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Google upped its bid for Motorola by $3B in one day to close deal

post #1 of 69
Thread Starter 
In order to secure its purchase of Motorola and the company's collection of patents, Google outbid itself by 33 percent, or $3 billion, in a single day to reach an agreement.

Google's aggressive strategy to acquire Motorola was revealed in filings made with the U.S. Securities and Exchange Commission this week. In detailing Google's bidding strategy, The Wall Street Journal noted that the extra $3 billion paid "underscores the pressure the search giant was under to beef up its patent portfolio and protect its promising Android smartphone franchise from a growing number of legal challenges."

Google initially offered $30 per share on Aug. 1, but Motorola rejected the offer and suggested a price of $43.50. Then on Aug. 9, Google offered $37 a share, while Motorola asked for $40.50.

On that same day, Google again upped its bid to $40 per share, increasing its standing offer by $10 per share in a single day. On Aug. 15, Motorola agreed to Google's offer, and a sale price of $12.5 billion was formally announced.

Google's massive bid increase came in spite of the fact that the search company was the only party in talks with Motorola. The maker of phones like the Droid Bionic and Atrix 4G, both of which compete with Apple's iPhone, opted to negotiate exclusively with Google.

According to the Journal, Motorola's board decided that talking only with Google would be advantageous, because a public auction wasn't expected to result in a higher price, while a failure to sell would be "highly detrimental" to the company.



Speaking out on the deal, Google Chief Executive Larry Page said in August that he feels "anticompetitive" patent litigation on the parts of Apple and Microsoft deemed the proposed purchase of Motorola necessary. The Google-Motorola deal must still be granted regulatory approval before it can be finalized.

The acquisition of Motorola gives Google some 17,000 issued and 7,500 filed patents, which some believe will give the search company more leverage in the lawsuit-saturated Android landscape. A number of those lawsuits are between Motorola and Apple, with each accusing the other of patent infringement.

Just days after the Google-Motorola deal was announced, Apple Chief Financial Officer Peter Oppenheimer commented on it with: "$12.5 billion is a lot of money." Apple, in its history, has not engaged in the type of blockbuster acquisitions taken on by Google, and none of Apple's purchases have crossed even a half-billion dollars.
post #2 of 69
Google sees it is in big trouble and made a desperate move to ward off or at least ease the tsunami of law suits coming its way. Time will tell if the money was well spent or a rash decision. The Droid OEMs may be getting the picture that they should unhitched their wagons from the google horse before any advantage a "free" OS offered them will soon be worthless.
post #3 of 69
So, they bought a loss-making also-ran that had already sold all truly valuable patents earlier for $12.5 billion to obtain the remaining patents (which several experts consider useless), just hours after a lot of public whining how the evil Apple and their accomplices destroyed free innoborrowvation for a fraction of the cost?

The more I digest it, the more the Brothers Rimm look like geniuses.

Now, if you report tomorrow, that the true story was really that they had Page on one and Brin on the other phone and they were outbidding each other... I'll buy it.
post #4 of 69
Quote:
Originally Posted by AppleInsider View Post

Speaking out on the deal, Google Chief Executive Larry Page said in August that he feels "anticompetitive" patent litigation on the parts of Apple and Microsoft deemed the proposed purchase of Motorola necessary.

"we're not evil, it's just that you guys are making us that way."

sure, larry, sure.
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post #5 of 69
What a waste of money.

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post #6 of 69
Makes you wonder what type of due diligence Google did for a $12.5 billion purchase. My guess is not much and they have little idea of the type or quality of patents they are getting.
post #7 of 69
Sounds extremely desperate and like Larry entered negotiations without any game plan or financial discipline. That's not leadership.

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post #8 of 69
Why did they up their offer so much on the same day? Seems very odd.
post #9 of 69
If they had bounced from 9B to 12B it would be a 33% increase. They went from 9.5 to 12.5 tho, which is 31.58%. Yes that's nitpicky of me and I'm comfortable w/that
post #10 of 69
Quote:
Originally Posted by AppleInsider View Post


Apple, in its history, has not engaged in the type of blockbuster acquisitions taken on by Google, and none of Apple's purchases have crossed even a half-billion dollars.

Apple contributed $2.6 Billion to the Nortel patent purchase. I think that's more than half a billion ;-)
post #11 of 69
Had Google said no, 37$ is our last offer, Motorola could of go and make the offer public, even if they did not think they could get better.

Google losing another bid would not have looked good... and it's one of the last large patent portfolio left. They might give Android free to HTC, Samsung, but it's not free if they got to pay royalties.

I would not dare accuse Apple of anything in here, simply stating facts that the patent model is deficient. If I were Apple, I would also sue anything that nearly looks like my products, if i had that much chances to win or settle. But since i am a consumer, i can only take the hit and fork up more money on products to pay those lawyers and royalties.
post #12 of 69
Quote:
Originally Posted by bsimpsen View Post

Apple contributed $2.6 Billion to the Nortel patent purchase. I think that's more than half a billion ;-)

By acquisition they mean buying a running company. They've purchased lots of items for more than the half billion AI is quoting. Acquisitions can be very tricky. Purchasing items on the other hand is pretty straight forward.
post #13 of 69
Am I the only one thinking that Apple should buy Yahoo, revamp it, and stick it to Google.
post #14 of 69
I think that if we could just impose a "read Florian Mueller's blog before commenting on anything related to Android" policy we could avoid wasting bandwidth commenting on AI "articles" about it.
post #15 of 69
"According to the Journal, Motorola's board decided that talking only with Google would be advantageous, because a public auction wasn't expected to result in a higher price, while a failure to sell would be "highly detrimental" to the company."

Hmmmm...

Let me get this straight.

1. MotoMobile only talks to Google.

2. Motomobile determines that it will be highly detrimental to the company if they don't sell.

3. Google still outbids itself by 33 1/3% even though it looks as if the cards are stacked in their favor.

Am I missing something?!
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post #16 of 69
FOR GOD'S SAKE, HEAVEN SAKE AND ALL OF YOU (YES, CAPITALS) Lets be clear....
Mr Page never bought Moto for the patents, its patents are mainly useless since they never were able to reinforce them.
Google bought Moto, BECAUSE Moto was beginning to sue every single droid manufacturer, and..., Google could not afford to have the development AND expansion of Android derailed by Moto, considering that Google has (had) not valid patents, or very little of its own, to defend it. Therefore to avoid any cataclysm Google bought Moto for only that reason. Mr Page is a cynic when referring to noncompetitive monopoly of Microsoft and Apple. Apple is NOT using any of the bought patents to litigate..., only their own IP.
Funny that many Android manufacturer are paying Microsoft royalties...... indeed !!
post #17 of 69
Quote:
Originally Posted by island hermit View Post

"According to the Journal, Motorola's board decided that talking only with Google would be advantageous, because a public auction wasn't expected to result in a higher price, while a failure to sell would be "highly detrimental" to the company."

Hmmmm...

Let me get this straight.

1. MotoMobile only talks to Google.

2. Motomobile determines that it will be highly detrimental to the company if they don't sell.

3. Google still outbids itself by 33 1/3% even though it looks as if the cards are stacked in their favor.

Am I missing something?!

Yes. MMI came to Google and said "buy us or we will destroy Android." Google said "um, ok" and made the offer that they thought was necessary to prevent Android's death. The SEC report was written after the fact in such a way as to head off MMI shareholder lawsuits about the sale.
post #18 of 69
Quote:
Originally Posted by jukes View Post

Yes. MMI came to Google and said "buy us or we will destroy Android." Google said "um, ok" and made the offer that they thought was necessary to prevent Android's death. The SEC report was written after the fact in such a way as to head off MMI shareholder lawsuits about the sale.

Source.
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post #19 of 69
Quote:
Originally Posted by tenzo View Post

Am I the only one thinking that Apple should buy Yahoo, revamp it, and stick to Google.

You mean "stick it to Google."

First, Apple would never buy Yahoo. They don't believe in wasting money like that. And, the desktop search business is not interesting to them. They have iAds, but we don't know how successful they are compared to others like Google's AdMob.

Second, my guess is that Apple believes Android will not be much of a competitor in the long run.

Still, you make a good point (I think) that Google is able to spend (or waste) money because of its position in desktop search. If that comes under attack, Google will sink fast.
post #20 of 69
Quote:
Originally Posted by island hermit View Post

Source.

FOSS patents
post #21 of 69
Quote:
Originally Posted by jukes View Post

FOSS patents

Oh give me a break.

This is an op-ed piece. Mueller has so many "possiblys" and "could haves" in that article that you can see it is a made up piece of bunk. I honestly wonder sometimes if Florian and Daniel are the same two people.

Apple is not afraid of the MotoMobile patents... even your man Florian said as much... so does that mean that Google is so stupid as to believe that they have to buy MotoMobile to save Android.

Threats my ass.

Show me a passage in the filing that uses the word "threat" and then I'll agree with you.

[on edit: Motomobile is such a small piece of the Android pie. Google had to worry about the reaction from the big guns, Samsung, HTC and LG, if they bought MMI. The MMI patnts weren't going to protect Google... Apple already proved that.]
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post #22 of 69
Quote:
Originally Posted by AppleGreen View Post

You mean "stick it to Google."

First, Apple would never buy Yahoo. They don't believe in wasting money like that. And, the desktop search business is not interesting to them. They have iAds, but we don't know how successful they are compared to others like Google's AdMob.

Second, my guess is that Apple believes Android will not be much of a competitor in the long run.

Still, you make a good point (I think) that Google is able to spend (or waste) money because of its position in desktop search. If that comes under attack, Google will sink fast.

But didn't Yahoo! move to Bing for search which makes an Apple purchase even more pointless?
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post #23 of 69
Quote:
Originally Posted by island hermit View Post

Threats my ass.

That might be the greatest sentence ever written.
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post #24 of 69
Quote:
Originally Posted by solipsism View Post

That might be the greatest sentence ever written.

Punctuation and I have not always been friends.
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post #25 of 69
GOOD JOB GOOGLE.

YOU'VE JUST REPLACED NOKIA
AS THE MOST
POPULAR
UN-PROFITABLE
UN-IMPORTANT
CRAPPIEST
MOBILE PLATFORM
IN THE WORLD






ANDROID is the new NOKIA

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post #26 of 69
Quote:
Originally Posted by dragon View Post

Why did they up their offer so much on the same day? Seems very odd.

This article (especially the headline) is oddly written. If I went to the car dealer and offered $3000 for used car and they said, no but but I'll take $4100 and I counter offered $4000, would I be "upping my bid by $1000 to close the deal?" Sure, but that's just called "negotiating" not "bidding against myself."
post #27 of 69
Quote:
Originally Posted by jukes View Post

FOSS patents

Interesting article. In the last paragraph is says "Google bought MMI to prevent the worst for Google's strategy, not to make things better for everyone else."

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post #28 of 69
I'm still uncertain if this is a disaster for Google or such a genius move we are missing the big picture.

I was reading that Motorola has well over three billion in cash which Google now gets and because of Motorola's past loses there are also massive tax benefits for Google. It reduces Google's tax bill by $1.7 billion in the year of purchase and $700 million every year after that up to 2019. So rather than $12.5 billion it will really cost less than $3 billion. That is still a lot of money but it is a lot less insane than it previously sounded.

There is also the theory that Google was only really bidding on Nortel to raise the price Apple would eventually pay. Hence the weird bids like pi billion.
post #29 of 69
Quote:
Originally Posted by island hermit View Post

Oh give me a break.

This is an op-ed piece.

Yup. And provides an entirely reasonable explanation about the structure of the SEC filing. Hence my reply to your "Am I missing something?!" post.

Quote:
Mueller has so many "possiblys" and "could haves" in that article that you can see it is a made up piece of bunk. I honestly wonder sometimes if Florian and Daniel are the same two people.

Apple is not afraid of the MotoMobile patents... even your man Florian said as much... so does that mean that Google is so stupid as to believe that they have to buy MotoMobile to save Android.

So did you read the post, or even skim through it?

Quote:
Threats my ass.

Show me a passage in the filing that uses the word "threat" and then I'll agree with you.



Quote:
[on edit: Motomobile is such a small piece of the Android pie. Google had to worry about the reaction from the big guns, Samsung, HTC and LG, if they bought MMI. The MMI patnts [sic] weren't going to protect Google... Apple already proved that.]

Again, try reading the "op-ed" piece.
post #30 of 69
Quote:
Originally Posted by dreyfus2 View Post

So, they bought a loss-making also-ran that had already sold all truly valuable patents earlier for $12.5 billion to obtain the remaining patents (which several experts consider useless), just hours after a lot of public whining how the evil Apple and their accomplices destroyed free innoborrowvation for a fraction of the cost?

The more I digest it, the more the Brothers Rimm look like geniuses.

Now, if you report tomorrow, that the true story was really that they had Page on one and Brin on the other phone and they were outbidding each other... I'll buy it.

Yep, I like the last suggestion. Neither knew it was the other they were bidding against. Of course that leaves the question which one won ?

That or when they won the conversation went like this ...
Auctioneer: "Ok Google wins the bid at $12.5 billion" (hammer bang noise)
Page: "Did you say BILLION?"
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post #31 of 69
Quote:
Originally Posted by AppleGreen View Post

You mean "stick it to Google."

First, Apple would never buy Yahoo. They don't believe in wasting money like that. And, the desktop search business is not interesting to them. They have iAds, but we don't know how successful they are compared to others like Google's AdMob.

Second, my guess is that Apple believes Android will not be much of a competitor in the long run.

Still, you make a good point (I think) that Google is able to spend (or waste) money because of its position in desktop search. If that comes under attack, Google will sink fast.

Post edited....."stick IT to Google"....
I really don't think they will buy Yahoo. But it is a very intriguing thought. No one has been able to bring down the beast that is Google but it may happen one day. If any company can/could, it may as well be Apple. Think safe search results only. No B.S. sites listed. No malware/virus sites listed. A safe internet environment which can also work on the windows side.
And besides, "Isearch" has a nice ring to it. (trademark) lol......
post #32 of 69
Quote:
Originally Posted by jukes View Post

Yup. And provides an entirely reasonable explanation about the structure of the SEC filing. Hence my reply to your "Am I missing something?!" post.

So did you read the post, or even skim through it?



Again, try reading the "op-ed" piece.

As I said, this is an op-ed piece that uses the word possibly one too many times. You said it's a "reasonable explanation" and that's about it, an explanation, one man's "opinion"... it doesn't have to be taken as the truth.

Apple is not afraid of the MMI patents. Google should have realized this. Google would have been better off letting MMI shop their portfolio around because the SEC sure as hell would not let the Rockstar consortium buy the patents and that was obvious from the alarm bells that were set off with just the Nortel purchase.

IMO it's stupid to think that Google could be threatened by MMI. If I had been Page I would have told MMI to fuck off and let them try to sell the patents to Apple or whoever and then let MMI know that Google would send $ billion dollars worth of lawyers after MMI the minute the patent sale was announced.

Jobs would have shoved the entire Motomobile organization up Sanjay's ass if he had tried to threaten Apple as you're suggesting Sanjay did to Google. What??!! Google is a wimp as well as completely stupid?!
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post #33 of 69
Quote:
Originally Posted by FriedLobster View Post

GOOD JOB GOOGLE.

YOU'VE JUST REPLACED NOKIA
AS THE MOST
POPULAR
UN-PROFITABLE
CRAPPIEST
MOBILE PLATFORM
IN THE WORLD






ANDROID is the new NOKIA

I noticed that nearly every post you made so far contributes absolutely nothing to the topic at hand, all the time while spouting hate and other BS about Google/Samsung/<Insert non-Apple company here>. Did Google had someone murder your entire family or something? Just curious. These kind of hate and anger are not normal, even for an extermely obsessed fanboy.

On topic, Google does seem desperate to obtain Moto's Mobility Division and avoiding a public auction. I still believe it's mainly for the patents. They missed out on the earlier Nortel patent sale to Microsoft/Apple consortium and would be at a significant disadvantage otherwise.
post #34 of 69
Quote:
Originally Posted by island hermit View Post

As I said, this is an op-ed piece that uses the word possibly one too many times. You said it's a "reasonable explanation" and that's about it, an explanation, one man's "opinion"... it doesn't have to be taken as the truth.

Apple is not afraid of the MMI patents. Google should have realized this. Google would have been better off letting MMI shop their portfolio around because the SEC sure as hell would not let the Rockstar consortium buy the patents and that was obvious from the alarm bells that were set off with just the Nortel purchase.

IMO it's stupid to think that Google could be threatened by MMI. If I had been Page I would have told MMI to fuck off and let them try to sell the patents to Apple or whoever and then let MMI know that Google would send $ billion dollars worth of lawyers after MMI the minute the patent sale was announced.

The patent threat wasn't against Google, it was against Android licensees like HTC that don't really have anything to fight back with. It also included the threat of settling with Apple and signing a license agreement with Microsoft and potentially shifting towards Windows phone production. Google's main competition is Microsoft, not Apple, so this is a big deal to them.

Quote:
Jobs would have shoved the entire Motomobile organization up Sanjay's ass if he had tried to threaten Apple as you're suggesting Sanjay did to Google. What??!! Google is a wimp as well as completely stupid?!

The preponderance of evidence is that Google is completely stupid at the management level, yes.
post #35 of 69
Quote:
Originally Posted by jukes View Post

Google's main competition is Microsoft, not Apple, so this is a big deal to them.

WP7 phone sales disagree w/you
post #36 of 69
Quote:
Originally Posted by jukes View Post

The patent threat wasn't against Google, it was against Android licensees like HTC that don't really have anything to fight back with. It also included the threat of settling with Apple and signing a license agreement with Microsoft and potentially shifting towards Windows phone production. Google's main competition is Microsoft, not Apple, so this is a big deal to them.

Which (as I stated earlier), in my mind, is absolutely assinine. MMI shifting towards MS?! Huh?! A company that is in trouble like Nokia shifting over to the 50:1 shot. Shit... they'd be dead before the first Win phone hit the street. So what if MMI goes after HTC and Samsung? How is that going to change the landscape any more than the purchase of MMI has changed the landscape. Mueller just doesn't make sense to me.

Quote:
The preponderance of evidence is that Google is completely stupid at the management level, yes.

There is the reason for the purchase... not threats.
________________

... and now a tip for you:

You read Mueller's piece and this is what you got out of it:

"Yes. MMI came to Google and said "buy us or we will destroy Android." Google said "um, ok" and made the offer that they thought was necessary to prevent Android's death. The SEC report was written after the fact in such a way as to head off MMI shareholder lawsuits about the sale."

At this point it wouldn't matter if I had read the piece or not (which I had, btw), you've already summarized your take on the piece and that is all I have to argue.... your take.

Using FOSS to support your argument is like me using one of Daniel's arguments to support my case... lots of fluff, not much substance. That's why I asked for a direct reference to these supposed threats.
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post #37 of 69
Quote:
Originally Posted by SSquirrel View Post

WP7 phone sales disagree w/you

I would have added... at this point... but I'm one of those people that believes that MS will rise from the grave.
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post #38 of 69
the anti-Google/Android/Anything non Apple on Apple sites is stronger than the anti-Apple on anything non Apple sites...well at least Google and Android as I'm not sure how Microsoft fanboys are or if they truly exist in such a capacity.
post #39 of 69
Quote:
Originally Posted by island hermit View Post

... and now a tip for you:

You read Mueller's piece and this is what you got out of it:

"Yes. MMI came to Google and said "buy us or we will destroy Android." Google said "um, ok" and made the offer that they thought was necessary to prevent Android's death. The SEC report was written after the fact in such a way as to head off MMI shareholder lawsuits about the sale."

At this point it wouldn't matter if I had read the piece or not (which I had, btw), you've already summarized your take on the piece and that is all I have to argue.... your take.

right

Quote:
Using FOSS to support your argument is like me using one of Daniel's arguments to support my case... lots of fluff, not much substance. That's why I asked for a direct reference to these supposed threats.

My experience is that FOSS is a step up from Daniel's fluff. It's speculation from an expert as opposed to gossip. Speculation none-the-less.
post #40 of 69
Quote:
Originally Posted by AbsoluteDesignz View Post

the anti-Google/Android/Anything non Apple on Apple sites is stronger than the anti-Apple on anything non Apple sites...well at least Google and Android as I'm not sure how Microsoft fanboys are or if they truly exist in such a capacity.

Apparently you haven't read the "Masochist me?" article over at Arstechnica today then. The anti-Apple in there is pretty ridiculous. I'm sure some will debate about Ars being an Apple or non-Apple site, but Apple coverage is only one of many things they do there.
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