Google will have to reassure its Android partners such as Samsung Electronics Co. and HTC Corp. that Motorola’s devices won’t get souped-up versions of the software or receive other preferential treatment.
If it appears Google is favoring Motorola, manufacturers might consider building their own mobile operating system or defect to Microsoft Corp.’s Windows software, which is getting a major facelift this year.
“This gives Google a chance to develop and showcase a `next generation’ device for mobile computing,” said N. Venkat Venkatraman, a Boston University professor specializing in technology and management. “But it could also create a complex issue for Google. How do you balance the desire to create something that consumers love without upsetting the rest of the Android ecosystem?”
“Like almost everything Google does, I think they will try a lot of different things and then do whatever is best for them,” Milanesi said.
Signaling its intention to experiment, Google said it has created an “advanced technology and projects group” at Motorola. It will be run by Regina Dugan, a former director of the U.S. Defense Advanced Research Projects Agency, or DARPA, which specializes in coming up with national security innovations. DARPA was how the Internet got its start more than four decades ago.
In a statement Tuesday, Motorola spokeswoman Jennifer Weyrauch-Erickson said the plan under Google’s ownership is to make “fewer, but bigger launches.” She said Woodside wasn’t available for an interview.
Motorola’s cable-TV boxes could provide Google with a springboard for delivering more of its services, including advertising, to living rooms. However, cable companies control the market for set-top boxes, and they resist any intrusion into their realm.
Page already has decided to operate Motorola separately partly because of the contrasting fortunes of the two companies. That will make it easier for investors to track how the different lines of business are faring. For now, Motorola will continue to have its headquarters in Libertyville, Ill., far from Google’s Silicon Valley home in Mountain View, Calif.
Google shares fell $13.17 or more than 2 percent, to close Tuesday at $600.94.
Google laid off about 300 people in 2008 after it paid $3.2 billion to acquire online advertising service DoubleClick Inc., which was previously the biggest deal in the company’s history. The cutbacks represented about one-quarter of the workforce that Google inherited from DoubleClick. If Google imposes a similar reduction on Motorola’s 20,500-employee payroll, it would translate into about 5,000 layoffs.