Google announced yesterday that it will be selling Motorola Mobility to the Chinese PC company Lenovo for 2.9 billion dollars. This is a significant loss after Google purchased Motorola for $12.5 billion in May of 2012. The hope of the initial purchase was for Google to have a platform to introduce its Android OS onto homemade hardware. However, ever since the purchase Motorola has consistently lost money for the tech giant ever since the purchase a year and a half ago.
In Google’s blog post, CEO Larry Page said that “[T]he smartphone market is super competitive, and to thrive it helps to be all-in when it comes to making mobile devices, this move will enable Google to devote our energy to driving innovation across the Android ecosystem.” So while Google seems to be going all in with their Android OS, Lenovo is believes that buying up Motorola will be able to allow them to tap into the gigantic Chinese smartphone market and hoping that they will crack into Samsung and Apple’s market share. However, in the transaction, Google will be keeping its hands on most of the Motorola patents which was a lot of their motivation in the first place.
CEO Larry Page said that this sale would not impact Google’s other hardware efforts whatsoever, such as Google Glass.
All in all, despite the near 10 billion dollar loss, this is seemingly a win-win situation for Google and Lenovo in that Google was able to force Android onto the smartphone market, hold onto some critical patents, and Lenovo can break into the Chinese market.