Question

Why did Google acquire Motorola Mobility? What benefits does the firm gain through the acquisition? What risks does the acquisition present?

Answer 1

Answer: Motorola mobility was acquired by Google in 2012 mainly for accessing the strong patent portfolio of the company. It is said that at that time Motorola mobility had a strong patent portfolio of over 20 000 patents related with mobile technology. This helped Google to further improve innovation inside the company without investing the time required for R&D. This move also allowed Google to get access to the consumer oriented product lines like mobile phones and cable modems and so on which Google did not have. Along with this the company also acquired the innovative human resources of the company and vast global infrastructure of Motorola Mobility. This acquisition therefore provided all these benefits to Google. This acquisition also resulted in two types of risks. Firstly it created a challenge to merge two different types of organizational cultures. Cultural mismatch could result in the failure of the acquisition. Secondly Google acquired assets and business lines that did not matched it core competencies and diluted its focus.