Google’s takeover of Motorola Mobility
The battle in the mobile industry takes an unexpected turn
Aug 20th 2011 | from the print edition
WHEN smartphones were still young and computing tablets not yet born, some analysts predicted that the market for mobile devices would sooner or later look much like that for personal computers (PCs): there would be a clear division of labour and intellectual property between makers of hardware and software; a dominant operating system would emerge; and Apple would again become a niche player.
If proof is still needed, Google’s takeover of Motorola Mobility is the strongest sign yet that this will not come to pass, at least in the near future. On the contrary, the mobile-device industry will bear a closer resemblance to its other parent: the market for old-fashioned, voice-only handsets.
Start with intellectual property. In contrast with PC makers, firms in the telecoms industry have long fought over patents. If such disputes are even more common over today’s mobile devices (see article), it is because they are exceedingly complex and based on intellectual property from many different industries.
Gaining control of Motorola’s big patent portfolio will provide Google with ammunition in the ongoing battle between mobile platforms. Android, Google’s operating system for smartphones and other devices, has taken the world by storm. Its global market share is approaching 50% (see chart). Yet Apple and Microsoft have found a way to slow down, and even benefit from Android’s advance: going after makers of smartphones running Android for patent infringements.