Feeds

Hello Moto: Lenovo grabs Motorola biz for $3bn. But Google's KEEPING the patents

The Chinese are coming and let a 1,000 lawsuits bloom

The Essential Guide to IT Transformation

Lenovo has signed a deal to buy the loss-making Motorola Mobility smartphone manufacturer for $2.91bn, but a switched-on Google is keeping the patents owned by the firm it gobbled two years ago for $12.5bn.

"The acquisition of such an iconic brand, innovative product portfolio and incredibly talented global team will immediately make Lenovo a strong global competitor in smartphones," said Lenovo's CEO Yang Yuanqing. "We will immediately have the opportunity to become a strong global player in the fast-growing mobile space."

Beijing-headquartered Lenovo has made no secret of the fact that it would like to buy an established smartphone vendor in the US and European market. While Lenovo has been growing strongly in the Chinese domestic market, the company has little presence in the Western sector, which is largely sewn up between Apple and Samsung.

According to the latest data Lenovo is the fifth-largest smartphone seller in the world, with 4.5 per cent of the market. Another half a per cent increase would take it to the number three position, and another ten to second after overtaking Apple. That's not possible without getting serious presence in markets where people buy smartphones often and at a high price.

"As part of Lenovo, Motorola Mobility will have a rapid path to achieving our goal of reaching the next 100 million people with the mobile Internet," said Dennis Woodside, CEO of Motorola Mobility. "With the recent launches of Moto X and Moto G, we have tremendous momentum right now and Lenovo's hardware expertise and global reach will only help to accelerate this."

But while an established brand (who didn't have a RAZR ten years ago?) Motorola's mobile arm has been making losses for years, and the value of the company is now largely predicated on its patent portfolio. Motorola built the first commercial mobile phone back in 1972 and has amassed a large stash of intellectual property that Googorola is now using to try and get royalties from.

That legal jamboree looks set to continue. Under the terms of the deal Google keeps almost all of Motorola's intellectual property, although Lenovo will get a bundle of around 2,000 patents from the deal. It will also have the licensing rights to the remaining IP, and Google indicated that it was looking forward to adding a new Android adherent.

"Lenovo has the expertise and track record to scale Motorola Mobility into a major player within the Android ecosystem," said Larry Page. "This move will enable Google to devote our energy to driving innovation across the Android ecosystem, for the benefit of smartphone users everywhere." ®

Boost IT visibility and business value

More from The Register

next story
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Amazon says Hachette should lower ebook prices, pay authors more
Oh yeah ... and a 30% cut for Amazon to seal the deal
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Backing up Big Data
Solving backup challenges and “protect everything from everywhere,” as we move into the era of big data management and the adoption of BYOD.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.