How The Google-Motorola Deal Affects Microsoft

microsoft ballmer htcHTC CEO Peter Chou with Microsoft CEO Steve Ballmer. Are these guys going to get closer?

Photo: AP

How does Google’s decision to buy Motorola affect Microsoft?Frankly, it’s a cloudy picture right now. We think it’s a victory in the short term, but in the long run it could be very troubling.

Here are the wins and losses from the deal for Microsoft as we see it:

  • Win: Microsoft just forced its rival to spend $12.5 billion to buy a crappy hardware business.
  • Loss: Google just got a fat pile of patents to beat back Microsoft’s lawsuits against Android.
  • Win: Google just pissed off all of its partners in the hardware business. Microsoft had pissed everyone off with its Nokia deal, now those companies might be willing to work with Microsoft.
  • Loss: If Google did this because it doesn’t think the mobile business can work as a software only, or ad supported business, it is a big problem for Microsoft in the long run. If Google thinks it needs hardware to make money in mobile, then what will Microsoft do? It’s not making much money on Windows phones.
  • Win: Google is going to have a huge integration challenge on its hands. It is getting bloated, and it is going to be slowed down. There’s a slim chance it affects the search business, which would help Microsoft.

DON’T MISS: THE TRUTH ABOUT THE GOOGLE-MOTOROLA DEAL: Google Had To Do It–And It Could End Up Being A Disaster

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