My company socialnuggets scoured through social media data to see who the winners and losers were in Google’s acquisition of Motorola. Some of them are very obvious. Motorola and Microsoft in the winners section, and Android OEMs such as HTC, Samsung and LG in the losers section. However, it is unclear whether Apple, Nokia, RIM and Mobile operators are winners or losers in this race. Here are some of our thoughts. Please add your comments:
Clear Winners
Motorola is a winner since it got an excessive premium over its current share price. Microsoft is a winner since all of Android licenses now want to at least invest some portion of their resources on Microsoft’s Windows Phone and its latest Mango version of Windows Phone is making progress in the market. PC Mag’s article has done a good job in explaining this.
But how will Nokia, RIM and Apple fare from Googorola?
Clear Losers
Google’s Android, which has been gaining in popularity, may see some defensive moves from its OEMs such as HTC, Samsung and LG who feel threatened by Google- Motorola phone despite Google’s assurance to the contrary. Google is a loser since it has overpaid for a patent portfolio that may not have the same level of relevance today as when these patents were developed. To quote Dan Ravicher, the executive director of the Public Patent Foundation from this Huffington Post article” There’s a patent bubble — a lot of speculation and bidding up. This reminds me of the housing bubble, the dot-com bubble. Five years from now, people will realize that they have overbid.”
What about Apple, Nokia, RIM and others?
Is Apple a loser in this? If OEM’s jump the Android boat, Apple will see less competition from Android. In that case, Google will put its energy in Motorola phone and in creating an end-to-end experience like Apple which may be more of a threat to Apple in the long term.
Is it a win for RIM, the makers of Blackberry phones? RIM has been losing market share and this may accelerate it. However, it also has a rich set of patents which will now be overvalued like that of Motorola’s thereby helping increase the valuation of the company if someone were to acquire it.
Is it a win for Nokia? Nokia had a choice of betting on either Android or Windows Phone and it chose the later and now must be happy with its decision. If Google indeed becomes an end-to-end supplier that will put Nokia at a disadvantage. Like RIM, it also has a very rich patent portfolio that may be overvalued if Microsoft were to pull the trigger on buying Nokia.
This may reduce the choice for both the consumer and mobile operators and when that happens prices go up and innovation suffers. So no matter which company wins, the consumer loses.
Conclusion
With this deal of Google buying Motorola, Microsoft and Motorola seem to be clear winners while Google and most of Android OEMs seem to be clear losers. Apple may benefit or lose depending on how Google handles this acquisition. RIM and Nokia may benefit or lose depending on what Microsoft may decide to do. This may also affect consumer and mobile operator choices when it comes to smartphones.
