Google's Motorola Mobility Buy Raises Android Issues

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Google's $12.5 billion acquisition of mobile phone maker Motorola Mobility raises significant concerns around the Android operating system, according to industry experts.

Ovum analyst Nick Dillon said that by becoming a hardware vendor, Google will "move from the position of partner to that of competitor to Android handset manufacturers."

google motorola mobility acqusition
While the move made sense for Google in terms of patents, Dillon said he had "concerns" about it potentially placing "significant strain on the Android ecosystem".

"If, for example, Google provides preferential access to the Android code to its own hardware division, this would place other vendors at a disadvantage and may lead them to question their commitment to the platform, potentially pushing some towards other platforms," he said.

"Given Google's recent moves to exert greater control of the implementation of the Android platform, such as restricting access to the Android source code to select hardware partners, such a move is not beyond the realm of the imagination."

If this happens, the beneficiary would be Microsoft and the Windows Phone platform, he said, because many larger Android manufacturers such as Samsung, LG, HTC and ZTE are also Windows Phone licensees.

As the move was announced, Android partners Samsung, Sony Ericsson, HTC and LG issued almost identical statements to each other. They all insisted in essence that they "welcome" the news of Google's "commitment to defending Android".

Charles Golvin, principal analyst at Forrester, said that "product strategists" at the firms "are certain to revisit their Windows Phone hedge strategy".

"Google will need to exercise careful stakeholder management to ensure that their additional Android partners (Samsung, HTC, and others) foster continued growth of the Android OS outside of purely Motorola," said Fred Huet, managing director at telecoms advisory firm Greenwich Consulting. "While the acquisition provides exciting growth potential, they will not want to put all their eggs in one basket."

Huet said that "Google's intention to dominate the mobile ecosystem beyond software" had "always been crystal clear". But he warned that Apple had the dominant position in the market, a fact that would prompt Google to take further action, and the acquisition would likely be followed by Google's development "of an iPad rival tablet device".

"Apple has demonstrated that to own the consumer you have to provide their device, which is an approach that Google will likely adopt, with a Google tablet device providing a mobile link into the cloud," he said.

The move also raised the prospect of other non-hardware companies making a similar move, Huet said. He questioned whether "following in the footsteps of the Microsoft-Nokia partnership, does the Google-Motorola deal point to mobile future made on alliances? And if so, who will Facebook buy?"

Aside from the effect on Android, analysts and other industry participants agreed that the move delivers Google with a raft of important patents.

Alison Hyde, technology fund manager at Cavendish Asset Management, said: "In July, Google found itself massively outbid, by a margin of several billion dollars, for a slice of Nortel's coveted patent portfolio by a consortium including Apple, Microsoft, and RIM... This acquisition may put it on a firmer footing as it continues to fight its rivals for an ever bigger slice of the smartphone pie."

Golvin at Forrester said Google was keen to use the acquisition to spread its influence across connected devices. Consumers "have multiple choices sitting in front of them at any moment and are often connected to more than one device - today it's the PC, tablet, phone, and TV, but connections are beginning to pervade the car and myriad devices in the home", he said.

"Android is present in most of these devices today and aims, with GoogleTV and Android@home, to be in all of them. With the exception of the PC, Motorola has products in these market segments today and is the only large original equipment manufacturer exclusively reliant on Android for its mobile devices."


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This story, "Google's Motorola Mobility Buy Raises Android Issues" was originally published by Computerworld UK.

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