Lenovo's acquisition of Motorola Mobility smartphone business
On January 30, 2014, Motorola was acquired by Lenovo from Google, for $2.91
billion. This deal obviously brings in huge losses for Google as the company purchased Motorola for $12.5 billion around two years ago. Motorola's acquisition has been the biggest in Google's history. The company hoped that it will get the benefits from Motorola's patents. It hoped to avoid and be saved from the patent infringement lawsuits that it faces from the companies like Microsoft, Apple and Nokia. However, the company's hopes were shattered as the patents turned out to be worthless since they were basic essential patents which gave Google very little bargaining power. With the acquisition of Motorola, Google was clear that it just wanted to use the patents and not the handset business, as it did not want its vendors to compete directly with Motorola's. That's why the company kept Motorola isolated ensuring that it doesn't get unfair advantage from new Android features and releases.
But even the patents proved worthless, so there was no point that the company keep on holding Motorola. Also, this will give Google some breathing space from the regulators worldwide. So, the company instead sold the business to Lenovo.
As far as Motorola is concerned, this deal brings both positives and negatives for the
company. The biggest loss is that the company will now get deprived of the way of working of Google. Google probably did not sell off the R&D department which was working on products like smart tattoos, modular phone and smart pills. Motorola will be deprived of such innovations. On the other hand, the company will benefit from the acquisition by Lenovo. Lenovo has a huge market for mobile phones also in many high growing countries. Motorola will also benefit from...