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January 29, 2014

Google Sells Motorola to Lenovo

Google's decision to sell Motorola Mobility to Lenovo for $2.91 billion is even more surprising than Google's acquisition of Motorola Mobility for $12.5 billion in 2011.

"Lenovo will now acquire world-renowned Motorola Mobility, including the MOTOROLA brand and Motorola Mobility's portfolio of innovative smartphones like the Moto X and Moto G and the DROID™ Ultra series. In addition to current products, Lenovo will take ownership of the future Motorola Mobility product roadmap. Google will maintain ownership of the vast majority of the Motorola Mobility patent portfolio, including current patent applications and invention disclosures."

Motorola's patents weren't that valuable, Google didn't manage to make Motorola profitable, it started to compete with the other Android OEMs and sold Motorola at a loss. Still, why not try harder to make Motorola shine once again? Why admit defeat and show that your strategy was wrong?

I think the answer can be found in Google's licensing agreement with Samsung:

"Samsung Electronics and Google Inc. furthered their long-term cooperative partnership with a global patent cross-license agreement covering a broad range of technologies and business areas. The mutually beneficial agreement covers the two companies existing patents as well as those filed over the next 10 years."

Samsung is the biggest Android OEM and a switch from Android to Tizen would be a very bad news for Google. If Samsung used its dominant position and asked Google to get rid of Motorola, Google didn't have other options.

Motorola is a lost bet, Google showed that the health of the Android ecosystem is more important than owning Motorola.

"Lenovo has the expertise and track record to scale Motorola Mobility into a major player within the Android ecosystem. This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere. As a side note, this does not signal a larger shift for our other hardware efforts. The dynamics and maturity of the wearable and home markets, for example, are very different from that of the mobile industry. We're excited by the opportunities to build amazing new products for users within these emerging ecosystems," said Larry Page, Google's CEO.

Apparently, Motorola's Advanced Technology Group will continue to work at Google. "That means the Ara modular smartphone concept, as well as sensors you swallow and passwords you tattoo on your skin. The Advanced Tech team is headed by one-time Defense Advanced Research Projects Agency director Regina Dugan, and has been behind some of the more sci-fi things that Google has demonstrated since acquiring Moto's mobile biz."

{ Thanks, Jérôme and Tolis . }

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