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TheStreet Open House

What Will Be Google's Android Strategy for Motorola?

Stocks in this article: GOOG

Motorola is primarily in Chicago. When it comes to producing a piece of $199 cutting-edge portable computer that only months earlier used to cost $399 or $499, Chicago is not what comes to mind. When I close my mind and try to imagine Chicago in the 2013 mobile computing economy, the only thing that comes to mind is a Trabant car from East Germany, ca. 1977: Bureaucratic labor, high cost, moving slowly.

Acer, Asus, HTC, LG and Samsung move quickly. They can engineer a device from scratch and bring it to market in four months. Google bragged how Asus did the Nexus 7 in four months. Now they are talking about Motorola taking at least 12 to 18 months to bring a device to market. Getting Motorola into shape to compete against Asus or LG seems as difficult as preparing a hobby tennis player for playing in the Wimbledon finals against Bjorn Borg.

Then add whatever disruption resulted from the pending merger. Has this set back Motorola's execution capabilities further? Who knows? Either way, it raises the question: Can Motorola ever recover from this, to catch up with LG, HTC, Samsung, Acer and Asus on the ability to engineer a $199 device in four months or less?

Actually, considering this first hurdle alone, it makes me almost too depressed to get to stage number two in this equation. If Motorola is fundamentally too incapable or just too slow or too expensive, what's the point of keeping it alive at all?

Second Constraint: Ecosystem Commitments

Eric Schmidt in particular has been very vocal about Google's commitment to the hardware partners and ecosystem as a whole. He has been very clear about the fact that Google is a fair player, and will not give its own hardware department (Motorola) any leg up. This is a tall order, sort of like saying that you won't favor your own child.

So far, all the evidence is that Google has been more Catholic than the Pope on this end. It seems to have treated all of its partners with a perfect firewall and arms-length equality. But can this continue?

What is the point of owning Motorola if there are no synergies? There is something inherently contradictory here -- an equilibrium that cannot hold: Either Google integrates Motorola, or it gets rid of it.

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