Google has just purchased a large share of consumer electronics manufacturer HTC, both giants in their own right. Is this a deal that is bound to shake the industry in the future?
It may not seem so now, but Google’s roots lie in software and services (Google search engine and Android, anyone?). Over the years, Google has expanded into many new industries, many of them tangible, such as tablets, smart watches, and even its own range of smartphones and virtual reality, so Google’s no stranger to hardware. And now it wants to step even further into the hardware realm; thus, the Google-HTC deal was born.
Google purchased Motorola many years back in a move that is considered by some parties to be the cause of ‘death’ of the former mobile phone giant, but its deal with HTC, thankfully, seems much more benign.
Google and HTC have actually worked together before, and their collaboration history is 10 years long at this point. Remember Google Pixel from 2016? That was the product of Google’s resources and HTC’s employees. And with this deal, it looks like those collaborations are going to become much more permanent.
Google has already solved its issues about patents a few years ago. Despite the rave about working offline, away from the office, or doing anything with the help of a network connection, really, Google is starting to get really serious about its hardware. After all, how can you use Google’s software if you don’t have hardware, and what better hardware can you get for your software than one you create yourself?
Now, by striking a deal with HTC, Google gets a vertical integration creates an Ouroboros between its hardware and software: it has services to offer, the software to run them, and the hardware in which the software may be installed. It’s like Apple’s control over its products, but much less in-house and much more collaboration.
In case you’re worried, HTC isn’t going anywhere – after all, it just received a financial injection worth $1.1billion courtesy of Google’s decision to purchase a stake in the company. With Google’s financial backing, you can safely assume that the $1.1billion share isn’t insignificant, but neither do they own HTC like they did Motorola. HTC will keep its ownership as well as their manufacturing plants. What will happen (which has already happened on a temporary basis before) is that a team of HTC employees will be parked under Google’s hardware organisation to work on the likes of Google Home, Google Wifi, Daydream View, Chromecast Ultra, and many more.
Google claims to be “new” at the hardware business, which might be true if taken in relation to its experience in software and services. With HTC’s talent, who knows what Android-based, fully-integrated software-hardware relationships can achieve?