By ditching Motorola, Google shifts its focus to gadgets
“Selling off Motorola frees Google to focus on new areas of growth and they are focused on quite a few,” said Jeff Kagan, an independent industry analyst. “GoogleX is the part of the company that focuses on the future. Some of the most recent ideas range from the Nest system for home automation to robotics, driverless cars, elevators to space, pharmaceuticals, cancer treatments and other medical and health-related business.”
Last week, Google announced that it was selling its Motorola handset division to the Lenovo Group for nearly $3 billion. While still holding onto most of the Motorola patent portfolio, including current patent applications and invention disclosures, Google is letting go of the rest.
Google took a big financial hit with the whole Motorola deal: The company bought Motorola for $12.5 billion in 2011, meaning it’s selling off Motorola—which lost $248 million in the last quarter alone—at a fraction of what it paid.
Even so, Google executives got what they wanted from the acquisition—Motorola’s patents.
The purchase was largely aimed at helping Google defend itself against various patent infringement lawsuits over the Android OS, since Motorola had one of the smartphone industry’s largest patent libraries.
Now without Motorola hanging around its neck, Google is free to laser its focus on more potentially lucrative businesses.
Not long before that deal was announced, Google bought robotics heavyweight Boston Dynamics. Given the company’s work on developing self-driving cars for the last few years, buying a major robotics company could enable it to bolster the cars’ autonomous software.
Google also is knee-deep in the wearable computer business.
In addition to that, the company announced earlier this month that it’s developing a smart contact lens that will monitor diabetics’ blood sugar levels.
“Being done with Motorola takes some work off Google’s plate, and it’s not like they’re a big loser here,” said Dan Olds, an analyst with The Gabriel Consulting Group.
Gartner Inc. analyst Hugues de la Vergne agreed, saying Google now will hone its focus on higher growth opportunities, like wearables, connected cars and connected homes.
And Kagan noted that he thinks the purchase and subsequent sale of Motorola went exactly as Google planned.
“They just wanted the Motorola patents and not the company to begin with. So this is just part of their master plan,” Kagan said, adding that Google has simply rid itself of extra weight. “I see Google continuing to grow and continuing to amaze us with their wow factor. The real question now is, what’s coming next from Google?”