Can it be true that Google would spend 2 years of profits on buying Motorola? And do they want to emulate the Apple model of integrated software and hardware? The following article asks this question.
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It seems that Google tried the, "we will create the software and other companies will make the phones using our software" model. But this seemed to fail. Sure they always quote how many phones have the Android operating system running on it. But it is more like, a bunch of low end phones have Android and people accept having it. They don't seek out the phones like the iPhone with iOS. Sure there are some die hard techies that do this with the high end Android phones but this is a small hard core following similar to Linux lovers. The masses love the iPhone and will pay the entry fee for the best.
The article quoted asks if Google can create a euphoric desire for their phones like Apple does. Google is about stepping out of the picture, as in Google search. Very simplistic and unobtrusive. Why did Google succeed in search over the former leader Yahoo? Yahoo plastered an overwhelming amount of ads all over the search page and then the search engine logic did not typically bring the most likely search match that you would probably want to the top. I remember needing to dig 4 to 5 pages deep before finding the link I was truly interested in. Google decided that they would use a ranking system which would assure the most likely desired match to float to the top. This made Google and created a large tech company with loads of cash. Since then there has been very little that brings in the same level of income. Google maps may be the exception. You Tube was bought and Google has tried to make it generate cash flow. Lately they have ads that pop up at the bottom of the video, possibly overlaying the content itself. This always annoyed me with television where they would put an ad at the bottom of the screen during a show advertising some other show. So I don't see a track record with Google except they get loads of search revenue to play with on odd adventures. Android was another purchase back in 2005, with the loads of cash they have they can just buy the good stuff and not innovate new products which actually generate good cash flows and justify their existence. Apple buys companies but they are not core to their operations they are extra gravy to the amazing product developed internally. They don't just search for who is making cool stuff and buy them, they make cool stuff on their own and buy supplemental companies to augment new supporting features.
If Google believes they can buy their way into greatness, they might want to look at Microsoft. MS had/has a cash cow with Windows and the Office tools but most everything else they just buy ( Xbox is an unusual exception). Motorola is no godsend cellphone company. They have had many flops of phones with a few successes. Google will have their hands full to prove that they can actually integrate a hardware company into a software company and have them make amazing products as a whole. So far I have not seen a sign from past Google ventures which prove this ability.
1 comment:
Stitch, I was as surprised as anyone at this purchase. Indeed, many so called analysts said it was a pretty bad idea, or they just scratched their head about why.
I very much agree that Google was most innovative with their search engine that put them on the map, and did change the way and the things people can do with a search engine. I will also give them credit for making so many software tools for free and available, but I'm not a big fan of these online tools. They feel to me second rate, not the result of a company really trying to make the best!
And this is where I agree wholeheartedly with your analysis . Overall it seems like Google does buy their way into markets outside of their core search engine business without actually doing the grunt work up front to innovate.
The coming years will be interesting. What phone products will we see from the Motorola that Larry Page says will still be autonomous? It's hard to say, but fun to watch.
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