MARKETS were yesterday digesting the implications of Google’s shock $12.5bn (£7.6bn) bid for Motorola Mobility.
Google slumped 3.4 per cent, continuing the cool reception after the announcement on Monday. However, investors across the sector appeared to be cautiously optimistic, with hopes that the bid will help to mitigate the adverse effects of future patent battles.
In theory, companies using Google’s software are now less likely to run into problems, with Google holding a sizeable portion of outstanding patents and unlikely to take action against its clients. This pushed stocks in Asian phonemakers Samsung and HTC up six and three per cent respectively.
Arch-rival Microsoft also gained on hopes that a Google-led Motorola could drive competitors to its Windows Phone 7 mobile operating system as an alternative to Android.
Blackberry-maker RIM traded slightly lower yesterday after receiving a bounce in the immediate aftermath of the bid, with investors hoping it may become a target for further industry consolidation.
The bid has also been seen as a validation of Apple-style vertical integration, with Google hoping to “supercharge” its future releases through seamlessly merging its hardware and software.
This could be especially important in the race to develop a credible, and saleable, alternative to the Apple’s iPad. Motorola’s Xoom avoided a critical mauling but has failed to set the tablet market alight since its launch earlier this summer.