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Google exec reiterates Motorola purchase not just for patents - Page 2

post #41 of 109
Quote:
Originally Posted by addabox View Post

Hey, look! Over there! People I hate! Let's go over there and hang out and tell them about it! Ha ha I am certainly better than these people! I feel great! What do you mean, I'm fucking pathetic?

hey, look! over there! people who agree with me no matter what and will never question anything I do as long as I mindlessly follow everything this one company does and treat them like gods. ha ha. I belong. my personal opinion is an echo of a crowd and not allowed to be anything else,but hey, I'm awesome. what so you mean I'm a mindless drone without a single independent thought?

I can play too big guy.

also my RSS feed shows appleinsider often. for the past few years I've periodically read their articles but had no account so never replied to some misinformation. some great points. some random tech news. now I joined so I can participate in these discussions.

sorry if you only wish for hivemindedness.
post #42 of 109
Quote:
Originally Posted by jragosta View Post

This, of course, ignores the fact that the pre-iPhone Android looks absolutely nothing like the current (post-iPhone) Android. Clearly, the iPhone changed Android's direction immensely. ...

The thing that confuses most people, and it's a confusion that Google is happy to promote, is that there are 2 mobile operating systems called Android. There's the pre-iPhone Android, that was pretty much a Blackberry clone, and which never saw commercial release, and there's the post-iPhone Android that is just as obviously an iPhone clone. So, all the arguments that "Android was around before the iPhone was released," are entirely beside the point. Sure, the two Androids share some technical underpinnings, but they are two very different OSs that simply share the same name.

Google has shown time and time again that they have no respect for intellectual property, and, more generally, no respect for the law or even ethical behavior. This is a company that pours millions into lobbying, astroturfing and doublespeak blogging to shape public perception. But, anyone who can see above their disingenuous PR fog knows that they are essentially technology whores who will do anything for a dollar, including emptying the wallets of their "business partners" and sneaking out of the room after they've f#$&*d them.
post #43 of 109
Quote:
Originally Posted by AbsoluteDesignz View Post

hey, look! over there! people who agree with me no matter what and will never question anything I do as long as I mindlessly follow everything this one company does and treat them like gods. ha ha. I belong. my personal opinion is an echo of a crowd and not allowed to be anything else,but hey, I'm awesome. what so you mean I'm a mindless drone without a single independent thought?

I can play too big guy.

also my RSS feed shows appleinsider often. for the past few years I've periodically read their articles but had no account so never replied to some misinformation. some great points. some random tech news. now I joined so I can participate in these discussions.

sorry if you only wish for hivemindedness.

No, you can't play, "big guy", because you're not very bright. Otherwise you'd busy yourself with something more challenging that debating with people you manifestly consider fools.

So what's the problem? Can't hold your own with people you consider peers? Because you're just too fucking stupid, and require easy targets to make your "points"? Or is it that you're just too lazy to challenge yourself?
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post #44 of 109
Quote:
Originally Posted by addabox View Post

Funny, I would have thought there were less objectionable ways of getting a bit of news than hanging out with "ignorant fanboys," I mean, you did register to be able to let everyone know you think the discussion is worthless. I'm guessing you also actually watch Fox news while smirking and reminding yourself that your better than all that?

note: not all Apple fans are to be considered ignorant fanboys. some people just like Apple products. and I don't see how anyone can blame them. Apple easily has the best most desirable hardware on the market and depending on your tastes the top OSes.

the issue arises when people literally get upset that people can possibly enjoy non-Apple products. Lie about Windows 8 copying Apple's 2011 OS with design elements over 16 years old. Make up stories about thievery not realizing they are making apple look like punks if it's true and treat a man and a company like God and his kingdom.

Such irrational loyalty towards an entity that literally doesn't care about you is pathetic.

But anyways. Too many words wasted on you.
post #45 of 109
Quote:
Originally Posted by addabox View Post

No, you can't play, "big guy", because you're not very bright. Otherwise you'd busy yourself with something more challenging that debating with people you manifestly consider fools.

So what's the problem? Can't hold your own with people you consider peers? Because you're just too fucking stupid, and require easy targets to make your "points"? Or is it that you're just too lazy to challenge yourself?

somehow I think you aren't aware that you started with me.
post #46 of 109
Quote:
Originally Posted by ConradJoe View Post

"The tax benefits of the deal make what was a good deal into a great deal," said Robert Willens, a New York accounting and tax expert. He estimated that through the acquisition, Google can expect to reap $700 million a year in tax deductions from future profits each year through 2019. Google also will be able to immediately reduce its taxes by $1 billion due to Motorola Mobility's U.S. net operating loss, and by a further $700 million due to its foreign operating loss, he said."

VERY interesting. It seems that most of the "anal-a-cysts" missed that little detail...

Getting tax breaks by purchasing operations that lose money is a curious business model.
post #47 of 109
Quote:
Originally Posted by bsimpsen View Post

Getting tax breaks by purchasing operations that lose money is a curious business model.

Take a course in finance. Tax considerations are an important part of any business deal.

There are cases where the tax breaks are worth more than the purchase price. So even if you close the business down the day after buying it and sell the assets for scrap, you're still well ahead of the game.

More commonly, let's say a business selling price is $x. And let's say that the tax credit value is $y. Now, let's say that you believe the actual value is $z. As long as $z + $y is greater than $x, purchasing the company might make sense.

On the other side, if you purchase company's shares rather than assets, you sure has heck need to be concerned about taxes. If there's an unpaid tax bill, it becomes your liability.
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post #48 of 109
Quote:
Originally Posted by ConradJoe View Post

They just "root, root, root for the home team"...

I don't quite understand being a fan of a corporation, but I see it as the same sort of thing as Red Sox fans hating the Yankees.

You realize that the Red Sox and Yankees are also corporations, right?
post #49 of 109
Quote:
Originally Posted by addabox View Post

If the Motorola purchase proves to be a boat anchor it really will call into questions Google's basic business acumen. They already looked kind of silly when they lost out on the recent Novell/Nortel bidding war, seemingly by not taking it all that seriously.

No one questions Google's technical chops, but I wonder if they have the people in charge to make the smart decisions when it comes to these kind of strategic acquisitions.

Lack of parental control maybe when uncle Eric was out? I wonder how involved Schmidt was with this debacle and if this signals he is having to pick up the broken toys.
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Been using Apple since Apple ][ - Long on AAPL so biased
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post #50 of 109
"Adult supervision" definitely required.

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   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

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post #51 of 109
Quote:
Originally Posted by bsimpsen View Post

Getting tax breaks by purchasing operations that lose money is a curious business model.

It's just not curious, but dumb.
post #52 of 109
Quote:
Originally Posted by anantksundaram View Post

It's just not curious, but dumb.

No, it's not. There are plenty of examples where tax credits are an important part of an acquisition's value.

IGNORING tax issues when making an acquisition would be dumb.
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post #53 of 109
Quote:
Originally Posted by jragosta View Post

Tax considerations are an important part of any business deal.

Of course they are. But to suggest that the PV of reduced tax payments over a 10-year period in such a rapidly-moving, strategically important business for a cash-rich company - an acquisition about which the company's top management have addressed nothing but the strategic aspects - is what makes the deal worthwhile (as some fo the commentary implies) does not hold water.
post #54 of 109
Translation: "Please ignore everything our CEO told you."

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post #55 of 109
Quote:
Originally Posted by jragosta View Post

No, it's not. There are plenty of examples where tax credits are an important part of an acquisition's value.

IGNORING tax issues when making an acquisition would be dumb.

Yes, I agree.

But I doubt that it was terribly important in this particular instance (despite the fact that it's there, although I am skeptical of how much).
post #56 of 109
Quote:
Originally Posted by anthropic View Post

@AbsoluteDesignz this isn't a great site for comments, most come from rather uneducated fan boys. But then again most of the articles are also by ignorant fan boys, so just read it for the occasional actual news and don't let the comments get to you, it isn't worth the frustration.

Apple is to this site what Republicans are to FOX News.
Both provide an equal level of ignorant reporting and shameless bias.

It IS a great place for trolls to lurk and encourage one another! *GRIN*

Anyone who comes into a forum and immediately spouts the "ignorant fan boy" meme is all too worthy of the ephithet "troll". Nice try but you are in the wrong place at the wrong time with the wrong comment. And not even a pithey humorous or nicely barbed comment. Just a poor, mediocre sort of "meh" comment, a sort of tired, bitter, disillusioned comment sounding more like, "I have failed miserably in life and and now I have to go dribble my depressed ennui somewhere - ahhhhh! the AI fora!" So first, you get plopped in the ignore list, then...

Back on topic, Eric's comments sound like he is part of an effort to stave off some hard questions from the shareholders. This is the problem with going public - a large group of people who gave you their money now want to know why you are doing stupid things with it. Larry, Sergei and Eric are scrambling to justify what has been roundly described as a questionable purchase.
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post #57 of 109
Quote:
Originally Posted by AbsoluteDesignz View Post

such seething hate for no real reason from users here.

Wow. You OBVIOUSLY have never met actual seething hatred or seen it in action. This is amusement, head-shaking at what most of the entire tech world outside of Google has labelled at best a "meh" decision, and at worst a highly questionable purchase that could create some real issues for both Google and the Android platform.

But since you don't (apparently) have the tech or business chops to look at the decision logically and objectively, this is the result.

Those Androse-colored glasses you wear here are going to cause you to run into something hard and immoveable one of these days - take them off and see the world for what it is...
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post #58 of 109
For the past year I've been saying that MotoMobility would be a good purchase for Apple (not at 12.5 billion though) and for a year I've been told that Moto was a crap company on the way to oblivion... well, now I'm ready to believe the people who said that... but suddenly it seems that Moto has value to some people... what changed.

ps - I think the Google Moto deal was a bad investment
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post #59 of 109
Quote:
Originally Posted by GalaxyTab View Post

Let me guess what it'll be "Google stole teh multitouch!" (something Apple does not own) or "Android woz teh blackberry before iFone was shown!!!!!!!1one" (which is also bollocks because Android is software, not hardware. Software is scalable and able to run on many form factors/devices)

Silly Galaxy - you're in the wrong place! The rabid Android fans are all over here:

http://phandroid.com/
or here:
http://androidcommunity.com/forums/

If you hurry you will just catch the latest round of self-congratulations and ice cream sandwich send-up. Don't let us poor benighted Appleistas keep you from your fun!

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post #60 of 109
Quote:
Originally Posted by anantksundaram View Post

Of course they are. But to suggest that the PV of reduced tax payments over a 10-year period in such a rapidly-moving, strategically important business for a cash-rich company - an acquisition about which the company's top management have addressed nothing but the strategic aspects - is what makes the deal worthwhile (as some fo the commentary implies) does not hold water.

No one said that it was being purchased solely for tax value. And it has nothing to do with whether the company is cash rich or the market is moving quickly. It's simple math in determining how much they are willing to pay for the business.

When you buy something like this, you consider ALL the positives and all the negatives. They might break it down as:

Purchase price $12.9 B
Current value of tax breaks $3.0 B

Net price $9.9 B

Selling unwanted assets $3.0 B

Bottom line price for the parts we want $6.9 B

Then they decide if the parts they want are worth $6.9 B or not. THAT is the important number - and calculating the tax benefits is critical to arrive at that number.
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post #61 of 109
Quote:
Originally Posted by ConradJoe View Post

"The tax benefits of the deal make what was a good deal into a great deal," said Robert Willens, a New York accounting and tax expert. He estimated that through the acquisition, Google can expect to reap $700 million a year in tax deductions from future profits each year through 2019. Google also will be able to immediately reduce its taxes by $1 billion due to Motorola Mobility's U.S. net operating loss, and by a further $700 million due to its foreign operating loss, he said."

VERY interesting. It seems that most of the "anal-a-cysts" missed that little detail...

You look for any positive twist you can put on it. So yeah Google bought Moto for the tax breaks....
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post #62 of 109
Quote:
Originally Posted by jragosta View Post

That's missing the point. There is value in this deal - and people who jumped into making their comments without understanding everything are starting to look foolish. Do you really think Google plunked down $13 B on a whim?

The value falls into 3 areas:
- Tax benefits
- Value of patents and IP
- Value of operating division.

The first two are largely fixed. They are worth whatever they're worth - and Google doesn't have much control over that. What everyone is missing is the third one - they're not just buying patents and tax losses, they're buying an entire operating division - which thousands of employees, factories, products, assets, and so on. The key to the value of this deal is in maximizing the value of the operating division itself. One magazine has got it right:
http://www.mediapost.com/publication...art_aid=157475

As I said when this came out, I can picture Google breaking the division up:
- Unrelated businesses (walkie talkies and baby monitors) could be sold immediately. No need to keep them around. Since breaking a business up often unlocks hidden value, they may not even have to take a hit to do this
- Related businesses which have a hidden downside (mobile phone handsets). Google is smart enough to realize that competing with their Android customers carries risks - especially since Motorola wasn't competing all that effectively to start. Unless Google has some magic dust to make it more competitive (and their lack of hardware experience argues against this), this is a loser for them. Sell it off with a license to use the IP. I could picture RIM being interested, but perhaps Sony or some other company.
- Related non-cellphone businesses. This is where the real value is. Set-top boxes could be a HUGE winner for them. Entry into your living room. Given Google's overriding business plan to intrude itself into every element of your life and gather every piece of personal data about you that they can, this opportunity can not be ignored. Furthermore, it could easily be expanded. For example, wireless home phones could be upgraded to Android to become smart home phones. Google would now have access to every call you make except at work. They'd have a screen in front of you 18 hours a day (and 24 on weekends).

There's value here. The key will be watching for a Google announcement soon on selling off some of the unrelated businesses. You can bet that Google has a strategy to monetize this acquisition for far more than the $12.9 B they paid.

Especially given Google's tendency to dismantle pretty much every company they purchase, use the few bits they can and discard the rest. I can see the scenario you described playing out, much as it has previously. I just question how much value it will in fact bring them in the final analysis.
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post #63 of 109
Quote:
Originally Posted by jragosta View Post

No one said that it was being purchased solely for tax value. And it has nothing to do with whether the company is cash rich or the market is moving quickly. It's simple math in determining how much they are willing to pay for the business.

When you buy something like this, you consider ALL the positives and all the negatives. They might break it down as:

Purchase price $12.9 B
Current value of tax breaks $3.0 B

Net price $9.9 B

Selling unwanted assets $3.0 B

Bottom line price for the parts we want $6.9 B

Then they decide if the parts they want are worth $6.9 B or not. THAT is the important number - and calculating the tax benefits is critical to arrive at that number.

You forgot to add the cash, again...

... and, anantksundaram might be the wrong person with which to argue business... just saying.
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post #64 of 109
Quote:
Originally Posted by TNSF View Post

Or... Google made a huge mistake.

Huge.

And...Maybe they didn't.

http://www.forbes.com/sites/timworst...rola-mobility/
post #65 of 109
Quote:
Originally Posted by appleworm1960 View Post

And...Maybe they didn't.

http://www.forbes.com/sites/timworst...rola-mobility/

You do realize that this is an op ed piece and that this writer could be very wrong... as has been mentioned, there are several other aspects to be considered other than tax benefits.

... but, then again, you did say "maybe"...
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post #66 of 109
Quote:
Originally Posted by island hermit View Post

For the past year I've been saying that MotoMobility would be a good purchase for Apple (not at 12.5 billion though) and for a year I've been told that Moto was a crap company on the way to oblivion... well, now I'm ready to believe the people who said that... but suddenly it seems that Moto has value to some people... what changed.

ps - I think the Google Moto deal was a bad investment

The answer is looking at the companies that Apple acquires.

The Google acquisition (it has been argued) of Moto was seen and initially touted as a quasi-defensive purchase to acquire a body of patents as a defense against IP challenges. This by itself is a BAD reason to do the purchase. Some of the library is suitable for defense but most is not, but several accounts. So, then they rapidly shifted to "we are going to use Moto to make really nice handset devices, but won't directly compete with our Open Handset Alliance partners" (who all lined up and signed on the Google created "we love the deal and fully support Google's actions" - dotted line, see the postings showing the identicality of those statements *grin*). MotoMobility is an old-school handset maker with aging facilities and a lot of staff. Before they were spun off, their division was a drag on profitability. They have a very different corporate culture than Google - there will be huge clashes or mass defections. One saving grace as jragosta brought up is the settop unit - which is making some nice kit for the Rec Room TV. That may serve to promote and significantly improve the miserable Google TV effort.

But Google's Open Handset Alliance partners are all busy hedging their efforts against this move even as they line up to give a half-hearted thumbs-up to the purchase. They are beseiged on several fronts by legal challenges from Apple and Microsoft and now this happens. The Microsoft suits or settlements will mean that Android will not be "free" and as Google tightens down control of the handset experience, the major players like Samsung and HTC are going to be hedging their options rapidly.

Back to my main point. Apple seldom (I would say never, but I haven't reviewed their purchases thoroughly enough to be comfortable with that) does "defensive" purchases - they are always purchasing forward - picking up companies that are pushing the boundaries of existing technology into the future, or are producing something that plays well into existing plans for services that Apple wants to offer as a part of the whole ecosystem.

Google, for all of its purchases is functionally a one-trick pony desperately trying to diversify itself. That proprietary search algorithm is getting long in the tooth, and key former founders of Google (and others) are out there building the next great algorithm. This creates huge pressure on Google to expand it's products to create additional streams of revenue, beyond the search-supported ad base. Unfortunately Google touts itself as an engineering company and they have done a poor job (apparently) in addressing their deficit in staffing for actual product development and execution. The track record of their products speaks assertively to this failing.

Once Google uncloaked as competing for existing resources with Apple (and Microsoft), Apple has become wary of what Google is doing and they will strategize their purchases accordingly.
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post #67 of 109
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Originally Posted by addabox View Post

So you're someone who hangs out with babies to feel like a big kid? Nice.

Based on the registration dates of some of the posters, and the gaseous nature of their spit-up -- I suspect that we are experiencing an invasion of the sugarplum trolls
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post #68 of 109
Quote:
Originally Posted by AbsoluteDesignz View Post

hey, look! over there! people who agree with me no matter what and will never question anything I do as long as I mindlessly follow everything this one company does and treat them like gods. ha ha. I belong. my personal opinion is an echo of a crowd and not allowed to be anything else,but hey, I'm awesome. what so you mean I'm a mindless drone without a single independent thought?

I can play too big guy.

also my RSS feed shows appleinsider often. for the past few years I've periodically read their articles but had no account so never replied to some misinformation. some great points. some random tech news. now I joined so I can participate in these discussions.

sorry if you only wish for hivemindedness.

One of the reasons my finger hovers over the ignore button for you is the simple fact that you seem to insist on being that truly annoying individual in the room full of poeple that insists on saying" yeah-but..." all the time.

You know - the contrarian. The pessimist. The debunker, the doomsayer, the person who thinks that they are self-assigned realists among idealists. And the key there is "self-assigned" part.

And then when challenged on it, you drop into defensive mode and grow bitterly dismissive. So that everyone here are all "hiveminded", are "mindless drones" " following everything this one company does and treat them like gods".

There may be a couple here and there in these fora who are really enthusiastic followers of Apple, but there are a large number of us who have been in technology for a long time, and may, just may, know a thing or two about what's going on. So when someone bristles at your desultory dismissal of their opinion, they may be justified.

And now at last I fear I will place you on my ignore list - I went back and looked again over your commentaries in these threads and there is too much gravel to sift for too few nuggets worth keeping. Sorry.
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post #69 of 109
First of all Motorola has some good phones and they are more than competitive with the iPhone. Only a fanboy could deny that. The new Bionic (sept 8th) is going to be a great 4G dual core phone with great battery life.....

Apple makes great products, but so do other electronic manufactures.
post #70 of 109
Quote:
Originally Posted by fecklesstechguy View Post

The answer is looking at the companies that Apple acquires.


Back to my main point. Apple seldom (I would say never, but I haven't reviewed their purchases thoroughly enough to be comfortable with that) does "defensive" purchases - they are always purchasing forward - picking up companies that are pushing the boundaries of existing technology into the future, or are producing something that plays well into existing plans for services that Apple wants to offer as a part of the whole ecosystem.

um... just to let you know... a recent thing occurred... they paid $2.5 billion for something... Nortel patents... Nortel was actually a dead company... the only thing of value was the patents... bought for defensive purposes.

... but for Apple... MotoMobile could have been more... tricky, but more... and Apple could have truly used the tax breaks to its advantage...

[ on edit: I also think that Moto's patents were of more value to Apple than to Google ]
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post #71 of 109
Quote:
Originally Posted by fecklesstechguy View Post

Wow. You OBVIOUSLY have never met actual seething hatred or seen it in action. This is amusement, head-shaking at what most of the entire tech world outside of Google has labelled at best a "meh" decision, and at worst a highly questionable purchase that could create some real issues for both Google and the Android platform.

But since you don't (apparently) have the tech or business chops to look at the decision logically and objectively, this is the result.

Those Androse-colored glasses you wear here are going to cause you to run into something hard and immoveable one of these days - take them off and see the world for what it is...

you finished?

my comment that you opted to reply to was in regards to the immense hatred many on this site have for anything not Apple. Windows? Grrrr. Android? Grrrr. Larry Page? Grrrr. not indifference. but actually emotional responses. they literally care enough to "hate" anything not Apple. It exists. it is blatant and though it exists for all companies it is more prominent with Apple fans. Observable fact.
post #72 of 109
Quote:
Originally Posted by Dick Applebaum View Post

Based on the registration dates of some of the posters, and the gaseous nature of their spit-up -- I suspect that we are experiencing an invasion of the sugarplum trolls

Just don't ask me to burp any of them...
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post #73 of 109
Quote:
Originally Posted by fecklesstechguy View Post

Silly Galaxy - you're in the wrong place! The rabid Android fans are all over here:

http://phandroid.com/
or here:
http://androidcommunity.com/forums/

If you hurry you will just catch the latest round of self-congratulations and ice cream sandwich send-up. Don't let us poor benighted Appleistas keep you from your fun!


Android sites are predominantly pro-Android (duh) and hardly ever anti-Apple. You're likely to find criticism of Android on Android sites as well. This site however is pro-Apple and anti-anything else. openly so. Even resorting to crazy distortions of history to push their pro-Apple agenda (Windows using Metro is somehow copying Apple from 2011)

but anyways.
post #74 of 109
Quote:
Originally Posted by fecklesstechguy View Post

One of the reasons my finger hovers over the ignore button for you is the simple fact that you seem to insist on being that truly annoying individual in the room full of poeple that insists on saying" yeah-but..." all the time.

You know - the contrarian. The pessimist. The debunker, the doomsayer, the person who thinks that they are self-assigned realists among idealists. And the key there is "self-assigned" part.

And then when challenged on it, you drop into defensive mode and grow bitterly dismissive. So that everyone here are all "hiveminded", are "mindless drones" " following everything this one company does and treat them like gods".

There may be a couple here and there in these fora who are really enthusiastic followers of Apple, but there are a large number of us who have been in technology for a long time, and may, just may, know a thing or two about what's going on. So when someone bristles at your desultory dismissal of their opinion, they may be justified.

And now at last I fear I will place you on my ignore list - I went back and looked again over your commentaries in these threads and there is too much gravel to sift for too few nuggets worth keeping. Sorry.

funny how you remained entirely unaware of the fact that I was mocking him.

also..bye
post #75 of 109
Quote:
Originally Posted by jragosta View Post

That's missing the point. There is value in this deal - and people who jumped into making their comments without understanding everything are starting to look foolish. Do you really think Google plunked down $13 B on a whim?

Yes they did do it on whim. Google was desperate to make some kind of public splash on the patent front to make it look like they were doing something. All their other efforts have failed so far, so they jumped on Moto. Google is a company that acts on a whim so it shouldn't be a shock that this was also done on a whim.

Quote:
The value falls into 3 areas:
- Tax benefits
- Value of patents and IP
- Value of operating division.

Tax benefits are nice, but they are not a sure thing either. As Google hasn't really talked about them I don't expect them to be worth much.

The value of patents and IP are real, but grossly overstated by Google and the media. The majority of Moto's valuable patents are either already sold, already licensed or are necessary patents that are required to be licensed to others and cannot be used in patent litigation. Its the appearance of patent value that Google is after. In reality though there isn't much there in terms of a bargaining position for Google.

The value of the operating division is negative. Moto is just barely breaking even and is likely to start losing money and burning cash as their sales continue to decline. This means they will actually consume additional Google cash above and beyond the $12.5 billion price. In addition, there are no synergies between Moto and Google so there is no room for them to reduce operating expenses as would normally be done in an acquisition. Inheriting 29,000 Moto employees is going to be a huge drag on Google. Google has a very carefully nurtured culture and acquiring Moto and its very different culture could be like dropping a nuke on Google's culture and way of doing business. It is going to be a huge huge distraction for Google. And the whole "continue to operate as a separate division" does NOT mitigate this.

The reality is that Google has never done a large scale acquisition. They have no institutional knowledge on doing large integrations, running a hardware business or managing such a large workforce. Google made this acquisition in order to make a big show about patents. Its just a bunch of handing waving to get people's attention, but in reality it offers them very little.

This should not be a shock to anyone. The majority of Google's products and new ventures fail. They are used to this and its part of their culture. Now however I believe they have grown arrogant and are convinced that they can't loose, and this time they've gone a lot bigger than they should have. They have demonstrated incredible hubris and chose the Moto acquisition because they didn't want to cooperate with anyone else. They're like a child throwing a temper tantrum.

The final cost of this acquisition is going to be more than $12.5 billion once all the dust settles.
post #76 of 109
I don't think anyone knows where Google is going with this...ignoring the doomsayers and the utopiawishers averaging out the opinions in the middle is where this will probably lead.

Google is a multinational corporation and I don't trust them either way. As long as in the end great products and services come out of it I'm all for it.
post #77 of 109
Quote:
Originally Posted by jragosta View Post

You can bet that Google has a strategy to monetize this acquisition for far more than the $12.9 B they paid.

One could assume this is a valid assumption because if it isn't that's just sad.

Whether it's a successful strategy remains to be seen. Given the rumored rapidity of the deal one wonders just how much due diligence occurred. The advantage and disadvantage of having founder CEOs that wield significant power is that a company can be very agile.

Don't forget that corporations are driven by humans. One of which may have been feeling the pressure to decisively hit one out of the park to show he's got the chops for the top job after a public loss. You can turn a blind eye to a lot of dissenting data and get the entire management team into groupthink with a strong enough personality and desire to win.

I have the distinct impression that the strategy was "we need patents and this comes with a lot of extra stuff we can use to defray the cost and maybe even make some money...this is MUCH better than the Nortel deal". I'm sure Jha was stressing all the upsides while whacking them with the "if you don't buy we're going to sue other Android makers or even sell to Microsoft" stick.
post #78 of 109
Quote:
Originally Posted by digitalclips View Post

Lack of parental control maybe when uncle Eric was out? I wonder how involved Schmidt was with this debacle and if this signals he is having to pick up the broken toys.

Ha!

You reminded me of an old Apple joke of the 1980's -- maybe time to update it for the 21st century:


Question: What's the difference between Google and the Boy Scouts?

Answer: One of them has adult supervision!



Then, there's this from Monty Python's Holy Grail:

Question: Who's that?

Answer: I don't know -- but he must be a king!

Question: Why?

Answer: Because he's not covered with shit!

"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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post #79 of 109
Quote:
Originally Posted by TNSF View Post

Yes they did do it on whim. Google was desperate to make some kind of public splash on the patent front to make it look like they were doing something. All there other efforts have failed so far, so they jumped on Moto. Google is a company that acts on a whim so it shouldn't be a shock that this was also done on a whim.

Let's see your evidence that Google did it on a whim. That would create a massive shareholder class action suit. NO ONE throws away $13 B on a whim.

Quote:
Originally Posted by TNSF View Post

Tax benefits are nice, but they are not a sure thing either. As Google hasn't really talked about them I don't expect them to be worth much.

That's absurd. The tax benefits are about as much a sure thing as there is in the acquisition business. The numbers are well defined and you can be sure that Google knows exactly what they're worth. The only question is what Google's tax bracket will be in the next few years, but I'm sure they have a pretty good idea of that.

The fact that YOU don't know what they're worth doesn't make them worthless.

Quote:
Originally Posted by TNSF View Post

The value of patents and IP are real, but grossly overstated by Google and the media. The majority of Moto's valuable patents are either already sold, already licensed or are necessary patents that are required to be licensed to others and cannot be used in patent litigation. Its the appearance of patent value that Google is after. In reality though there isn't much there in terms of a bargaining position for Google.

Really? So you're a patent expert now? You know more about the value of the patents than the team of advisors who undoubtedly vetted this deal? I sure don't know what they're worth, either, but suggesting that google doesn't have any idea what they're worth is baloney.

Amazing arrogance.

Quote:
Originally Posted by TNSF View Post

The value of the operating division is negative. Moto is just barely breaking even and is likely to start losing money and burning cash as their sales continue to decline. This means they will actually consume addition Google cash above and beyond the $12.5 billion price. In addition, there are no synergies between Moto and Google so there is no room for them to reduce operating expenses as would normally be done in an acquisition. Inheriting 29,000 Moto employees is going to be a huge drag on Google. Google has a very carefully nurtured culture and acquiring Moto and its very different culture could be like dropping a nuke on Google's culture and way of doing business. It is going to be a huge huge distraction for Google. And the whole "continue to operate as a separate division" does NOT mitigate this.

Once again, you really should learn something about business before commenting.

First, tax losses does not mean that the company is consuming cash. In fact, it is not uncommon for a company to have tax losses and still generate cash. Second, you're ignoring the possibility (likelihood, in my opinion) for the operating division to be split up. There are parts that Google certainly won't want which can be sold. Finally, there is the fact that Google can add value to some portions of the division.

Quote:
Originally Posted by TNSF View Post

The final cost of this acquisition is going to be more than $12.5 billion once all the dust settles.

And you know this because.....?

What the heck gives people like you (who clearly don't even understand the most fundamental basics of business) the nerve to pretend that you know more about this deal than the (likely) dozens of expert advisors who evaluated all the data and reached a conclusion on the deal?
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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post #80 of 109
Quote:
Originally Posted by fecklesstechguy View Post

It IS a great place for trolls to lurk and encourage one another! *GRIN*

Anyone who comes into a forum and immediately spouts the "ignorant fan boy" meme is all too worthy of the ephithet "troll". Nice try but you are in the wrong place at the wrong time with the wrong comment. And not even a pithey humorous or nicely barbed comment. Just a poor, mediocre sort of "meh" comment, a sort of tired, bitter, disillusioned comment sounding more like, "I have failed miserably in life and and now I have to go dribble my depressed ennui somewhere - ahhhhh! the AI fora!" So first, you get plopped in the ignore list, then...

Back on topic, Eric's comments sound like he is part of an effort to stave off some hard questions from the shareholders. This is the problem with going public - a large group of people who gave you their money now want to know why you are doing stupid things with it. Larry, Sergei and Eric are scrambling to justify what has been roundly described as a questionable purchase.

+++ Nice post
"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
Reply
"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
Reply
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