Google has just announced that it is selling Motorola to Lenovo in a deal worth $2.9 billion. This will give the Chinese company a major presence in the U.S. phone market, and a bigger role in the tablet one.
Google CEO Larry Page said in a statement, “Lenovo has the expertise and track record to scale Motorola into a major player within the Android ecosystem. They have a lot of experience in hardware, and they have global reach.“
When Lenovo acquires Motorola, it will instantly become a significant factor in the U.S. phone market. And Motorola executives have made it clear they are working on Android tablets as well. Lenovo already makes a line of Android tablets, and Windows ones as well.
This will be a re-play of a previous deal: Lenovo became one of the world’s largest PC makers by purchasing IBM’s laptop and desktop divisions in 2005.
The Motorola brand will not be killed off. “Lenovo intends to keep Motorola’s distinct brand identity,” according to Page.
Patents Not Devices
Back in 2012, Google purchased Motorola at a time when the phone and tablet maker was struggling. While there were predictions that Google would use this acquisition to become more like Apple, as it owned both the Android OS and a team with long experience making mobile devices, in actuality Motorola has mostly been left to languish for the last several years.
Today’s statement from Google’s CEO indicates that the deal was made for Motorola’s patent portfolio, not to become a device maker itself. Google will hold on to virtually all of these patents.