Google's Schmidt: We bought Motorola for more than just patents

Google (NASDAQ:GOOG) Chairman Eric Schmidt said the search giant's proposed $12.5 billion acquisition of Motorola Mobility (NYSE:MMI) is for more than just Motorola's patent portfolio--Google is interested in collaborating with Motorola on hardware.

Schmidt, an interview with's CEO Marc Benioff at the annual Dreamforce conference in San Francisco, said that the deal is aimed at acquiring products as well as patent protection for Google's Android ecosystem. "We did it for more than just patents," he said. "We actually believe that the Motorola team has some amazing products coming. ... We're excited to have the product line, to use the Motorola brand, the product architecture, the engineers."

He noted that Motorola produced the popular Razr phone and that Google is familiar with Motorola because of Motorola's extensive use of Android. "We like having at least one area where we can do integrated hardware," he added. 

One of Google's primary justifications for acquiring Motorola was Motorola's 17,000 patents, many of which relate to wireless standards and non-essential wireless patents, as well as 7,500 patent applications in progress. A number of companies, including Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT), have sued Android licensees for patent infringement, and some analysts said the deal would be a good way for Google to try and shield Android licensees.

Executives from Android licensees have praised the purchase as a way to protect Android. "This acquisition is more to enhance Google's patent portfolio, to support us, to protect us, so this is good news," HTC CEO Peter Chou told the Wall Street Journal last month.

"It is important for us to protect the Android ecosystem," Nikolaus Scheurer, head of product marketing at Sony Ericsson, told Reuters.

Nokia (NYSE:NOK) CEO Stephen Elop said after the deal was announced that Google's Motorola purchase should worry other Android handset makers. Analysts speculated that Google could use Motorola to pressure or crowd-out other Android licensees.

In the discussion, Schmidt expressed his displeasure with the current state of the patent system, and said that he would like to see patents crowd-sourced or at least have them approved in a more "systematic" way. Schmidt also praised former Apple CEO Steve Jobs for delivering "certainly the best performance of a CEO in 50 years."

For more:
- see this Forbes article
- see this Business Insider article
- see this CNET article

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