The day Steve Jobs got really mad at Google: Could Motorola deal upset other old friends??
Google doesn't always do exactly what it says it is going to do, says the New York Times today. Should other mobile phone makers be nervous after that $12.5 billion Motorola deal?
Steven Levy in his book "In the Plex" tells how Google acquired Android, the mobile phone operating system, and began building a phone business that is now a giant.
Even after the Android buy, however, Google played down ideas of entering the phone business. Then in 2008 Steve Jobs of Apple went to Google HQ to inspect a prototype handset.
All very friendly, it seemed. Mr. Schmidt, at the time Google’s chairman, was an Apple board member - and Google was an important partner of Apple.
But when Mr. Jobs finally saw Google’s phone, Steven Levy writes, he was “furious” and “concluded he was a victim of deceit."(Deal Book points out Mr. Schmidt says he never misguided Mr. Jobs.)
That was then - this is now. Google’s $12.5 billion deal for Motorola Mobility, makers of Android phone handsets and set-top TV boxes, is being described in the main as a chance to get Motorola’s huge clutch of 17,000 patents — NOT as a way dominate the handset market.
During their conference call with the media, Google executives mentioned the value of Motorola’s patents 24 times .The handset business, says Deal Book, was "almost an afterthought."
Google’s focus on the patents does make a lot of sense. Many handset makers, including Samsung and HTC, use Google’s Android operating system.. These companies have invested billions in Android and helped make it more popular than Apple’s mobile operating system.
But - those handset makers will now have to compete against Google..
“Google can’t admit in public that what they intend to do is eventually make Android proprietary,” Tavis McCourt, an analyst at Morgan Keegan Equity Research., told Deal Book. Despite Google’s protestations, he believes that in two to three years Google could add special features to its own phones that are not available to its “partners.”
Android would remain as an “open” platform - but a special phone with bells and whistles "could still infuriate its current manufacturing partners," Deal Book points out.
Consumers, however, might benefit . A Google proprietary phone could compete better against the iPhone, which Apple has all along controlled completely.
Last month Google lost a bidding war to Apple and Microsoft for 6,000 patents from the bankrupt Nortel Networks, so the hunger for 17,000 Motorola patents is without doubt genuine.
But Google’s new chief executive, Larry Page, has long had a hankering for the mobile phone business, says Deal Book. He personally pursued the acquisition of Android and has been its biggest fan.
As Mr Levy put it in an interview , “He was the guy behind Android. Larry is a big ambitious guy; he will roll big dice.”