Thursday, December 22, 2011

Why must Google buy Motorola? China!

It's undeniable the biggest reason why Google must buy Motorola is the big telecommunication related patent portfolio owned by the mobile phone maker. However, there is another reason why this deal is important to the growth of Google.

Android is free, period. Google does not make a dime from Android when a smartphone maker adopts its mobile OS. Google has said many times that it intends to make money back from Android from increased web search activities, which in turn brings profit to its web advertising business. It sounds great, except that Google search is not available in Mainland China. Yes, even if every single smartphone sold in China is powered by Android, Google will not make a single penny there. At the same times, it does not look like Google plans to change its Do No Evil strategy and allow China to censor its web search.

So, how can Google profit from the mobile market in China? How about making smartphones? Motorola has been doing business in China for a long long times. It is a well-known brand among Chinese. By making smartphones through Motorola, Google can earn cash from Android through a totally different strategy.

The more we look at the deal, the more we can appreciate the smartness of Google ... let's hope that they really do not plan to be evil!

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