The $12.5 billion takeover of Motorola Mobility by Google is expected to intensity the tussle between Google and IT major Microsoft.

 

 

 

The deal will be considered as the Google’s efforts to strengthen the Android business. The deal will also enable Google  to compete with Microsoft and Nokia.

 

 

 

Main reasons for fueling the competition between Google and Microsoft:

 

–       Microsoft’s deal with Nokia will threaten Android marketshare

 

–       Nokia to phase out Symbian in the long term

 

–       There are rumours about Microsoft buying Nokia

 

–       Android increased its marketshare to 43.4 percent in Q2 2011 from 17.2 percent in Q2 2010

 

–       Symbian lost market share to 22.1 percent in Q2 2011 from 40.9 percent in Q2 2010

 

–       Microsoft OS lost marketshare to 1.6 percent in Q2 2011 from 4.9 percent in Q2 2010

 

–       Nokia lost market in phone business to 22.8 percent in Q2 2011 from 30.3 percent in Q2 2010

 

–       Motorola almost maintained phone marketshare to 2.4 percent in Q2 2011 from 2.5 percent in Q2 2010

 

–       Google will leverage Motorola deal to enter handset business

 

–       Google will strengthen Android through Motorola

 

Android media tablets have collectively taken 20 percent market share away from the iPad in the last 12 months, according to ABI Research.

 

 

 

Worldwide annual media tablet shipments are expected to top 120 million units in 2015. While not quite as strong as traditional PC or smartphone annual sales, media tablets are emerging from the shadow of non-handset mobile devices and rapidly coming into their own.

 

 

 

Google and Apple are the winners in the smartphone ecosystem. The combined share of iOS and Android in the smartphone operating system (OS) market doubled to nearly 62 percent in the second quarter of 2011, up from just over 31 percent in the corresponding period of 2010 (see Table 2). Gartner analysts observed that these two OSs have the usability that consumers enjoy, the apps that consumers feel they need, and increasingly a portfolio of services delivered by the platform owner as well.

 

Google’s rhetoric about supercharging” the Android ecosystem implies that Google plans to work extra closely with the Motorola team. This is a delicate balancing act for Google; any hint of favoritism or signs that Motorola is getting an unfair advantage, and other key Android vendors will not be pleased.

According to Ovum, this move brings Google significantly closer to  hypothesis of a managed device platform” where a vendor controls all aspects of a platform, including hardware, software, content and online services.

 

 

 

We may see Samsung, HTC, LG, Sony Ericsson and others reinvest in alternative mobile platforms, most likely Microsoft’s Windows Phone ecosystem, to keep Google honest.

 

 

 

The acquisition will significantly strengthen Google’s patent portfolio, an important move in light of ongoing patent litigation across the mobile industry, particularly litigation aimed at Android and its vendor partners.

 

 

 

Motorola has a strong patent portfolio and a long history of producing advanced devices and technologies, but has been struggling financially for a number of years, making it an attractive target.

 

By Baburajan K
[email protected]