Google’s surprise $12.5bn deal to acquire Motorola Mobility could raise tension between the company and its partners in the Android ecosystem, according to an analyst.
The likes of Samsung, HTC and Sony Ericsson have between them a large number of handsets running the Android operating system. Now that Google has brought Motorola’s handset business on board it is effectively in competition with them.
A number of frankly bizarre quotes have been released by Google which it claims shows support from partners for the deal.
"We welcome today’s news, which demonstrates Google’s deep commitment to defending Android, its partners, and the ecosystem," said J.K. Shin, president, Samsung, Mobile Communications Division.
"We welcome the news of today’s acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem," added Peter Chou, CEO, HTC.
"I welcome Google’s commitment to defending Android and its partners," claimed Bert Nordberg, president & CEO, Sony Ericsson, while Jong-Seok Park, president & CEO, LG Electronics Mobile Communications Company, echoed: "We welcome Google’s commitment to defending Android and its partners."
Not everyone seems convinced by these statements though: "The move raises concerns for the wider Android ecosystem as the acquisition means that Google will become a hardware vendor. With this, Google will move from the position of partner, to that of competitor to Android handset manufacturers, potentially placing significant strain on the Android ecosystem," said Ovum analyst Nick Dillon.
"If, for example, Google provides preferential access to the Android code to its own hardware division, this would place other vendors at a disadvantage and may lead them to question their commitment to the platform, potentially pushing some towards other platforms," Dillon added.
A number of analysts took to Twitter to offer their thoughts on the deal. Gartner’s Carolina Milanesi asked: "Google acquiring Moto poses some interesting questions for other partners. How will Samsung and HTC see the acquisition?"
"Samsung HTC LG SEMC might be unhappy about Google/Moto but not much they can do when their smartphones sales are so dependent on Android," she added.
Michael Gartenberg, a colleague of Milanesi’s at Gartner said: "No one has ever successfully licensed a platform *and* competed with licensees at the same time. Apple tried it (twice) as did Palm & Nokia."
"Google now has the resources to fundamentally change the mobile business the way they wanted to with Nexus one," he added. "Google now free to pursue the vision of how *they* see Android. see Sense, TouchWiz etc.
RedMonk co-founder James Governor said the deal was "as much to do with patents as hardware." He added that the Google Motorola deal offered, "a hat full of patents, a market defence against the coming Amazon tablets, and a stack play."
IDC analyst Matt Eastwood posed the question: "Who’s strategy will change more following #GoogleMoto? HP aggressively licenses WebOS? Microsoft ties knot w/ Nokia? Where’s that leave RIM?"
So what’s next for Google? Fred Huet, MD of telecoms and media consultancy Greenwich Consulting reckons a tablet to rival the iPad is on the way: "Google’s intention to dominate the mobile ecosystem – beyond software – has always been crystal clear. Following the acquisition, the market will likely see the development and launch of an iPad rival tablet device, as Google develops its own mobile computing products. Apple has demonstrated that to own the consumer you have to provide their device, which is an approach that Google will likely adopt, with a Google tablet device providing a mobile link into the cloud."
"The question everyone will be asking is how Google can turn this strategic advantage into a commercial success, and fast. Because in spite of Android’s stellar growth, when it comes to smartphones Apple still commands hearts and minds of consumers," Huet added. "Another question to consider is, following in the footsteps of the Microsoft-Nokia partnership, does the Google-Motorola deal point to mobile future made on alliances? And if so, who will Facebook buy?"