Google selling Motorola Mobility to Lenovo for $2.9 billion

By , Jan 29, 2014

LenovoLockup_NEG_Color

Well this is an interesting turn of events. It appears that Google has decided to sell its Motorola Mobility arm to electronics giant Lenovo for $2.91 billion. The deal is said to include the entire Motorola division and some 10,000 of its 17,000 patents.

If the deal gets approved, Google would be selling Motorola for far less than the $12.5 billion it paid for it back in 2011. It looks like it’s holding on to some of Motorola’s IP though, and retaining licenses to its other patents, so it wouldn’t be a total loss…

Google CEO Larry Page confirmed the sale in a blog post:

“We’ve just signed an agreement to sell Motorola to Lenovo for $2.91 billion. As this is an important move for Android users everywhere, I wanted to explain why in detail.

We acquired Motorola in 2012 to help supercharge the Android ecosystem by creating a stronger patent portfolio for Google and great smartphones for users. Over the past 19 months, Dennis Woodside and the Motorola team have done a tremendous job reinventing the company. They’ve focused on building a smaller number of great (and great value) smartphones that consumers love. Both the Moto G and the Moto X are doing really well, and I’m very excited about the smartphone lineup for 2014. And on the intellectual property side, Motorola’s patents have helped create a level playing field, which is good news for all Android’s users and partners.

But the smartphone market is super competitive, and to thrive it helps to be all-in when it comes to making mobile devices. It’s why we believe that Motorola will be better served by Lenovo—which has a rapidly growing smartphone business and is the largest (and fastest-growing) PC manufacturer in the world. This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere. As a side note, this does not signal a larger shift for our other hardware efforts. The dynamics and maturity of the wearable and home markets, for example, are very different from that of the mobile industry. We’re excited by the opportunities to build amazing new products for users within these emerging ecosystems.

Lenovo has the expertise and track record to scale Motorola into a major player within the Android ecosystem. They have a lot of experience in hardware, and they have global reach. In addition, Lenovo intends to keep Motorola’s distinct brand identity—just as they did when they acquired ThinkPad from IBM in 2005. Google will retain the vast majority of Motorola’s patents, which we will continue to use to defend the entire Android ecosystem.

The deal has yet to be approved in the U.S. or China, and this usually takes time. So until then, it’s business as usual. I’m phenomenally impressed with everything the Motorola team has achieved and confident that with Lenovo as a partner, Motorola will build more and more great products for people everywhere.” 

When Google acquired Motorola, it said that it would “supercharge the Android ecosystem.” But in the 3 years since then, the purchase has yielded little fruit. In recent quarters, the Mobility division has even begun losing money—some $250 million in Q4.

On the flip side, Lenovo currently offers a selection of Android phones that have seen success in China and other parts of Asia, but little in the US. As a longtime electronics-maker, it’s unlikely it wants Motorola’s hardware. So is it after the name? The patents?

It’ll be interesting to see how this all unfolds.

What’s your take on all of this?

  • Share:
  • Follow:
  • AndroidDogHeatandSteelersFan

    every tech blog site posted this lol. well good thing google stripped patents from motorola after selling to lenovo.

    • Ted Forbes

      Yeah, we can figure out some of the most obvious reasons and some of the smaller reasons, but the real big reasons, I really wonder why?

      • AndroidDogHeatandSteelersFan

        same

  • Andres Osses

    Hello… First comment.

    • Jonathan Liu

      Not YouTube.

  • http://www.ifans.com/ Joe Rossignol

    It’s hard not to look at $12 billion (bought) and $2 billion (sold) as a bad thing, but if Lenovo is able to make Motorola Mobility successful then it’s still a win for Google because Android will be in the hands of more users and on better phones. What a run-on sentence. Good luck, Lenovo!

    • AndroidDogHeatandSteelersFan

      12B bought (motorola and their patents). 2.91B sold stripped of patents.

      • Ted Forbes

        Maybe, but it has come a long way fast and they are on the high rise, see my comment below.

    • Ted Forbes

      See my comment below.

  • Jerry

    Second paragraph: would’t is misspelled

  • Decio Arruda

    I hate Google.

    • Ted Forbes

      Why?

      • Decio Arruda

        They basically just ruined Motorola for their own benefit. I think it’ll be a while before we see another ground breaking Motorola phone.

  • Rowan09

    Man Google needs to spend some money on me, since they have so much to waste.

    • Eric

      “Google will retain the vast majority of Motorola’s patents, which we will continue to use to defend the entire Android ecosystem.

      • Rowan09

        It’s always a waste when you buy high and sell low, but if they can find that those 7000 patents which they own out of the 17,000 is worth $10 billion it’s their prerogative.

      • Ted Forbes

        Its not a waste and yes they still reserve the patents. These guys know what they are doing, their cash pile and stocks are growing fast soon to surpass Apple if Tim Cook don’t get his act together with more innovations and the next iPhone Google will be the number one company in the world. As of yesterday they will do this without making a single thing. See my comment below.

      • Rowan09

        Their stock price is already passed Apple but Apple is still $60 Billion more in market cap. Are you saying Google would be glad to pay $10 Billion for those 7000 patents? Lenovo owns most of the patents also because they own 10,000 of the 17,000. It’s a waste, they are just fixing a broken situation. Does it mean they are going broke no, but companies make mistakes and this is a correction.

      • Ted Forbes

        Correct.

    • Ted Forbes

      Lol! they are not wasting though.

  • Chetan

    Google never had an aim to make mobiles better. It made android just to have a good check on daily routine of people and finally use all the data to push you with more and more relevant ads. Whole business of google revolves around ads and thats the reason all(most) services are free.

    • Ted Forbes

      Yep, really that is one thing and there are some more downsides to Google’s intentions, but to be fair their are many nice things as well.

    • mav3rick

      Good services, users have choice tho.

  • Ted Forbes

    I believe Google have accomplished their purpose for the acquisition of Motorola Mobility and it would suit them best to liquidate the junk to someone else, whoever need or want it. This is smart, this is strategy, this is business.

    Google from the start have gained and saved much from the results of this purchase. Other than acquiring pattens and hardware information, preventing law suits, infringements and piracy to develop their own technology quickly and successfully produce their own smartphones they have saved perhaps tens and tens of billions of dollars and a lot of time and mistakes on trial and error, research and development by starting from the ground up.

    The old stuff is junk, they don’t need it any more, so they are dumping off on someone who needs it. What else to do with it any ways, they have already surpassed the information they are dumping off and they did it very quickly. This is smart, this is strategy, this is business.

    If only I was this smart.

    • Rowan09

      Where do you get your info that they saved tens of billions by acquiring Motorola? They pas $12billion so for them to make any money on the invest they have to make more than the purchase price.