Motorola Solutions CEO On The Google-Motorola Merger, Patents And Brand

Google’s August announcement that it would acquire Motorola Mobility surprised many people in the telecom industry. Among them: Motorola Solutions Chief Executive Greg Brown. The news was of particular interest to Brown since he served as CEO of the old Motorola, Inc. from Jan. 2008 until the company split in two pieces this past January. Since then, Brown has been CEO of Motorola Solutions, an independent, publicly traded company that inherited Motorola’s enterprise-focused businesses of two-way radios, bar-code scanners and wireless broadband networks. (For a look at Motorola Solutions’ future, see my magazine story, The Other Motorola.) Motorola Mobility was the other company created by Motorola, Inc.’s split. It took over the company’s consumer cellphone and set-top box divisions. It was the timing of Google’s announcement that startled Brown. “It was relatively quick,” he noted in an interview at Motorola Solutions’ Schaumburg, Ill. headquarters. Like Motorola Solutions, Motorola Mobility was formed in January, so Google’s news came just seven months after Mobility was established. Brown may have been surprised, but he said he understood the merger’s logic. The deal will give Google — and the many companies that produce devices based on its Android mobile platform — access to Motorola Mobility’s 24,000 patents. The common interpretation of the swap is that the patents will help Google and its Android partners defend themselves against lawsuits from competitors like Apple and Microsoft. Motorola Mobility, in turn, will gain financial stability from being part of Google. Brown appeared to agree with that view. “Mobility’s attractiveness to Google was primarily patent-driven,” he said. “The combination makes great sense.” Brown’s support for the acquisition stems, in part, from the fact that he doesn’t foresee any drawbacks for Motorola Solutions. Motorola Solutions and Motorola Mobility share two things: intellectual property and their iconic brand name. The allocation of those assets entailed a lot of thought and negotiation before Motorola, Inc.’s split, according to Brown. Fortunately for Motorola Solutions, both agreements were structured to withstand a change in control from a merger or acquisition. That means Motorola Solutions will maintain access — through a cross-license — to Motorola Mobility’s 24,000 patents, even after Google acquires Mobility. The cross-license is non-exclusive and viable only for the lives of the patents but should shield Motorola Solutions from future patent-related lawsuits. Brown isn’t overly worried about patent suits, anyway. Motorola Solutions’ sale of its wireless network infrastructure business to Nokia Siemens Networks earlier this year ratcheted down the company’s risk, said Brown. Most of the telecom industry’s big patent fights focus on the cellular and wireless technologies that power consumer cellphones and tablets and the networks that support them, not the walkie-talkies and business-centric computing devices Motorola Solutions makes. Motorola Solutions will also keep the Motorola name regardless of what Google decides to do with it. (Options for Google include keeping the name, winding it down or combining it somehow with Google’s own brand.) Motorola Mobility technically owns the name but Solutions has an exclusive license that is designed to act in perpetuity. Motorola Solutions simply needs to stay out of Mobility’s core market of consumer gadgets, much as it has since January. “We could make a [consumer] cellphone but can’t call it Motorola,” explained Brown. “Google could call its handsets Motorola or use the bat-wing [logo]. Whatever they do won’t affect what we do.” Brown also views Google’s $12.5 billion offer for Motorola Mobility as a sign that Motorola, Inc.’s split was the right move. “It reaffirms, more than anything, exactly why we separated the company,” he said. “There would be no way to get that value unlocked by keeping all these assets together.”