This week has seen one of the biggest tech stories of the year so far, as Google decided to sell Motorola Mobility to Beijing-based Lenovo, at a loss of almost $10bn, after a mere year and a half after making their initial purchase.
It was a move that seemed to perplex a number of commentators, as after the successful launch of two fondly reviewed smartphones in the Moto G and X it would seem strange that Google would take such a huge hit on their initial investment.
As the fallout from the deal clears it is becoming clear that Google had a plan behind the whole deal and they may be getting benefits out of the deal that cannot be drawn up on a balance sheet.
The reason for this is because more and more details are being released about just what was sold to Lenovo for the princely sum of $2.91 billion and more importantly, what was left to Google.
It is important to note that in today’s world of patent war after patent war the fact Google took Motorola’s 17,000-strong patent portfolio should not be overlooked, especially when considering that part of this portfolio may cover the work done by Motorola’s Advanced Technology and Projects group, which will now merge into Google’s Android team.
Much like a certain brand of tinned wood preservative the Advanced Technology and Projects group do pretty much what it says on the tin, as it’s main responsibility include looking out for the next big thing.
Probably the most publicised and well known project that is probably under lock and key in some deep dark dungeon is something that works under the format laid out by the ambitious Phonebloks concept last year.
This was titled Project Ara when Motorola took the concept on and as it fell under the work of the Advanced Technology and Projects Group Google will now have sole rights to continue the project.
For those of you that didn’t get caught up in the buzz in this concept last year Project Ara is the name of the phone that users could build themselves, by buying aspects of the phone to suit them. Put simply it’s a modular phone, put super simply it is a lego phone that can be customised with the moving of a few blocks.
The implications of this are two-fold. Firstly it may mean that Google’s push to create their own hardware to house the Android operating system may not die with this sale.
Secondly it means that Project Ara has surfaced into the media once again, which is a huge positive as it’s something that has a lot of people excited and the longer it stays out of the public eye the more it feels like realism will catch-up and the finished project will never see the light of day.
When putting together this months e-mag (which you can download for free here) I placed Google in the month’s ‘not’ category for the very reason they accepted such a huge loss on the short changing of hands of Motorola. Now while the developments that show what Google will keep from Motorola go some way in explaining why they were happy to lose so much on their initial investment it still feels like Google will have a long way to go to justify losing $10bn on a business investment in around 20 months.