Google Enters China Via Lenovo While Counter Balancing Samsung
On January 29th, 2014, Mountain View based Google announced it would sell it’s Motorola Mobility unit to Chinese based Lenovo for $2.91 in cash and stock. The deal cuts across many spectrum including mobile OS, computing wars, and search. Here’s 12 talking points:
Source: Not sure, but not mine
- Google keeps most of the 17,000 patents which it purchased for $12.5B. This patent trove allows it to compete on Internet of Things (IoT), sensor analytical ecosystems, and other key mobile technologies.
- Google needs a counterweight to Samsung who’s been looking at swapping OS.
- Google now gains a China strategy.
- Google takes a 5.94% stake with a $750M investment in Lenovo
- Google has a less than 2% search market share in China as they pulled out in protest, but with Lenovo, they gain an ability to enter mobile search through Lenovo as a back door.
- Lenovo is a perfect mid and long-term competitor to Samsung
- Lenovo now has the key technology to launch into mobile and cut down the time to market by 3 to 5 years.
- Lenovo can build the end to end hardware platforms required for a full line of servers, laptops, tablets, and mobile devices.
- Lenovo gains a trusted partner on OS in Google Android and can plug into the ecosystem
- Microsoft continues to be isolated in market share and ecosystem and faces a distribution problem.
- Apple faces more pressure from Google through Lenovo and Samsung for OS operating share and from multiple price points.
- Dell faces more competition from Lenovo across all product lines given the acquisition of IBM’s mid range business.
The Bottom Line: Google Gains A Key Partner With Sale Of Motorola To Lenovo