What next for Motorola powered by Google?

Google has announced that it will buy Motorola for $12.6bn, a premium of over 63% on its share price, and with it sending a massive shockwave through the industry.

As the dust settles and the tech world ponders the announcement that Google is now a hardware manufacturer, we wonder what the mobile phone landscape will be like this time next year.

Will the $12.6bn deal really make that much of a difference to the industry or will it just be business as usual?

Google

If the deal gets the approvals from the relevant government bodies (there is no reason to think that it won't) Google has bought itself two things: patents and hardware. 

Firstly, the boring bit: with over 17,000 patents, Google is now "tooled up" and ready to fight any incoming patent war. The patent element is important because it will allow the company to protect its Android operating system over the coming years, be it on its own Motorola hardware, or that of HTC, LG, Samsung and more.

Google is already battling patent suits against the likes of Microsoft, Apple and Lodsys, paying out in a number of places to keep the Android ecosystem alive and well. So this will only serve to help its cause in the future. 

Buying that many patents isn't likely to stop the industry fighting however, and could even find Google walking into cases it wasn't previous involved in. Microsoft is suing Motorola, for example, and that means Google is now part of that. It's not something that's likely to scare the search giant though - remember, YouTube was being sued by Viacom when it bought the video sharing service. 

On the hardware front, Google has not only bought a phone and tablet manufacturer, but a set-top-box maker too.

When it comes to phones, it currently says that it isn't going to change the way Motorola operates or give it preferential treatment in the Nexus flagship programme over other manufacturers like Samsung, LG or HTC. 

But while that might be the case, there is nothing to stop Google developing a second Nexus brand that is equal to the flagship models.  

Onto the set-top-box side of the business: this is going to be of great importance to Google TV in the US. Expect to see the company's television platform get a big push in 2012, as it now has the ability to make the software, put it in some hardware, and then sell it through Motorola's distribution channels. Virgin Media, Sky and companies like ComCast should take note.  

Motorola

It's fair to say that, while Motorola has been doing better over the last two years compared to the previous two (it was one of the top dogs in 2006 with handsets like the RAZR), having Google as its new owner has been the best thing it could have ever wanted, and it is probably the best suitor for the company. 

Motorola will continue on the path it currently is. There is little sense, for example, in it now looking at Windows Phone 7 as an operating system - as previously rumoured. 

With Google on board, it is unlikely to change the design aspects or ethos at the company, especially as its new parent company isn't renowned for its hardware design - just look at the original G1 android handset. 

One crazy but not unbelievable idea is that ex-HTC Chief Technology Officer Horace Luke, who is currently enjoy a stint on the beach having left HTC in April, could be brought in at Google to head up design. It would be a massive coup for the search giant and give Motorola the boost that it needs on that front. 

What we are likely to see though is Motorola dumping Motoblur completely and the handsets will become vanilla Android with an easy upgrade path. While Google will want to claim that the OS is still open, expect Motorola handsets to get fresh Android updates before all rivals, if only because they will be pure Android experiences and therefore easy to upgrade. 

While that doesn't sound like much, it means that those who want to stay up to date on the upgrade path will most likely start to choose Motorola over devices from Samsung or HTC. 

It also means that Motorola will have direct "in the family" access to Google's software arm and what it is and isn't doing in the future. That's likely to be a massive advantage if the manufacturer can use the developments effectively over others.

Apple

In the short term, it will have very little effect on Apple. The Cupertino giant will continue to say that Android is for geeks and that iOS is the better operating system. It will no doubt be annoyed that Google now has considerably more patents than it has, but that shouldn't affect the company too much going forward. If the Google/Motorola deal is about patents, it's more about Google protecting itself rather than taking the fight to others. 

We might see Apple beef up its Apple TV division, however, turning it from a hobby/side-note (as it is now) to something more substantial. Apple has yet to really captialise on this market, focusing on the iPhone and the iPad, but if Google starts to make concrete moves into the TV space - something it has so far struggled to do with Google TV - then that could force a major ramping up on the Apple TV front. 

Microsoft

The Google/Motorola deal is likely to affect Microsoft in a number of ways come 2012. Firstly, while not confirmed, it's unlikely that Motorola will now create smartphones with Windows Phone 7 as the operating system. 

Likewise, the move might push other operators like Samsung, HTC and LG more towards the MS operating system in the hope that it's the only "open" operating system left. We say "open" because Microsoft is now the only one of the three (Apple, Google and, of course, Microsoft) that doesn't make phones itself. Although it currently has an "agreement" with Nokia, it doesn't own the Finnish company (yet) and that could be appealing to other phone makers who are worried that Google owning Motorola will give it an unfair advantage. 

HTC

Likely to be the company most affected by the news, HTC now has to decide what it is going to do in the future. Stick with Google and possibly be outplayed by Motorola? Shift more towards Microsoft and Windows Phone 7 and play the gauntlet with Nokia? Or start creating its own operating system... 

If any one of the Android supporting manufacturers is in a position to create its own operating system it's HTC. The Sense overlay is by far the most removed experience from Android, and while HTC has always said that it is happy to leave the boring stuff to Google, a move like this could make it change its mind. 

It's also worth pointing out that HTC is probably the only company to be able to pull something like this off with consumers - the majority of its users opt for HTC devices because they aren't like other Android devices.

That locked-in user base, combined with a strong following, might be enough for it to create something new. That's not likely to happen within the next year, but it could be something they are working on to protect themselves in the future. 

Samsung

Samsung has a number of things going for it that means, like Apple, it's not going to be affected as much as say HTC could be. Come summer 2012, it's likely to have strong Android and Windows Phone 7 offerings, with Bada not being totally forgotten. And it's likely to benefit from the patent support Google will now be able to offer, so we would expect more flagship devices and business as usual. 

LG 

Like Samsung, LG will most likely continue on the same path as it is now, continuing to strengthen its Optimus range for both Android and Windows Phone 7. 

Nokia

Shares are up at Nokia following the announcement, but that's because people see the Finnish company as the next takeover target rather than it actually doing anything specific to boost that stock increase. Come August 2012, Nokia will have a bevy of Windows Phone 7 smartphones on sale and be pushing the tied-in operating system hard around the world.

If other phone makers are swayed by the Google/Motorola deal enough to also push more efforts into Windows Phone 7, that might benefit Nokia in the long run as there be more WP7 users in the ecosystem to steal.

RIM

Busy moving its operating system from BB7 to QNX, RIM won't be affected by Motorola being owned by Google in the short term. Android has dented BlackBerry sales, but not because of Motorola specifically. Where things could get tricky is if Google tries to use its new acquisition to create the ultimate Google Apps business-powered handset, thereby challenging BlackBerry handsets directly. That's unlikely to happen in the next 12 months however. 

HP

There was no reason to think that Motorola was about to ask to licence webOS, but this move is certainly going to put an end to those rumours - even before they begin. HP is likely to continue on as is and continue to try to convince consumers that its OS and phones are the best ones out there. 

Carl Icahn

Having pushed for Motorola to spilt into two companies, Mr Icahn will be able to spend the next year on the beach enjoying watching the interest accumulate on his bank balance. Why? With a stack load of shares in Motorola Mobility, he is estimated to make $415m from the deal. 

Consumers

12 months down the line and the market place is likely to look the same. The fallout from the deal isn't going to make a huge impact from day one, but over time, will change the playing field. Whatever happens, we the consumers are likely to benefit from this development. 

The patent stuff is by the by on the consumer level, but better handsets from Motorola will mean others will have to work harder to impress us. Apple will continue to expand the iPhone and iPad world with new models, while Nokia and Microsoft will be doing everything it can to impress us with Windows Phone 7. 

The biggest company under threat? HTC. How it responds over the next 12 months will be crucial in how it grows and develops as a company. Or whether it sinks into oblivion as quickly as it has risen.

What do you think? Will the Google/Motorola deal mean the end of HTC? Let us know your thoughts in the comments below...

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