I like to say that there is two things that defined success in the tech business. The first is being lucky. The second is not mistaking luck for being smart. Larry Page thinks he is smart.
A number of friends have told me that I am overly critical of Google. Some of these friends think that Google invincible. I have often said that Google reminds me of Microsoft, a inch deep and a mile wide. They have the mediocrity of the old Microsoft without the greed of Bill Gates.
When Google bought Motorola a few years a go for $12.4 billion, I was sure it would end badly. Not only were they buying a company like an old horse, should be put out to pasture, they were buying a pile of problems and they would not have the skills to deal with them.
So now they are selling most of it to the china’s Lenovo Group for $2.9 billion. Google had also recovered $2.35 billion by selling the set top box part of the company to the Arris group who ever the hell that is. Google is keeping some advance development actives and most of the 20,000 patents that Motorola had (I bet some are pretty long in the tooth).
My guess is Google thought at first they would emulate Apple buy building their own phones and maybe set top boxes (remember the Google TV).
I don’t know how much Google had to write off in losses while they owned Motorola (they will still own it for a while as the deal needs government approval). But for a company that paid $3.2 billion for a company that makes thermostats and smoke detectors, the deal probably does not look that bad.
In the mean time there stock continues to go up. I remember those days when I was at Intel. Intel and Microsoft’s stock continued to go up until they dropped like a rock and pretty much stayed there for a decade or more. Note, I sold my Intel stock at the top in the low 70s in the 1st quarter of 2000. Google stock will continue to go up until it no longer does. If we have a major economic crisis (I guess, I should say “when”) it will go down and then as the tide runs out, the rocks will show.
I do promise to write a blog post in which I take the opposite side and challenge my negative assumptions about Google.