Monday, February 13, 2012

Google gets DoJ, E.U. go-ahead for Motorola Mobility acquisition

It's a done deal, and we will now see how Google's hardware partners react to its reality. On Monday, Google and Motorola Mobility received approval for Google's acquisition of the smartphone maker to go forward, from both U.S. and E.U. regulators.

At the same time, these government entities said they would keep a watchful eye on the Internet giant to ensure that patents critical to the telecom industry would be licensed fairly.

Meanwhile, the DoJ also approved an Apple-led consortium's purchase of a treasure trove of patents from bankrupt Canadian company Nortel Networks, and approved Apple's purchase of patents formerly owned by Novell.

E.U. Competition Commissioner Joaquin Almunia told reporters in Brussels that, "This merger decision should not and will not mean that we are not concerned by the possibility that, once Google is the owner of this portfolio, Google can abuse these patents, linking some patents with its Android devices. This is our worry."

The DoJ said that it was reassured by Apple's and Microsoft's public statements that they would not seek injunctions in filing patent infringement lawsuits based on the Nortel patent, while adding that, "Google's commitments have been less clear. The division determined that the acquisition of the patents by Google did not substantially lessen competition, but how Google may exercise its patents in the future remains a significant concern."

Authorities in China, Taiwan and Israel have still not approved the Google purchase of Motorola Mobility. China, for one, has until March 20 to decide whether to approve the deal or instead begin a third phase of review.

When Google made its move to acquire Motorola Mobility in August of 2011, it said that the acquisition was primarily about the phone makers' patent cache, one that includes 17,000 patents and 7,500 patent applications, and it ensures it can defend itself and Android against patent litigation, primarily by Apple, but also by Microsoft.

This deal, along with those made by Apple and others, shows the importance of patents in today's marketplace. However, the Google acquistion of Motorola, should it be completed, also places a big question mark on the company's relationship with Samsung, HTC, and others.

Those Android OEMs must --- despite public statements to the contrary --- be concerned that Motorola will now have significant advantage with the Android platform. Google has assured OEMs that will not happen, but the proof will be in the pudding.

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