSING MARKETSHARE.

Jesus, all the stuff you've been posting about this deal is pure drivel. Samsung ain't going to suddenly introduce Bada to the US and Europe and start succeeding.
 

BenSkywalker

Diamond Member
Oct 9, 1999
9,140
67
91
What makes you think it is a short sighted, short term strategy?

Maximizing profits no matter the other costs(including marketshare). It is working very well for them currently. They could likely gain a considerable amount of marketshare if they followed the rest of the industry in terms of pricing model, but that would absolutely hurt their quarterly profit numbers in the short term. Free 3GS on contract? iPhone4 for $50? That is where Apple would be if they were the rest of the industry(and they would still be very profitable), and that would almost certainly help their marketshare numbers enormously, but it seems they would rather take their short term profits and allow the Android ecosystem to grow far larger then their own.

Apple is helping hundreds of thousands of users every week decide to get an Android device. It normally is considered short sighted to help push customers to your biggest competitor. Short term it will help them out, reality is they probably could already have a dominant position in the global market if they were willing to reduce margins. They almost certainly could have killed Android before it took off, but they got large quarterly numbers for a few years instead. Short term versus long term.
 

dguy6789

Diamond Member
Dec 9, 2002
8,558
3
76
It's my opinion that Samsung is trying to be the Apple of Android pretty hard right now. That is to say, they want their brand to become synonymous with words like top tier, high quality, and premium. Their Galaxy S 2 phone is the nicest Android device ever produced and the sales are off the charts without it even launching in the US yet. They just hired Cyanogen too. Considering their efforts in the Galaxy S and Galaxy Tab, I find it really unlikely for them to leave Android, even with Google putting its weight behind Moto.
 

Pliablemoose

Lifer
Oct 11, 1999
25,195
0
56
It's my opinion that Samsung is trying to be the Apple of Android pretty hard right now. That is to say, they want their brand to become synonymous with words like top tier, high quality, and premium. Their Galaxy S 2 phone is the nicest Android device ever produced and the sales are off the charts without it even launching in the US yet. They just hired Cyanogen too. Considering their efforts in the Galaxy S and Galaxy Tab, I find it really unlikely for them to leave Android, even with Google putting its weight behind Moto.

I'm not saying the changes are going to come overnight, or that Samsung will completely dump Android, yet...

It's foolish to think things will stay the same though.
 
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