It is difficult to enter to old business as a new player. Incumbents will do what ever it takes to make entry barrier as high as possible. Google tried to solve the patent problem first with Nortel deal (6000 patents in line) but defense line of incumbent players hold.
“If there is will there is a way”. Google has demostrated that the saying is true. Google aquisition of Motorola Mobility does not only give access to engineering and sales power to go full speed with mobile phone business but also solves the patent problem.
Motorola mobility has about 17,000 patents.
What comes to valuation of the assets. In Nortel case rough numbers were
USD4.5B/6000 = USD 750k per patent
and now with Motorola case
USD12.5B/17000= USD 735k
the math is clear this is a patent deal.
