Motorola has agreed to acquire Good Technology, the companies jointly announced Nov. 10.
The terms of the deal, which is subject to regulatory approval, were not announced.
The acquisition puts Motorola in direct competition with Research In Motion, makers of the BlackBerry device. Motorola has been selling the Q, which offers BlackBerry-like capabilities and can use Goods mobile messaging suite. With the purchase of Good, Motorola will be in the position of providing both the hardware and software for a mobile messaging device.
According to the joint statement, Motorola plans to continue making Goods mobile messaging, security and mobile productivity offerings available to existing customers and will try to increase Goods market share.
Currently, the only Motorola product that uses Goods software is the Motorola Q, which is available through Verizon Wireless. There has been speculation that a GSM (Global System for Mobile Communications) version of the Q would be available once the CDMA (Code Division Multiple Access) version is established. When contacted about this in September, Motorola officials declined to comment, but they didnt deny such plans.
"Going after BlackBerry is the most obvious reason to buy Good," said Avi Greengart, principal analyst for Mobile Devices at Current Analysis. "The other reason is going after mobile Linux without trouble with Microsoft," he said. Greengart said whether this acquisition will make Motorola a threat to RIM and its BlackBerry device will depend a lot on what Motorola does with it.
"I think strategically the acquisition was probably because Motorola wants to reduce its dependency on Microsoft," Greengart said. "Its already putting a lot of energy into the creation of mobile Linux … It would put enterprise-class mobile e-mail on to the new smart phone." Greengart added that the route to enterprise success would be for a company to build its own solution and its own middleware.
At this point, however, Greengart said he thinks that Motorola will find it tough to go up against RIM. "RIM has done a really nice job in creating an integrated solution," he said.
Analyst Jack Gold, on the other hand, said he isnt so sure that moving away from Microsoft is a primary reason for the purchase of Good. Gold, who is founder and principal analyst of J. Gold Associates, said Motorola and Microsoft have a strong relationship in "the enterprise-class device market" and that "Microsoft needs something to help them sell more mobile devices."
Gold said the real challenge involved in the purchase of Good will be to Palm. "Good has had most of their success on the Treo," Gold pointed out. "Now that Motorola is going to buy Good, what is going to happen to the Palm/Good relationship?" While the current statement announcing the sale said Good would continue to serve multiple platforms and companies, Gold questioned how that could happen.
"Does Motorola make sure they make the most functions available on the Motorola devices?" Gold asked. "Its like when Nokia bought controlling shares in Symbian … The fallout is that the independents like Palm have a real problem. Someone needs to pick them up."
Maribel Lopez, vice president at Forrester Research, said she thinks the purchase may be about more than completing a portfolio. "I think its just a big land grab in the enterprise mobility market at this point," Lopez said. "Anybody who wants to drive relevancy is hot. Theyre looking for that thing thats going to bring them to the customer."
In the long run, however, Lopez said, the acquisition will be positive for Good and for Motorola, and their customers. "Good on its own is not going to be as good as Good with Motorola," she said. "Motorola is really trying to make a name for itself in enterprise mobility. They had the handset market, and it was just one piece of the pie. Now they have a much broader application platform."
According to the companies, Goods software and services are in use by more than 12,000 enterprises worldwide. The acquisition is expected to close in early 2007.
Editors Note: This story was updated to include comments from analysts.
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