Wednesday, January 29, 2014

Google sells Motorola to Lenovo for $3 billion, keeps most of patent treasure trove

Perhaps this explains why Samsung has been so willing to work with Google this week. Not only did Google and Samsung sign a patent cross-licensing deal, the Korean giant agreed to modifications to its future devices to remove some of its customizations. And boom, as the news on all that sank in, it was revealed on Wednesday that Lenovo had acquired Motorola Mobility from Google, via TechCrunch, for $3 billion.

While the deal still hasn't been announced officially, TechCrunch said it has confirmed it.

For those who do not recall, Google acquired Motorola Mobility in 2011 for $12.5 billion. Going even further back, Motorola Mobility was spun off from the original Motorola and was basically the mobile device arm. The other division created by the split was Motorola Solutions, which had been the Enterprise Mobility Solutions and Public Safety division of Motorola.

After purchasing it, Google rebranded it as Motorola: a Google company. Notably, Google also said that it made the purchase primarily for Motorola Mobility's patents. Google will maintain ownership of most of those patents, although Lenovo will receive 2,000 patent assets and the Motorola Mobility brand and trademark.

Google previously sold-off the cable box division of Motorola Mobility for $2.4 billion.

Motorola has been a source of nothing but red ink for Google. Last quarter alone, the division lost $248 million. The trend, as well, was downward: Motorola lost $192 million in the year-ago quarter. Lenovo, on the other hand, has been seeking a ready-made cell phone business.

Back in October it was rumored that Lenovo had submitted a bid for BlackBerry. Despite anything that BlackBerry might say, we believe it's a better bet to hitch one's aspirations to Android rather than BlackBerry OS.

How it works out for anyone is for the future to decide.

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