After selling Motorola’s smartphone business for less than a quarter of what it paid to buy it, Google is reportedly planning another acquisition in the mobile device space. This time Taiwan’s HTC is said to be the target. The company has been an Android also-ran for years, repeatedly winning accolades for its designs but failing to achieve sustainable profitability or market share.
According to Taiwan’s Commercial Times, Google wants HTC’s smartphone business, but not its virtual reality business. The report claims negotiations have entered the final stage, but also notes that this is not the first time rumors have circulated about a takeover of HTC. This time, news that HTC might be in play was broken by Bloomberg in late August. Google was mentioned as an interested buyer at that time.
HTC has been manufacturing Google’s Pixel phones, a fact that has been somewhat obscured by the California company’s #MadebyGoogle advertising campaign. If Google wants to be known as a hardware maker, buying HTC could be a good way to bring reality into sync with the marketing campaign.
Google probably learned a thing or two about how to run a mobile hardware business during the three years that it owned Motorola Mobility. Google bought that business is 2011 for $12.5 billion, and sold it to Lenovo three years later for $2.9 billion. But Google held onto most of Motorola’s device-related patent portfolio.
Google also reclaimed former Motorola Mobility president Rick Osterloh, who went with his company to Lenovo in late 2014. In April 2016, he left Lenovo to rejoin Google as SVP of hardware. Google has several hardware products: the Chromebook, Google Glass, and Google Home are some of the best known. But Osterloh is a world-class smartphone executive, so Google’s decision to bring him back suggests that the company does want to run a smartphone business.
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