Google and Motorola Mobility

The wireless market trembles as Google announced a $12.5 billion acquisition of Motorola Mobility. Some people believe that the acquisition is just a way to remove some lawsuits off of the company's back. Meanwhile the rating agency, Standard & Poor's, has slammed Google with an unstable outlook saying the deal will make Google less balanced.

What it means for RIM

For RIM to withstand the competition that Google has in the works, it needs to make some changes in the managerial level. Better still, collaborating, or going under the umbrella of a large company such as Microsoft could help RIM to weather the storm that is coming its way.

Research in motion's secure messaging technology is a major tool for the company. However, failure to innovate may dilute RIM's competitive advantage in the future. Presently, RIM's secure messaging infrastructure does not work with Windows operating systems. The reverse should be the case, but for this to happen easily Microsoft would need to step in to the arena.

What it means for Microsoft, Samsung, and LG

Microsoft may plan to take the electronic device manufacturing war to Apple by acquiring RIM. Right now, Microsoft is staying busy with Kinect and XBOX 360. Other companies such as LG and Samsung may benefit should they acquired Research in Motion following the acquisition of Motorola Mobility by Google. Again, whichever company, they will definitely benefit from RIM's BlackBerry Enterprise Messaging infrastructure. Oracle and HP are two other companies that may benefit from acquiring RIM. The issue of nationality might pop up. Canada may not want to see RIM leave the country.

Our take

What is obvious is that Google is trying to jump into the Smartphone business. However, what is not certain is why Google is doing this. Some experts in the tech community suspect Google went for the acquisition to solidify its position as the number one search giant. Google makes billions of dollars in both partner sites and on its own websites. Since tens of millions of Americans check for information online while on the go from their mobile devices, it makes sense for Google to have a strong foothold in the mobile device market.

Google is spending over $12.5 billion dollar on Motorola mobility for strategic reasons. The deal will help reduce some legal expenses as well. Google sees Microsoft as very slowly losing size and market share. However, they know Microsoft has lots of cash. This cash may help Microsoft to come back strong by buying up firms, especially in the mobile market. For example, Research in Motion holds about 10,000 to 15,000 patents. Microsoft would benefit greatly from these patents. Also, RIM's Mobile device design and manufacturing business is one of the best in the world.

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-By Dominic

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