<IT WORLD> Google leaps buyout
hurdle By Martin J Young
HUA HIN - Google's acquisition of Motorola
Mobility officially went through this week for
US$12.5 billion after clearing regulatory hurdles.
The United States and European Union approved the
deal in February but China dragged the digital
chain.
China's seal of approval came with
conditions though, primarily that Android should
remain a free operating system for mobile phones
for the next five years. Relations with the
Chinese authorities have been strained since
Google moved its search engine out of China two
years ago following a dispute over censorship and
information control.
Google chief
executive Larry Page announced this week that
Motorola Mobility boss Sanjay Jha had stepped down
to allow long-term Google executive Dennis
Woodside to take the helm.
Buying Motorola
in a deal originally announced last August allows
Google to expand into
hardware manufacturing. For the first time, it
will be able to produce its own branded
smart-phones and tablet computers. More
significantly. though, it will acquire about
17,000 Motorola patents that will bolster the
company's ammunition in the recent surge in patent
litigation initiated by rivals such as Apple.
Google has stated that it will not favor
Motorola over its other partners and that the new
division will operate independently from its own.
It was these anti-competitive concerns that
delayed approval by Chinese regulators who
remained unconvinced until this week.
Chinese law stipulates that any business
with operations in the contry that generate
revenues in excess of $1.55 billion (10 billion
yuan) per year, of which $62 million comes from
China, must receive government approval before it
can be acquired.
This is Google's greatest
buyout to date, the $12.5 billion price tag is
more than the sum of the 185 other acquisitions
the company has made since going public in 2004.
Industry Government
investigations and multiple lawsuits have been
filed against Facebook this week following an
initial public offering (IPO) that led to losses
in stock value just seven days after it went
public. The lawsuits accuse founder Mark
Zuckerberg, Facebook and a number of banks, led by
Morgan Stanley, of valuing the company too
aggressively and hiding weakened growth forecasts
ahead of its US$16 billion IPO.
Lead
underwriter Morgan Stanley stands accused of
failing to inform public investors of the lowered
revenue projections for the social network,
naturally those on the inside were aware of the
situation and could make a more informed
investment decision. Alongside Morgan Stanley were
JPMorgan and Goldman Sachs, who all took a share
of the $176 million in fees that bankers charged
for the share sale.
Private traders and
investors filed a class-action complaint on
Wednesday, claiming that Facebook's prospectus
mis-stated material facts and omitted relevant
details about the company's projected
second-quarter performance. According to the
lawsuit, plaintiffs have lost an estimated $2.5
billion collectively since the IPO.
The
stock was floated at US$38 and peaked at just
under $42 on the first day’s trading. The share
price has since slid around 16% to $33 at the time
of writing.
Software Microsoft
chief Steve Ballmer has been touting both the
current and the next version of Windows at an
event in Seoul. The company expects that 350
million devices running Windows 7 will be shipped
globally this year, making it "the most popular
single system", according to the chief executive
officer.
Corporate demand for Windows 7
helped Microsoft post third-quarter profits last
month that exceeded estimates. The latest
expectations indicate an accelerated demand for
the software. In April last year, the company
announced that it had sold 350 million Windows 7
licenses in the operating system's first 18 months
of availability. Success has come despite a huge
increase in demand for tablet computers, a market
that Microsoft has not yet been able to capitalize
on.
The Redmond-based company hopes to
muscle in on the tablet market with the launch of
Windows 8 later this year, with Ballmer continuing
to boast big numbers by saying that 500 million
users will have Windows 8 in 2013. The hype
continued to flow at the Korean tech forum, where
Windows 8 was described as the "deepest, broadest
and most impactful" iteration of the operating
system yet.
Rumors are starting to hit
tech blogs about a possible release date of
Windows 8 RC1 (Release Candidate 1). The first
week of June has been quoted on a number of
websites, though the final edition is not expected
to hit the shelves until October or later.
Rumor and hyperbole aside, Microsoft has a
lot of work to catch up with the likes of Google
and Apple, which are waging their own war over
consumers and dominance in the ever-expanding
smart-phone and tablet arena.
Legal A California jury decided
that Google’s use of Java on its mobile platform,
Android, did not infringe on Oracle’s patents. The
decision, which came this week, has put an end to
Oracle’s claims for millions in compensation from
the search giant (see Oracle
threat to Android, Asia Times Online, April
21, 2012).
While the trial has been an
expensive and humbling one for Oracle, the company
is not ready to get out of the courts yet: next
week it is set to go head-to-head with Hewlett
Package over software disputes for Itanium server
microprocessors.
Martin J
Young
is an Asia Times Online correspondent based in
Thailand.
(Copyright 2012 Asia Times
Online (Holdings) Ltd. All rights reserved. Please
contact us about sales, syndication and
republishing.)
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