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Tony Fish
all things digital, identity, trust, growth, vision and value creating
all things digital, identity, trust, growth, vision and value creating

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Is the Google deal about Larry Pages' desire to become the best strategist in the world?

Surprised at the latest Google deal to acquire Motorola Mobility for $12.5Bn, you should not be; Eric Schmidt was very clear back at MWC in FEB 2007 "Mobile Mobile Mobile" and since then Google has focussed both time and effort to deliver andriod (which was itself acquired). When Schmidt stepped down in saying " adult supervision no longer required" this left open the matured Larry Page to step up from being great at maths and a world leading entrepreneur, to take on the mantel of "world leading strategist and deal doer."

This deal will be the discussion point for the next 3 months and already there are a lot of views circulating about what it means but there is no doubt that depending on your stance you can argue for change. However at Mobile 2 on 1st Sept in SFO - we get the first bite, why not join in.

The Deal
Google purchased Motorola’s mobile business for $12.5 billion. In doing so, Google brought patents, hardware design, manufacturing and a seat at the patent table. However the context is... Oracle suing, Apple winning, eco-system struggling, Samsung annoyed and Microsoft attacking

Worthy of Note
Google has bought in cash and not shares. This commitment will reduce their cash balance to $22bn from the mid thirties, but it is cash. Given the issues that cash purchases delivered to telecoms in 2000/2001 this is an important fact as many ran into immediate issues and sold off key assets. However, I expect the reason that this is cash is that Google are not expecting to hold the operational assets for long. An equity purchase could have caused them problems from shareholders when they flip it assuming it completes in Q1 2012

Why now?

Porter 5 forces model is helpful here as it highlights the dynamic nature of the mobile market that Google faces. Their power is low, their service fragmented and they are being attacked.

This deal will be the discussion point for the next 3 months and already there are a lot of views circulating about what it means but there is no doubt that depending on your stance you can argue for change. However at Mobile 2 on 1st Sept in SFO - we get the first bite, why not join in.

Starting from the view of the world formed by ....

Operators Deal does not change anything as we are the controllers of mobile - we keep all manufacturers below 30% market share and make sure it is a competitive supply market. However, we are still worried about becoming bit pipe....
Oracle/ Sun/ Java Defence needed as android has been beset with legal challenges from all sides, including a multibillion dollar lawsuit filed by Oracle, but Motorola patents are about wireless tech and unlikely to help.
Microsoft/ Nokia Attention is off us - heads down lads and deliver. Worth reading the pervious insights on MSFT/ Nokia deal and how to befriend the operators.
Apple By purchasing a manufacturer, Google has admitted it needs more than just a free operating system and loads of partners to compete with Apple: they need to duplicate Apple’s successes by totally controlling both the hardware and software of their devices.

OEM 's "Google has gone from partner to competitor."
Media/ Content owners According to Infonetics, Motorola Mobility was the leader in set-top box revenues last year, and was also tops in hybrid IP/QAM set-top boxes -- that is, the boxes used by operators like Verizon that combine broadcast TV and over-the-top applications. By leveraging Motorola's position with carriers, Google can better solidify its bid to expand Google TV and Android into the living room."
Developers At least there is one less system to deal with

Scenarios and outcomes

The production shop
In this scenario Google keeps Motorola as is and starts to manufacture it owns handsets. In reality this could provide short term stability to the fragmented andriod market place and show case devices and move into other screen based markets, but in the long run looks like a new Apple and being open is probably not a true option. Probability in long run 10% as this would not elevate Page to world class strategist who is just following Jobs view of the world.

The negotiator tactic
This is the company official line that the acquisition brings 17,000 patents (but are they relevant) to Google and enables them to robustly defend their mobile position and also expand. It is a $12.5bn investment to get a seat at the table. Strategically there is a lot of truth in this as mobile will dominate long term strategy and value. Probability in long run 25% as patents only last for a period....

Power to disrupt
Imagine Google takes the patents, yes they are useful to defend/ negotiate but also to empower others if free and open. This would reduce the power of others in the market and change the dynamics
Imagine Google keeps the patents and sells on production to Samsung to create a global partner across all screens
Imagine Google Wallet becomes the model - forget small transaction fees - lets go for user data in every model

Probability in long run 65% and Larry Page is now the best strategist in the world and did it without adult supervision.

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Changed picture to a number as I cannot be a name? This follows the story of Kaliya (Identity Woman) who still can't have her Google+ Name of choice and is still SUSPENDED!!!! and doesn't have name sovereignty. Worth reading her post on the issues

Nymwars: IRL on Google's Lawns.

We need to bring this struggle to Google IRL (In Real Life - physical, real world, meet space). Here is my thinking on why and my ideas about how.

WHY: Even women with privileged access to Google insiders and who have real name handle combinations are not getting reinstated.

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The 2011 Innotribe $100K Start-up Challenge will introduce the most promising FinTech and Financial Services start-ups to SWIFT’s community of more than 9,700 banking organisations, securities institutions and corporate customers in 209 countries.

On September 21, 2011 at Sibos in Toronto, 10 finalists, selected by their peers and expert judges, will present to an invitation-only audience of dozens of decision makers from the world’s largest financial institutions, serial entrepreneurs, investors and media. And on September 22nd, two of those companies will each be presented with a check for $50,000 in front Sibos’ audience of 8000 financial industry professionals. Learn more.

Applications are due by August 14th, so if your start-up is ready for the recognition and rewards it deserves from the global financial services industry, register for this site and apply to the 2011 Innotribe $100K Start-up Challenge today!

I will be one of the judges......

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Just over four weeks away from Mobile 2.0! on September 1st in SFO and as we have sold out every year for the past 5 years, please do register. If you send me an email at, mentioning this Blog, I will send you a special discount code....
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