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"It’s still early days for Google’s hardware business." Why no mention of Motorola in 2011? Google bought it for $12.5B, and sold it 2014 for $3B. I think it

"It’s still early days for Google’s hardware business." Why no mention of Motorola in 2011? Google bought it for $12.5B, and sold it 2014 for $3B. I think it would have made the blog post better to give some explanation for why Things Are Different This Time.

cromwellian 9y ago
They also sold Motorola Home for $2.35B. https://www.wired.com/2014/01/google-moto/ https://www.wired.com/2014/01/google-moto/
- bcatanzaro 9y ago
  All this explanation is great - as I said it would have improved the blog post to include some of that. I'm not arguing that it's not actually different this time. But I think they should have made the case in the blog post.
  - pgeorgi 9y ago
    It might have improved understanding of some historical tidbits at the cost of distracting from today's story. Corporate blogs are still PR venues first and foremost, aimed at investors and the media. Investors already know how the moto deal turned out (or are willing to look into it themselves to check the numbers). The media needs soundbites.
beilabs 9y ago
Was that not a patent grab? I always thought that was the main premise.
paulie_a 9y ago
From my understanding that was specifically for the gigantic patent portfolio and little interest in the hardware. Hence the immediate spinoff.
sangnoir 9y ago
Google bought Motorola patents that came with hardware businesses attached for defense purposes, not because they wanted in on the hardware business. This was after they found themselves unarmed during a thermonuclear patent war. Google dropped the hardware businesses and kept the patents. The patent market was notably frothy at the time, and conventional wisdom then valued Motorola's patent chest at $4.0-4.5 billion (Apple + MS consortium bought the comparable Nortel trove for a price in that ballpark). If that value is correct, then Google made a profit on buying and selling Motorola (patents + Moto Home + Moto Mobile).
- personjerry 9y ago
  > not because they wanted in on the hardware business I don't think that's true, see Project Ara [0] [0] https://en.wikipedia.org/wiki/Project_Ara https://en.wikipedia.org/wiki/Project_Ara
  - cptskippy 9y ago
    I'm sure the hardware was a bonus but at the time the purchase was primarily driven by the patents. Apple, Microsoft, Oracle , Cisco, and all the other big players have shed loads of patents for just about everything and uses them as counter measures against any potential litigation. Google at the time was lacking in such patents and was vulnerable. Motorola presented an opportunity with it's extensive cache of patents to level the playing field.
  - on_and_off 9y ago
    Google also kept the experimental team (I don't remember its name) from Moto.
- justicezyx 9y ago
  Typical forced intention after fact. To say Google not interested in hardware when they purchased Motorola is plain baseless.
  - y4mi 9y ago
tw04 9y ago
So two things. The title is LITERALLY: "Google signs agreement with HTC, continuing our big bet on hardware" - notice the continuing. The guy writing the blog post came from Motorola... so I don't think he's trying to hide it. As others have mentioned, Motorola was 90% about the patents because they were fighting trench warfare with Apple AND Microsoft at the time. And 10% about having some say over a premium phone that wasn't full of garbage overlays. They were at war with Samsung over Touchwiz and Tizen at the time. So ya... it was 100% a strategic move, and exactly why the bailed as soon as humanly possible.
cptskippy 9y ago
> I think it would have made the blog post better to give some explanation for why Things Are Different This Time. When they bought Motorola it was for patents, they absorbed the patents but kept the remainder of the business separate from Google. Eventually breaking it apart and selling it off. This announcement doesn't sound like they are acquiring then entirety of HTC but rather a team within HTC. And that the team is joining Google, not remaining a separate entity. So things are different because they're acquiring a part of HTC and folding it into their organization for the explicit purpose of furthering their hardware pursuits. Not just buying up the whole company for it's patents and selling off the remainder.
jonas21 9y ago
The way this worked out was that Google spent $12.5B, but they got: Cash: $3B Tax Credits: $1B Sale of Motorola Home: $2.4B Sale of Motorola Mobility: $2.9B --------------------------------- Total: $9.3B So Google ended up paying about $3.2B for Motorola's patent portfolio, which was valued at $5.5B. https://dealbook.nytimes.com/2014/01/29/did-google-really-lose-on-its-original-motorola-deal/?smid=tw-share&_r=0 https://dealbook.nytimes.com/2014/01/29/did-google-really-lo...
- notatoad 9y ago
  you can make the math look okay as long as you ignore the $200-500M per quarter in losses that google swallowed for the 2.5 years that they owned motorola.
  - xapata 9y ago
    Which would make the deal about break even, depending on whether that was more like $1B or $2B lost each year.
    - nimchimpsky 9y ago
      It's almost as if the people running Google are not idiots.
      - IshKebab 9y ago
        That's a stupid thing to say. People running large companies can be idiots. Look at Microsoft's Nokia deal.
        heartbreak 9y ago
        There’s a difference between being an idiot and losing a bet, right?
        9y ago
epigramx 9y ago
It's a blog post from google.com, expect it to be biased.
gator-io 9y ago
Don't forget Microsoft and Nokia! The only explanation is patents.
- usr1106 9y ago
  Is it? Nokia (yes, the company still exists, it has just left the consumer market) kept quite many patents and I think there licensing is profitable (I don't remember the exact conditions) For which phones Microsoft would have needed patents? They had no phones before they bought Nokia.
- rdl 9y ago
  The Nokia deal was botched/didn’t make sense even with patents.
rifung 9y ago
I think they are referring to Google's hardware business as in the internal hardware unit within Google. While it's true that Google bought Motorola, Motorola employees didn't become Google employees as far as I know? In this case though I think the HTC division will operate within Google as opposed to a separate entity like Motorola remained.

cromwellian 9y ago

They also sold Motorola Home for $2.35B. https://www.wired.com/2014/01/google-moto/ https://www.wired.com/2014/01/google-moto/

bcatanzaro 9y ago
All this explanation is great - as I said it would have improved the blog post to include some of that. I'm not arguing that it's not actually different this time. But I think they should have made the case in the blog post.
- pgeorgi 9y ago
  It might have improved understanding of some historical tidbits at the cost of distracting from today's story. Corporate blogs are still PR venues first and foremost, aimed at investors and the media. Investors already know how the moto deal turned out (or are willing to look into it themselves to check the numbers). The media needs soundbites.

beilabs 9y ago

Was that not a patent grab? I always thought that was the main premise.

paulie_a 9y ago

From my understanding that was specifically for the gigantic patent portfolio and little interest in the hardware. Hence the immediate spinoff.

sangnoir 9y ago

Google bought Motorola patents that came with hardware businesses attached for defense purposes, not because they wanted in on the hardware business. This was after they found themselves unarmed during a thermonuclear patent war. Google dropped the hardware businesses and kept the patents. The patent market was notably frothy at the time, and conventional wisdom then valued Motorola's patent chest at $4.0-4.5 billion (Apple + MS consortium bought the comparable Nortel trove for a price in that ballpark). If that value is correct, then Google made a profit on buying and selling Motorola (patents + Moto Home + Moto Mobile).

personjerry 9y ago
> not because they wanted in on the hardware business I don't think that's true, see Project Ara [0] [0] https://en.wikipedia.org/wiki/Project_Ara https://en.wikipedia.org/wiki/Project_Ara
- cptskippy 9y ago
  I'm sure the hardware was a bonus but at the time the purchase was primarily driven by the patents. Apple, Microsoft, Oracle , Cisco, and all the other big players have shed loads of patents for just about everything and uses them as counter measures against any potential litigation. Google at the time was lacking in such patents and was vulnerable. Motorola presented an opportunity with it's extensive cache of patents to level the playing field.
- on_and_off 9y ago
  Google also kept the experimental team (I don't remember its name) from Moto.
justicezyx 9y ago
Typical forced intention after fact. To say Google not interested in hardware when they purchased Motorola is plain baseless.
- y4mi 9y ago

tw04 9y ago

So two things. The title is LITERALLY: "Google signs agreement with HTC, continuing our big bet on hardware" - notice the continuing. The guy writing the blog post came from Motorola... so I don't think he's trying to hide it. As others have mentioned, Motorola was 90% about the patents because they were fighting trench warfare with Apple AND Microsoft at the time. And 10% about having some say over a premium phone that wasn't full of garbage overlays. They were at war with Samsung over Touchwiz and Tizen at the time. So ya... it was 100% a strategic move, and exactly why the bailed as soon as humanly possible.

cptskippy 9y ago

> I think it would have made the blog post better to give some explanation for why Things Are Different This Time. When they bought Motorola it was for patents, they absorbed the patents but kept the remainder of the business separate from Google. Eventually breaking it apart and selling it off. This announcement doesn't sound like they are acquiring then entirety of HTC but rather a team within HTC. And that the team is joining Google, not remaining a separate entity. So things are different because they're acquiring a part of HTC and folding it into their organization for the explicit purpose of furthering their hardware pursuits. Not just buying up the whole company for it's patents and selling off the remainder.

jonas21 9y ago

The way this worked out was that Google spent $12.5B, but they got: Cash: $3B Tax Credits: $1B Sale of Motorola Home: $2.4B Sale of Motorola Mobility: $2.9B --------------------------------- Total: $9.3B So Google ended up paying about $3.2B for Motorola's patent portfolio, which was valued at $5.5B. https://dealbook.nytimes.com/2014/01/29/did-google-really-lose-on-its-original-motorola-deal/?smid=tw-share&_r=0 https://dealbook.nytimes.com/2014/01/29/did-google-really-lo...

notatoad 9y ago
you can make the math look okay as long as you ignore the $200-500M per quarter in losses that google swallowed for the 2.5 years that they owned motorola.
- xapata 9y ago
  Which would make the deal about break even, depending on whether that was more like $1B or $2B lost each year.
  - nimchimpsky 9y ago
    It's almost as if the people running Google are not idiots.
    - IshKebab 9y ago
      That's a stupid thing to say. People running large companies can be idiots. Look at Microsoft's Nokia deal.
      - heartbreak 9y ago
        There’s a difference between being an idiot and losing a bet, right?
        9y ago

epigramx 9y ago

It's a blog post from google.com, expect it to be biased.

gator-io 9y ago

Don't forget Microsoft and Nokia! The only explanation is patents.

usr1106 9y ago
Is it? Nokia (yes, the company still exists, it has just left the consumer market) kept quite many patents and I think there licensing is profitable (I don't remember the exact conditions) For which phones Microsoft would have needed patents? They had no phones before they bought Nokia.
rdl 9y ago
The Nokia deal was botched/didn’t make sense even with patents.

rifung 9y ago

I think they are referring to Google's hardware business as in the internal hardware unit within Google. While it's true that Google bought Motorola, Motorola employees didn't become Google employees as far as I know? In this case though I think the HTC division will operate within Google as opposed to a separate entity like Motorola remained.