Google’s planned acquisition of Motorola has created numerous aftershocks across the mobile industry, sparking debate into how the deal will change relationships among the various participants in the ecosystem.
The Financial Times (FT) reports that Nokia, which adopted Microsoft’s Windows Phone as its smartphone platform of choice earlier this year, said the deal “could prove to be a massive catalyst for the Windows Phone ecosystem.” There was some speculation that the deal could see Nokia become more attractive as a target, with an analyst with Nordea Bank telling Bloomberg that in comparison with Motorola, “there is quite a bit more on the table and yet there is little difference between the valuations of the two companies.” However, with Microsoft widely seen as the most likely acquirer of Nokia, it was noted that the companies already have a strong partnership and that Microsoft has significant patent holdings of its own – making an acquisition less likely.
It was suggested that Samsung, HTC and LG Electronics, which have already offered smartphones powered by the Microsoft platform alongside Android devices, may choose to review their strategies once Google begins competing with them directly via its Motorola arm. These companies will also be watching closely to see if Motorola gets preferential access to new Android releases or technologies, which would create an uneven playing field in the Android handset market.
The FT had a comment from Samsung, which noted that: “the news is so sudden that we are still studying its implications ... but we are not viewing it so negatively.” Bloomberg reports that HTC has also been positive, and that Google strengthening its mobile patent portfolio will be “beneficial for the whole [Android] group, the whole camp.”
Patent holding company InterDigital saw its share price fall by more than 10 percent, after its value soared on previous speculation that Google was considering an acquisition of this business. With Google not only having bolstered its patent armoury through its Motorola buy, but also having the US$12.5 billion acquisition of a mobile phone vendor to manage, its appetite for further deals may be dampened. However, there is also the possibility that one of Google’s rivals will look to InterDigital for a deal, in order to strengthen their position against the combined Google/Motorola business.
The Wall Street Journal suggested that any disruption among the Android community could work in RIM’s favour, by providing the BlackBerry maker with “much needed time to bolster its own handset offerings.” RIM could also become a potential acquisition target for bigger players “looking to grab patents or RIM’s corporate-heavy customer base.”
According to GigaOM, Motorola had previously held talks with Microsoft about a deal, with the computing giant seeing the handset maker’s intellectual property portfolio as a tool that would allow it to “torpedo Android even further.” This brought Google to the table, with the advantage that it also showed more interest in the company’s handset business than Microsoft.