In the last class we discussed about various reasons of Google buying Motorola Mobility for 12.5 billion dollars, I would like to identify key insights about this matter from different perspectives presented through online community.
When one can team up with the secondary competitors to drive the biggest competitor out of the sight, it is considered a reasonable move for anyone who is worrying about being defeated by the biggest enemy, especially when the enemy grows steadily.
Google made a clear statement acknowledging that "a hostile, organized campaign against Android by Microsoft, Oracle, Apple and other companies, waged through bogus patents". CPTN and the Rockstar bonding together to sue Android device manufacturers is not news. In the previous articles I talked about Apple suing over HTC for 10 patents. This time Google is finally taking the defensive action by acquiring Motorola Mobility, especially targeting at its patent portfolio. Google pointed out in the article about the group tried to impose a tax for any manufacturer that chooses Android as the operating system. This not only gives less incentive for the mobile device manufacturers to use Android, but gives Microsoft more opportunity to gain traction for its operating system.
Motorola has around 24,5000 patents. After losing its pi billion bid on Nortel, Google got worried about the whole Android system and did not give much thoughts on acquiring Motorola for $12.5 billions. Instead of paying for imposed taxes, Google would rather spend this amount of money just to protect their business. This is just like me never wanting to rent textbook, because those textbook rental services can make so much more in the long run just for one book. Maybe this isn't a perfect example, but I argue that Google's move is on the right direction but with the wrong bid.
I wonder why the success of Android system is threatening the other businesses? Because Android is too good to be true. It is free and open-sourced. It gives manufacturers no second thought on choosing an operating system for their devices. Thus, Android is owning the mobile operating system market and growing in a steady pace. For Microsoft, since they entered this mobile territory late, so they have so little market share that the network effect is kicking in by the success of Android. For Apple, they just detest any threat that will hinder their revenue.
However, is that the whole story?
Why is consumer preferring Android over Windows Phone? Is it simply because Android is free and open-source with the early emergence in the mobile market? Or is it because Microsoft cannot keep up with the game that they cannot impress consumers with their precious operating system? I've never used their phone, so I can't speak for Windows Phone user. But I know people tend to embrace open operating system with community care, just as why we have a liberal society here at USA.
My other different take on the same topic is in this video:
I don't really know if I agree with the fact that people choose Android because it's the "liberal" thing to do. While, yes, many software engineers and people in this business like the idea of sharing and openness, that doesn't necessarily mean they'll pick a crappy open source operating system over a good non-open source product. I think it's because Android is good AND it's open source. And why shouldn't people be able to choose operating systems that support their point of view? Companies are able to support political candidates that serve their interests. Consumers pick stores that align with their opinions. So why can't hardware companies choose operating systems based on their beliefs either?
ReplyDeleteI believe part of the reason Android is favored over Windows Phone is that Microsoft entered the market too late, much like how Nokia refused to let go of the Symbian system when the true smartphones arrived (Symbian S60 phones were also termed smartphones back then) and also subsequently came up with the MeeGo when people were crazy about iPhone. When the market is changing tides, it tends to continue with the trend for a while since it is the talk of the town. Both the deliverable and the timing needs to be right before a challenger starts a chance.
ReplyDeleteAnother reason is probably that Microsoft only recently failed with their older Windows Mobile, their reputation for making a good OS sank when their smartphones still operated like PDAs. With only a few years in between, it is difficult to build back the reputation. As for Google, they had nothing to lose with their brand name, if their first delivery of Android was good, it escalates to great, since there was nothing before people would be even more impressed.