Today’s big announcement (August 16, 2011), Google would like to buy Motorola Mobility Holdings. This gets Google squarely in the cell phone industry. The core of the strategy is to own a handset maker to run their Android system. On the surface, I understand why they would want more control over their system, but will also turn their current partners into direct rivals. Here are a few points about my thoughts on this move.
• Possibly changes Google’s image – As of now, Google is seen by the public and business as a friendly, cuddly company who has noble values and is all about being consumer centric. This move also reinforces their detractors who say that Google isn’t about working together, as their PR machine would like you to believe, but they want to own everything. Google, as with most tech companies, doesn’t have a good track record in dealing well with the human element. They assume everyone thinks like a techie, logical and unemotional. That is not how humans act. Often, we act illogical and if you don’t pay attention to our feelings, we’ll turn on you on a dime. Handset makers now have to decide how to deal with this new change in posture from Google. Before, they were all open arms inviting Google in. Now that Google is in, they want to put them out of business. As a business man, why would I want to promote a system on my phones that is created by someone who also makes the very handsets that I’m competing against? It’s like Pepsi offering to sell Diet Coke.
From a public point of view, this move could further increase the notion that Google is getting too big and controls too much of our lives. Kind of like Microsoft. The funny thing about all of this, is Google’s #1 enemy from the beginning is Microsoft. They view them as the “evil empire”, but now it seems Google is getting closer to the dark side and claiming that crown all to themselves. In America, we don’t like it when one company gets so powerful that we are all beholding to them, and them alone. We want choices and will fight to keep it that way.
• Confuses Google’s brand – Google has been on a path of doing everything for the last 4-5 years. This move definitely takes them beyond the core area of search and into being a manufacture of phones. Yes, I understand that being able to control a significant channel for search is desired, but what does making phones have to do with search? Google has invested into everything from cars to power plants. Again, what does manufacturing and producing kilowatts have to do with search? So, should we start calling them Google-rola? As Google ventures further away from search, their brand not only begins to erode, but becomes vulnerable to other up-starts with the singular vision and passion that Google had in 1998.
• Money can only cover a limited amount of missteps – One thing that wealth has done to Google is to allow it to make irresponsible business moves just because they can. They’ve become sloppy, cavalier, and undisciplined. One thing in business that often repeats itself is money can cover numerous mistakes without much of a consequence, yet. This leads to a lack of discipline. Eventually, this flaw does catch up with almost every company and the nature of economics takes over. You will run out of cash way before you run out of ill-conceived ideas and soon must pay for them. So far they’ve acted their age, a teenager with a VISA card. Eventually someone is going to have to pay the balance.
In my opinion, this move to buy a portion of Motorola may have a short term positive effect, but in the long run may start to erode their brand with the public and create mistrust amongst business partners (ala Microsoft). History has shown us that there is no giant who can not fall. No company is invulnerable.