Google Reportedly Sells Moto to Lenovo for $2-$3 Billion

| Analysis

Riddle me this: how do you make US$7 billion disappear? Answer: be Google, start with with $12.5 billion, buy Motorola Mobility, mismanage it for a few years, and then sell what you can for $5.5 billion. That may sound like the whacky premise of Brewster's Millions 2: There's a New Fortune to Be Wasted, but according to China Daily, it's really happening.

Not so much...

The newspaper didn't name its sources, but said that the deal was likely to be announced on Thursday morning. The report also claimed the purchase price was "at least $2 billion." TechCrunch claims it confirmed the report, citing unnamed sources who put the purchase at $3 billion.

Counting the $2.5 billion Google already got for parting out Moto's cable box business, that would bring the grand total for Google's illustrious foray into half-assing hardware to -$7 billion, -$8 billion if you throw in the money Motorola Mobility has lost since the acquisition.

"But wait!" I can hear you cry. "Google still has all those awesome patents that have proved completely ineffective at defending Android against Apple's charges of intellectual theft! After all, that's the real reason Google bought Moto!"

The sale to China's Lenova includes 10,000 of those great and glorious patents, though surely those were the 10,000 least great and glorious, right? Looking at the numbers that leaves roughly 2,500 patents still in Google's hands, with a few thousand patent applications, too.

And to be fair, Google did just win $1.7 million—that's million, with an "m"—from Microsoft for patent infringement, bringing the losses down to a more manageable $7.9983 billion.

Note that it's really cool how Google is transferring all those American patents to a Chinese company, too. To that end, Brian S. Hall made a salient observation on Twitter, saying, "Motorola was a great American company. Yes, I partly blame Google for it winding up in hands of Chinese company. A pawn."

The real shame here is that it didn't have to be this way. Motorola Mobility could and should have been used by Google to become a whole widget smartphone, tablet, and mobile devices company. Google should have thrown the entirety of its Android resources into making the absolute best devices it could.

Instead, Google pretended that it didn't own Moto and treated its stepchild like every other Android OEM out there. The end result of this brilliant strategy is that Moto's value plummeted by a billion dollars or so each and every quarter that Google owned it.

When I think of all the crowing Apple haters did when Google announced this acquisition, and how the acquisition itself was hailed for its genius in levelling the patent battlefield, I want to line all those folks up and my best Nelson Muntz.

"Ahh-ha!"

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5 Comments Leave Your Own

mrmwebmax

+

Oookay, they sell Motorola, a perfect fit with Android…right after buying Nest, a thermostat company??? Is a Magic 8-Ball prominent in their corporate strategy meetings?

aardman

“Motorola Mobility could and should have been used by Google to become a whole widget smartphone, tablet, and mobile devices company. Google should have thrown the entirety of its Android resources into making the absolute best devices it could.”

My take away is that this whole widget approach is a lot harder than most people, esp. tech CEO’s, think and Apple get’s little to no credit for their unique and unparalleled talent and skill.

Bosco (Brad Hutchings)

Wow, Bryan. Google is keeping the patents and Moto’s advanced tech group, which is currently working on bringing a modular phone to market. In the meantime, they’ve built a formidable price/feature competitor to Samsung. Right now in smartphone (exc. phablet) space, there are only two reasons not to buy a Moto G off contract:
1. You want an iPhone.
2. You want a Moto X.
Meanwhile, Apple does not have a $200 contract free phone. That’s gonna start leaving a mark.

skipaq

All the reports that I have seen have Google keeping most of the patents and Lenovo buying everything else. Perhaps there are more details forthcoming.

JustCause

Google is acting like a teenager with a ton of money and no sense, it’s just all over the place. I can’t believe the corp board is backing all these moves.

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