Google’s vendor ambitions go under DoJ spotlight

29 September 2011 | Guy Matthews


Google’s move to become a telephony equipment maker through the acquisition of Motorola Mobility Holdings has met with fresh scrutiny from US anti-monopoly regulators.

Both Motorola and Google are being pressed by the US Department of Justice for ‘additional information and documentary material’ about the $12.5bn deal, and have reported this development to the country’s Securities and Exchange Commission.

Regulatory bodies on both sides of the Atlantic have looked several times into Google’s business practices over the last few years, amid accusations that the search engine company is using its vast wealth and power to aggressively enter new markets at the expense of rivals.

Motorola and Google said they expect the deal to close once the added information has been supplied and examined, perhaps by the end of 2011 or the start of 2012.

Google, the developer of Android smartphone software, is interested in Motorola’s huge library of patented mobile telephony innovations, which it believes will allow it to develop its own range of phones to rival Apple’s leading status in the market. Motorola Mobility is at present an Android partner.

The deal, if completed, is not thought likely to endanger Android’s open access status, but may nevertheless cause other Android manufacturers like HTC, LG, Samsung, Sony Ericsson, Acer and Lenovo some disquiet.

Google has been showing interest in various dimensions of the telecoms market in the last few years. It is one of the main stakeholders in the trans-Pacific Unity Cable System, launched last year. It was recently outbid in its attempt to acquire the patent portfolio of equipment vendor Nortel, and may yet have other areas of the telecoms sector up its sleeve for future acquisitive moves, believe analysts.