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Industry Opinion: Google Acquires Motorola, Impact On Online Advertising?

Submitted by on August 17, 2011 – 2:00 pm

From time to time we ask our readers for their for their opinion on news that has an impact the industry, something we do here on Profectio and on PR In Canada.  The world is still buzzing over Google’s acquisition of Motorola Mobility on Monday for $12.5 billion, but we wanted to know, what impact will this have on online advertising?

We reached out to 4 individuals for their take on the situation, Corby Fine, Senior Director, Business Development at Rogers Digital Media; Matt Di Paola, Chief Strategy & Innovation Officer at MediaCom Canada, Neil Sweeney, President & CEO at JUICE Mobile and Chris Patheiger, Vice President, Business Development at Redux Media.

Profectio: What was your first thought when you heard the news? 

Corby: My first thought was that Nokia and even RIM just got a lot more appealing in the market to other suitors, particularly the possibility that now Microsoft may act quickly on buying Nokia. As well, I wish I was holding Motorola shares.

Matt: I was surprised that Google didn’t acquire RIM actually. Thought that would make a stronger play against Apple. However, as i dug into the story a bit, it was clear that this was about patents and future integration. Motorola has 17,000 patents which now go to google. This is a marathon, not a sprint for Google and the patent war is on.

Neil: I was not that surprised.  Sure, the number jumps out at you but after Google lost out on the Nortel patents it was pretty clear to me that they were going to make a play for a portfolio to compensate for the loss.  I think especially with the number of suits that have been taking place that this was more of a defensive measure that one to get into the manufacturing business.

Chris: I was not surprised. Google has been focused on software up to this point. A move to hardware makes perfect sense. I think Dan Misener at CBC hit the nail on the head when he said this deal is really interesting because of the patent angle. Along with a strong footprint in mobile, Google is buying more than 17,000 patents worldwide, with 7,500 patent applications in process. These cover “many applications” and “wireless standards.” Add to this the growing level of competition between companies like Microsoft and Apple that are building their own arsenal of patents, acquisitions and preparing long term battle plans.

Profectio: How will this deal impact online advertising?

Corby: I’m not sure it will have a short term impact given the fact that mobile advertising in Canada is still in it’s infancy. Where I see the impact coming is when the overall tipping point for mobile advertising in Canada is hit and more money is spent through the mobile channel. By Google now being able to increase the market share of Android devices, they stand to take a larger share of the overall mobile advertising pie.

Matt: I haven’t considered that. Not sure it will, unless we are talking cross platform advertising, in which case, i have to assume some of Motorola’s patents and technology should help Google TV & YouTube to compete with Apple TV by providing more custom content solutions across multiple platforms and therefore more targeted advertising opportunities.

Neil: It won’t.  The reality is this is a technology play, not an advertising play.

Chris: I don’t think it will in the short term.  In the medium and long term, I feel like it will impact mobile advertising much the same way adwords has impacted ad networks and rep firms in the online space.  Google is coming up with roundabout solutions to own the relationship directly with the advertiser leaving less room for resellers.

Profectio: How will it impact mobile advertising?

Corby: The general increase in Android market share, regardless of Google buying Motorola will force developers and advertisers to look more closely at the platform. Currently iPhone and Mobile web are the focus in Canada, look for that to change quickly.

Matt: Certainly, this will help Android spread their platform across more devices and will give their mobile product a larger reach. It will depend on google’s ability to integrate their mobile advertising product and package it properly with the data across advertising, location-based solutions, mapping, apps, etc.

Neil: Same as above.

Chris: See above.

Profectio: Will we see any impact on the Canadian advertising industry?

Corby: Most likely a larger focus on developing for the Android platform, which was happening regardless of this acquisition. Google purchasing Motorola may just speed up the process.

Matt: Yes, we will see RIM continue to be squeezed out of the market until they are acquired by someone.

Neil: Zero

Chris: Eventually.  Canada has always been a good year or  two behind the US in terms of adoption rates for new ad centric technologies.  As time goes on, that gap is closing obviously.  That said, a transaction alone of this size will take the better part of a year to close, provided that there are no unforeseen FTC issues.  From there, I suspect Google would be a year or so out from launching a mobile ad platform that would significantly impact the Canadian space.  Add to that the adoption rate… We’re talking two to three internet years before we really feel the impact of this – IF it happens at all.

Profectio: Would you buy a Motorola/ Android phone?

Corby: I am not in love with Android (yet), but see it catching up to iPhone from a usability perspective. As well, the potential improvements from a device/OS integration should force me to look at Motorola/Android devices as they come to market from the new owners.

Matt: I would, but i already have the HTC nexus, which i enjoy very much. At some point, as the technology evolves, i will upgrade and it will depend on google’s ability to integrate all of their solutions and the data they have about me to make my life easier.

Neil: Of course.  I currently use an Android Nexus S phone (made by Samsung).   Suspect that we will soon see the casing of the next iteration move from Samsung to MOT.

Chris: It’s hard to say. I drank the Apple flavoured Koolaid a while ago and have been a dedicated iPhone supporter for better or for worse. The fact that all my Apple products (TV, MacBook, iPhone, iPad) interact so well and I purchase all my content from the iTunes Store, it would take a pretty revolutionary and innovative phone and likely a whole new system to get me to switch.

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Dave Forde

Dave “The Connector” Forde has been involved in the technology industry across Canada for over 10 years in sales and marketing roles, he launched PR In Canada, and on Profectio.

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