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Google lost about ~$9 billion on Motorola (~$12 Billion acquisition and now a ~$3 billion sale). This happened in the span of 2 years. You could throw $100 over

by Oculus 13y ago

Google lost about ~$9 billion on Motorola (~$12 Billion acquisition and now a ~$3 billion sale). This happened in the span of 2 years. You could throw $100 over your shoulder every second for those two years and that still wouldn't amount to $9 billion. We're the patents really worth that much? Edit: To anyone who uses the recent news about Google being forced to pay a percentage of their AdWords revenue to a patent troll: couldn't you spend $9 billion on lobbying to end this whole disaster of a patent system forever?

loxs 13y ago
What happened is not exactly that: https://news.ycombinator.com/item?id=7147251 https://news.ycombinator.com/item?id=7147251
psbp 13y ago
$12 billion - $3 billion - ~$2 billion (motorola home) - $3 billion motorola cash - whatever tax incentives over the period of ownership. They made it out ok.
palebluedot 13y ago
That's not really true, though. Motorola Mobility had ~$3B in cash at the acquisition point, and Google immediately sold off the cable box unit to Arris for $2.35B. Add in the ~$3B from this sale, and we are now at a cost of ~$4B. And I believe there were several tax advantages for Google, so it wouldn't surprise me if this whole acquisition only cost around $1B or so (and they keep the patents).
- Oculus 13y ago
  Ok, not as bad as I originally calculated. If that money went to lobbying though, it'd be fair to argue that they'd be closer to solving the fundamental issues there are in patent laws vs. acquiring a portfolio of patents that are only a temp. fix.
  - aragot 13y ago
    Is there any study that shows the cost of lobbying (in the case of moving major ideas like patents)?
    - dublinben 13y ago
      Only after the fact. Successful lobbying has a very high return on investment, but it's also pretty risky.
  - 51Cards 13y ago
    Sadly one has to bring a gun to a duel, because if you are going to wait for gun lobbying to stop your duel, you're probably going to get shot in the meantime. Not that lobbying isn't good in the long run, but you still need protection right now.
shimon_e 13y ago
> At $12.5B, Motorola is Google’s largest acquisition to date. Google paid $40 / share in cash, but received ~$11 / share in cash and $8 / share in deferred tax assets. Thus the value ascribed to operations + patents was about $21 / share, or $6.3B, reflecting a multiple of ~0.5x sales and 12x EBITDA. Now adjusting this further for the $2.35B total consideration Google is expected to receive for the Motorola Home business, we get a purchase price of just under $4B for Motorola's handset business and patent portfolio (17K patents and 7.5K patent applications). http://www.zdnet.com/googles-motorola-purchase-was-it-worth-it-7000009356/ http://www.zdnet.com/googles-motorola-purchase-was-it-worth-...
DannyBee 13y ago
" couldn't you spend $9 billion on lobbying to end this whole disaster of a patent system forever?" No. It wouldn't even help. Can folks please get over the idea that just throwing X dollars into lobbying somehow will magically get them what they want from congress. Especially not when you have other tech giants on the other side.
- Oculus 13y ago
  Are there really tech giants that are totally ok with our current patent system? I was under the impression that no company was happy, just some (e.g. Intellectual Ventures backers) are making due with what they can.
  - sangnoir 13y ago
    Yes- those with large patent pools. IBM and Microsoft, chief amongst them.

by Oculus 13y ago

loxs 13y ago

What happened is not exactly that: https://news.ycombinator.com/item?id=7147251 https://news.ycombinator.com/item?id=7147251

psbp 13y ago

$12 billion - $3 billion - ~$2 billion (motorola home) - $3 billion motorola cash - whatever tax incentives over the period of ownership. They made it out ok.

palebluedot 13y ago

That's not really true, though. Motorola Mobility had ~$3B in cash at the acquisition point, and Google immediately sold off the cable box unit to Arris for $2.35B. Add in the ~$3B from this sale, and we are now at a cost of ~$4B. And I believe there were several tax advantages for Google, so it wouldn't surprise me if this whole acquisition only cost around $1B or so (and they keep the patents).

Oculus 13y ago
Ok, not as bad as I originally calculated. If that money went to lobbying though, it'd be fair to argue that they'd be closer to solving the fundamental issues there are in patent laws vs. acquiring a portfolio of patents that are only a temp. fix.
- aragot 13y ago
  Is there any study that shows the cost of lobbying (in the case of moving major ideas like patents)?
  - dublinben 13y ago
    Only after the fact. Successful lobbying has a very high return on investment, but it's also pretty risky.
- 51Cards 13y ago
  Sadly one has to bring a gun to a duel, because if you are going to wait for gun lobbying to stop your duel, you're probably going to get shot in the meantime. Not that lobbying isn't good in the long run, but you still need protection right now.

shimon_e 13y ago

> At $12.5B, Motorola is Google’s largest acquisition to date. Google paid $40 / share in cash, but received ~$11 / share in cash and $8 / share in deferred tax assets. Thus the value ascribed to operations + patents was about $21 / share, or $6.3B, reflecting a multiple of ~0.5x sales and 12x EBITDA. Now adjusting this further for the $2.35B total consideration Google is expected to receive for the Motorola Home business, we get a purchase price of just under $4B for Motorola's handset business and patent portfolio (17K patents and 7.5K patent applications). http://www.zdnet.com/googles-motorola-purchase-was-it-worth-it-7000009356/ http://www.zdnet.com/googles-motorola-purchase-was-it-worth-...

DannyBee 13y ago

" couldn't you spend $9 billion on lobbying to end this whole disaster of a patent system forever?" No. It wouldn't even help. Can folks please get over the idea that just throwing X dollars into lobbying somehow will magically get them what they want from congress. Especially not when you have other tech giants on the other side.

Oculus 13y ago
Are there really tech giants that are totally ok with our current patent system? I was under the impression that no company was happy, just some (e.g. Intellectual Ventures backers) are making due with what they can.
- sangnoir 13y ago
  Yes- those with large patent pools. IBM and Microsoft, chief amongst them.