4 ms·

Google should buy RIM

12 points by BvS 15y ago

According to this report http://www.businessweek.com/magazine/the-biggest-ip-war-chests-08042011-gfx.html RIM has the biggest I.P. war chest in mobile (more than Microsoft or even Nokia). With a current market cap of about 12 billion US$ it would be "only" 3 times more expensive than the Nortel patents but would bring much more to the table than just patents (RIM is stil pretty profitable and could help Google significantly in the attempt to gain more corporate clients).

nextparadigms 15y ago
Yes, that's what I was immediately thinking too when I saw that. RIM is still quite expensive though, and unless they plan on turning RIM around and getting a strong foothold in enterprise with Android within like a year, then $12 billion seems too expensive for patents. This also reminds me what a mistake Google did when they didn't buy Palm. They could've paid only $1.2 billion for their huge mobile patent chest (probably about as big as RIM), their WebOS technology, which I'm sure they could've used, and also 1000 employees, where many of them were engineers. Palm would've been a total bargain for Google. With RIM, Google has 2 strategies: 1) Get them now by spending 1/3 of their cash, and immediately switch the company to Android. If they move it fast and do it right, they have the opportunity to make Android bigger in enterprise than iPhone will ever be. With RIM, they also have the opportunity to make a lot of money from hardware - maybe close to what Apple is making. The downside is some Android partners may not be too happy about this, but as long as they remain fair towards them and give them access to Android no later their their own RIM division, I don't think they'll mind it too much. They'll still want to use Android because Android is still the most popular smartphone platform they can use by far, right now. It's not much different than if Microsoft bought a PC manufacturer. What I'd love about it as a consumer, is that there would be a strong manufacturer, Google's no less, that will make great stock Android smartphones. 2) They can let RIM collapse, and buy them in 2013 for much less just for their patents, maybe for 2-3 billions or so. Either way they have to take into account that others, like Microsoft might bid for them, too, although I'm not entirely sure Microsoft will buy them right now, after their partnership with Nokia. And at least Android has 50% market share, while WP7 has 1%, so Microsoft's other partners besides Nokia might leave them altogether. And then if Microsoft can't turn WP around with the fast declining RIM, and the even faster declining Nokia, they're gone from the mobile space, and they'll take both RIM and Nokia with them. Google buying RIM at its peak is one thing, Microsoft buying it when WP hasn't even become larger than WebOS, is quite another. Why would the others stick around for an OS that doesn't bring them any significant sales, and when Microsoft will play strong favorites with Nokia and of course RIM, which would be theirs?
- astrodust 15y ago
  I'm sure that Google could turn RIM into Google North and do quite well with the people alone. The patent portfolio and the technology wouldn't hurt either.
presty 15y ago
Google buying RIM would make the other Phone companies very unsettled
deleted 15y ago
[deleted]
rst 15y ago
The trick, strategically, would be arranging to do this without having the transaction turn into yet another bidding war --- which they'd be at risk of losing once again to a coalition of their adversaries (as with the Nortel patent auction). Perhaps they could arrange a coalition of their own, involving IBM, or one of the other phone manufacturers as the ones who would take over the actual phone business...
- nextparadigms 15y ago
  I was actually very surprised they didn't do this to begin with in the Nortel case, especially since the patents being bought would've helped all of them. The risk was simply too high for Google even if it was only Apple bidding against them, without all the others. Apple has twice as much cash as they do, and if Apple really wanted the patents, there's nothing Google could've done. They need to set up a patent pool with their Android partners, and then start bidding together for other patents as well. This would probably be the most effective strategy that they can relatively quickly implement. As for buying RIM together with other companies, I suppose Google could spend a big part of their money to buy it, and then they'll sell the hardware division to Samsung or whoever, the other divisions to other companies, and keep only the patents for themselves. But they'll have to make the deals prior buying RIM, so they can make their money back later.
benfwirtz 15y ago
Guess it won't happen now, Google just bought Motorolla for (about) the same price they could have bought RIM: http://techcrunch.com/2011/08/15/breaking-google-buys-motorola-for-12-5-billion/ http://techcrunch.com/2011/08/15/breaking-google-buys-motoro...

12 points by BvS 15y ago

nextparadigms 15y ago

Yes, that's what I was immediately thinking too when I saw that. RIM is still quite expensive though, and unless they plan on turning RIM around and getting a strong foothold in enterprise with Android within like a year, then $12 billion seems too expensive for patents. This also reminds me what a mistake Google did when they didn't buy Palm. They could've paid only $1.2 billion for their huge mobile patent chest (probably about as big as RIM), their WebOS technology, which I'm sure they could've used, and also 1000 employees, where many of them were engineers. Palm would've been a total bargain for Google. With RIM, Google has 2 strategies: 1) Get them now by spending 1/3 of their cash, and immediately switch the company to Android. If they move it fast and do it right, they have the opportunity to make Android bigger in enterprise than iPhone will ever be. With RIM, they also have the opportunity to make a lot of money from hardware - maybe close to what Apple is making. The downside is some Android partners may not be too happy about this, but as long as they remain fair towards them and give them access to Android no later their their own RIM division, I don't think they'll mind it too much. They'll still want to use Android because Android is still the most popular smartphone platform they can use by far, right now. It's not much different than if Microsoft bought a PC manufacturer. What I'd love about it as a consumer, is that there would be a strong manufacturer, Google's no less, that will make great stock Android smartphones. 2) They can let RIM collapse, and buy them in 2013 for much less just for their patents, maybe for 2-3 billions or so. Either way they have to take into account that others, like Microsoft might bid for them, too, although I'm not entirely sure Microsoft will buy them right now, after their partnership with Nokia. And at least Android has 50% market share, while WP7 has 1%, so Microsoft's other partners besides Nokia might leave them altogether. And then if Microsoft can't turn WP around with the fast declining RIM, and the even faster declining Nokia, they're gone from the mobile space, and they'll take both RIM and Nokia with them. Google buying RIM at its peak is one thing, Microsoft buying it when WP hasn't even become larger than WebOS, is quite another. Why would the others stick around for an OS that doesn't bring them any significant sales, and when Microsoft will play strong favorites with Nokia and of course RIM, which would be theirs?

astrodust 15y ago
I'm sure that Google could turn RIM into Google North and do quite well with the people alone. The patent portfolio and the technology wouldn't hurt either.

presty 15y ago

Google buying RIM would make the other Phone companies very unsettled

deleted 15y ago

[deleted]

rst 15y ago

The trick, strategically, would be arranging to do this without having the transaction turn into yet another bidding war --- which they'd be at risk of losing once again to a coalition of their adversaries (as with the Nortel patent auction). Perhaps they could arrange a coalition of their own, involving IBM, or one of the other phone manufacturers as the ones who would take over the actual phone business...

nextparadigms 15y ago
I was actually very surprised they didn't do this to begin with in the Nortel case, especially since the patents being bought would've helped all of them. The risk was simply too high for Google even if it was only Apple bidding against them, without all the others. Apple has twice as much cash as they do, and if Apple really wanted the patents, there's nothing Google could've done. They need to set up a patent pool with their Android partners, and then start bidding together for other patents as well. This would probably be the most effective strategy that they can relatively quickly implement. As for buying RIM together with other companies, I suppose Google could spend a big part of their money to buy it, and then they'll sell the hardware division to Samsung or whoever, the other divisions to other companies, and keep only the patents for themselves. But they'll have to make the deals prior buying RIM, so they can make their money back later.

benfwirtz 15y ago

Guess it won't happen now, Google just bought Motorolla for (about) the same price they could have bought RIM: http://techcrunch.com/2011/08/15/breaking-google-buys-motorola-for-12-5-billion/ http://techcrunch.com/2011/08/15/breaking-google-buys-motoro...