Google to sell Motorola to Lenovo for $2.91B - FierceWireless

Google to sell Motorola to Lenovo for $2.91B - FierceWireless:

This is a pretty good take on the strategic transaction that Google has entered into with Lenovo.

The headlines will be very misleading related to the Motorola Wireless deal that Google just made for selling the handset division (hardware) to Lenovo. People will look at the almost $12.4B deal where Google bought some 17,000 and the Motorola wireless division that comes with it in May of 2012. and say that Google gooped up on this transaction. (Somewhat reminiscent of the Skype deals where Microsoft ended up with the technology at a small price compared to what eBay paid a few years earlier.)

This is a very smart deal by Google. Google is apparently keeping all of the software patents. The licensing (cross-licensing) agreements will probably give Google freedom to do whatever they want in the space. It takes them out of the hardware business, which made handset makers nervous (as an unfair competition with the bundle of handsets with Android OS).

When Google bought Motorola Mobility as a defensive maneuver. The problem is that Google's "free" operating system and products tromp on thousands and thousands of patents (and copyrights). So they needed the patent portfolio to fight the patent war in computing and mobility. (Just as Microsoft needed the AOL patents.) Steve Jobs and Apple have been very irritated with Google giving away (their) technology; but it is a little more complicated to sue and make money from a product being sold for $0.00 per unit.

Even though Google gives many of its products way for "free", it does make quite a lot of money, primarily from advertising. About 70% of Google's stock value is attributable to its advertising (about half PC and half mobile). Google now is at a market cap of $380B bringing it up quickly onto size of the two largest market cap companies in the world Apple ($450B) and ExxonMobil ($411B) as of Jan 30 2014.

So now Google has the patent protection they had to have, and they have sold it too. Beautiful. Now they can move into the offensive position in the patent wars. This is a game of Risk, but with multiple dimensions like 3-level chess. There is what you see above the board, but what is below the board -- where the patent portfolios live -- is where the armies are being amassed.

Make no doubt, small players will be crushed. Blackberry and maybe even Nokia will likely be completely isolated. Orphaned.

This will give Samsung a little competition. Samsung dominates the cell phone market, especially among android phones. See add to Samsung Worries. Google can not afford to allow Samsung to get too big and too strong.

From Googles perspective, this is a work of motion art. Beautiful.

Other players, say Apple, may not appreciate the beauty of it so much.

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Anti-patent engineers a problem, says senior Google IP counsel - Blog - IAM Magazine

Anti-patent engineers a problem, says senior Google IP counsel - Blog - IAM Magazine:

Wow this is an interesting point related to the effect that Patent Trolls have on the invention and innovation process. Google spends an ever increasing amount of time and money in prevention and avoidance within the new product/invention pipeline.

Yuk!

This is like the doctor avoiding malpractice issues by exercising defensive medicine, but on steroids.  (Sorry about the pun!)

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Vringo Requests Court to Increase Royalty against Google + AOL

Vringo Requests Court to Increase Royalty Rate to Be Paid by Google, AOL | Fox Business: "Vringo Requests Court to Increase Royalty "

Ouch. The royalty rates on AdWords by Google & ads by AOL could really get expensive.

Google has kept a competitive advantage because of their bid-to-ad technology. That's where they have historically made most of their money.

The computation formula would be based on 20.9% of Googles adword revenue as the base. And 3.5% of that... That is only 0.7315%. So less than 1% of Google's AdWords. Still lots of millions.

This looks like it will start to get expensive for them and AOL to keep using the technology owned by Vringo. Huge winnings already in place but aiming for a 7% royalty going forward.

Wow. This could get to be interesting.

Keywords: patent, Vringo, Google, AOL, AdWord, willful, infringe, court

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Apple-Samsung Case Muddies Future of Innovation - NYTimes.com

Apple-Samsung Case Muddies Future of Innovation - NYTimes.com:

Oh boy, this is gonna get ugly. Especially if you are in the habit of ripping off other companies technology.

Samsung, just got smacked down hard. A $1B verdict is just the beginning. Apple will of course, try to get treble damages for "willful" infringement of Apple's technology. But the $1B is only the beginning. On September 20, the hearing (resumes) related to an injunction of the sales of Samsung's offending products.

One would assume that the new Samsung line (Galaxy) does not infringe, but that too may soon become subject to tighter scrutiny.

Faced with injunctions or licensing Apples technology, that is the issue that will be confronting players in the market, including Google.

The war chests of patents are: Apple; Samsung (kinda); Google (now with Motorola wireless that they seem to have bought primarily for the patent portfolio); and Microsoft (now with a boat load -- $1B worth actually -- of patents from AOL).

Who else is there. RIMM? Palm's technology that went to HP is dwindling fast.

Of course, Samsung is appealing. But it's outlook is not, well, appealing. And this loss in the US, is going to seriously shape the face of the screen in there rest of the world.

Samsung is down 7% in Asian trading on Monday Aug. 27, 2012. Expect Apple to open up big on Hurricane Isaac Monday.


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AP: Yahoo, Facebook strike patent truce, ad alliance

The Associated Press: Yahoo, Facebook strike patent truce, ad alliance:
"Yahoo's legal assault had exposed Facebook's vulnerability to patent claims as it prepared to complete the biggest initial public offering of stock by an Internet company."

So Facebook had to go out and build its own war chest of patents: 750 here, 650 there. Now the law suit goes away and everybody's making nice.

"Facebook insulated itself by buying 750 patents from IBM Corp. for an undisclosed amount and spending $550 million to acquire another 650 patents that one of its biggest shareholders, Microsoft Corp., had purchased from AOL Inc. Armed with its own arsenal of intellectual property, Facebook signaled that it wasn't backing down and filed its own patent infringement lawsuit against Yahoo in April." That's 1400 patents from IBM and AOL (via MSFT).

For those people who used to think that anyone could duplicate Facebook; that's going to now require some rethinking. Plus, if everyone you know (and a whole lot of "friends" who you don't really know) are on Facebook, there's really no easy way to switch. Unless, of course, you have become tired of your old friends and you wanna start over by looking for new ones:-)

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