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    February 14, 2012

    European and U.S. regulators approve Google’s purchase of Motorola Mobility

    On Monday, U.S. and European regulators approved Google Inc’s purchase of Motorola Mobility Holdings Inc. for the price of $12.5 billion and have made it clear that they will be keeping a close watch on the search giant to ensure patents critical to the telecom industry would be licensed at fair prices. Reuters reports that this decision by the regulators was one of a number of approvals that underscored the scramble by technology companies to acquire big pools of patents.

    Google’s move to buy Motorola Mobility came shortly after it tried and failed to buy bankrupt Canadian company Nortel Networks’ abundance of patents that was approved by the U.S. Justice Department as an Apple Inc-led consortium purchase.  The patents includes Research in Motion Ltd, Microsoft Corp, EMC Corp, Ericsson and Sony Corp, which agreed to pay $4.5 billion for 6,000 patents and patent applications in July of last year.

    In August 2011, Google said that it would buy Motorola for its 17,000 patents and 7,500 patent applications, in order to compete with rivals such as Apple and defend itself and Android phone manufacturers in patent litigation. Antitrust enforcers on both sides of the Atlantic want to prevent companies from gouging rivals when they license patents which  is essential in ensuring that different competing firms’ communications devices work together.

    EU Competition Commissioner Joaquin Almunia explained that “This merger decision should not and will not mean that we are not concerned by the possibility that, once Google is the owner of this portfolio, Google can abuse these patents, linking some patents with its Android devices. This is our worry.”

    While the U.S. Justice Department said that it was reassured by both Microsoft’s and Apple’s public statements that they would not seek injunctions in filing infringement lawsuits based on the Nortel patents, Google’s commitments have been unclear and it is of great concern how Google may exercise its patents in the future.

    However, not everyone has granted their approval with regulators in China, Taiwan and Israel having  still not signed off on the Google purchase of Motorola. Concerns may be centred around the possibility that the purchase would give Google one of the mobile phone industry’s largest patent libraries, as well as hardware manufacturing operations that will allow it to develop its own line of smart phones.

    Google is already being sued for patent infringement by Oracle Corp, which is seeking up to $6 billion and has been under increasing regulatory scrutiny and the legal battles over patents between various technology and smartphone firms has prompted the European Commission to open an investigation into legal tactics used by Samsung Electronics against Apple and whether these breach EU antitrust rules.

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