Late last month, Chinese computer manufacturing giant Lenovo, whose U.S. headquarters are in Morrisville, announced that they would be acquiring Motorola Mobility from Google for $2.9 billion. Motorola’s smartphone unit had only been under the ownership of Google since May of 2012, when it was acquired for $12.5 billion. While Google is retaining the patents and much of the research and development arm of Mobility, it still represents a huge, ten figure loss from Google’s attempt at bringing smartphone manufacturing in house.
Perhaps part of the blame for Motorola’s lackluster performance in the last 18 months lies with how Google never added a Motorola phone or tablet to their unlocked Nexus offerings. Maybe it’s how Motorola already had one of the most maligned user experiences (and developer experiences) in mobile, and moving to stock Android with the Moto X and G didn’t change public perception quick enough. Maybe it’s just that Samsung and LG have the Android hardware market cornered.
At any rate, the first question raised by the latest move in this game of OEM hot potato is “What is Lenovo going to do differently than Google?”
Branding
As of now, Lenovo has announced that they will keep Motorola’s distinct brand identity. IBM had, arguably, a more distinct brand identity, but IBM Thinkpads were quickly moved to the Lenovo brand.
It’s hard to believe that the Motorola namesake will last much longer in the smartphone market. Lenovo’s brand carries substantial weight in computer technology, and it’s easy to see how they could stretch their existing product brands, like the Toughbook and Thinkpad (already used with tablets), into the mobile phone space.
Windows Phone 8
Microsoft’s mobile OS really has no chance of gaining market share above that of iOS or Android, but don’t be surprised it’s part of Lenovo’s strategy in this acquisition. They’re one of the top manufacturers of Windows 8 tablets and a major Microsoft partner. With internal teams already possessing development experience, there’s a strong possibility that we’ll see Motorola or Lenovo phones running Windows Phone 8 in the not too distant future.
Filling the gap left by Blackberry
It’s doubtful that any smartphone manufacturer would want their brand and Blackberry used in the same article. That being said, there’s a huge opportunity in the government and business sectors, left by the very public fall of the company formerly known as Research In Motion.
With Lenovo’s existing business technology messaging and the history of Toughbooks being the laptop of choice for military personnel, a play at being the next smartphone for secure business and government communications may be in their long term plans for Motorola. The only question is whether governments would trust encryption from a Chinese company.
What do you see coming from this acquisition? Let me know here in the comments or on Twitter: @blakecallens.
