Google’s recently closed acquisition of Motorola Mobility marked the end of Sanjay Jha’s leadership at the handset company as Google announced Dennis Woodside would take over the helm of Motorola. The move comes as Google gained final approval of its $12.5 billion acquisition from Chinese regulators.
Brought on in mid-2008 to turn around a sinking ship that had become to reliant on past Razr-based success, Jha was tasked with advancing Motorola’s position in the mobile space that had begun to feel pressure from original equipment manufacturers that had quickly jumped on board the smartphone wagon, a surge Motorola initially led with its Windows-powered Q device. Jha had previously served as COO at Qualcomm, which caused many analysts at the time to question his decision to join a sinking Motorola.
Jha steered Motorola through an eventual separation of its infrastructure and handset division, as well as closer ties with Google to support its aggressive smartphone plans. That partnership eventually led to Google’s $12.5 billion acquisition of Motorola that was announced last August.
“I would like to thank him for his efforts and am tremendously pleased that he will be working to ensure a smooth transition as long-time Googler Dennis Woodside takes over as CEO of Motorola Mobility,” Google CEO Larry Page said about Jha in a blog post.
Woodside is a veteran at Google, having worked on building the company’s business in the Middle East, Africa, Eastern Europe and Russia. More recently Woodside was president of the Americas region for the company.
Analysts noted the deal places a new set of responsibilities onto Google in that it will now have to manage the supply side challenges embedded in device manufacturing.
“For the first time, Google is now in the mobile phone manufacturing business as well as in search and cloud services,” noted Carl Howe, research VP at Yankee Group. “As such, Google will now have to start actively striking component deals, managing its supply chain, and interacting with carriers and retail distributors. While it may be up to the challenge, I think Google is about to discover what makes the hardware business hard.”
The NPD Group recently noted that Motorola was the No. 4 handset manufacturer in the United States during the first quarter with approximately 10% market share. The same report noted that Google’s Android operating system was the top-selling OS during the quarter with 61% market share.
Worldwide, Canaccord Genuity reported that Motorola had just 2.3% of handset sales during the first quarter putting it at No. 8 in market share. The firm noted that Motorola enjoyed 4.5% of the market as recently as 2009, when it was No. 5 in sales.
Google’s alliance with Motorola should spell good news for wireless carriers that have been searching for a strong alternative in the market place against Apple’s subsidy heavy iPhone. Most Android-powered devices require substantially less subsidy to sell at consumer-friendly price points than the iPhone, which has seen its strong consumer demand pinch the bottom line of carrier results. It is hoped that by having Motorola in house, Google will be able to further integrate its services to compete with Apple’s tight ecosystem.
However, Google will also be challenged in that it will not want to anger its numerous OEM partners that currently provide dozens of smartphones running the Android OS. Google seems to be keeping this challenge in mind with its close relationship with Samsung to produce its Nexus device that is seen as having the most “pure” version of the Android OS.
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