Android, Inc. – A Brief 2011 Industry Analysis Written by Christopher Frost, Patricia Brown, Amanda Cabrera Edited by: Cristina Miklas, Sarah Caldwell Background Like a modern day Hewlett Packard, Android Inc. began as a true start-up firm. It was founded in late 2003 by Andy Rubin, a co-founder of Danger, with three former communications executives (Android, 2011). Rubin had scored a modest success the previous year with the T- Mobile Sidekick. As a follow up, Rubin wanted to develop a platform that could be used in mobile devices. The four members worked in secret until Google acquired the company in August 2005 (Android, 2011). This made Android a fully-owned subsidiary of Google and led to speculation that Google was planning to make its own phone. While Google was quietly buying up phone-related patents, Apple launched the iPhone with AT&T and made history. After a long wait, this prompted Google and 34 other companies to form the Open Handset Alliance (Android, 2011). The stated intention was to develop open standards for mobile devices; however, the real purpose was for all of the jilted bridesmaids to develop a challenger to Apple’s successful iPhone. It brought in hardware vendors like HTC and Samsung, along with telecom providers like T-Mobile and Sprint. Google’s contribution was the open-source Android platform which it provided to everyone free of charge. A year later, the first Android phone, the T-Mobile G1 hit the market. STEEP Analysis Technical Both Apple’s iOS and Android’s platform were developed from UNIX; however, Apple’s operating system is proprietary. Apple only licenses iOS for use with Apple hardware, like the iPhone or iPad, and it tightly controls anything that goes out with Apple’s logo. In contrast, Android has been freely distributed to vendors and is an open-source platform. Android provides the source code and SDK, or instructions, to developers so anyone can modify or change the operating system however they want. This openness has been Android’s greatest strength; however, it also means that Google has little control over what their partners do with the platform. When the T-Mobile G1 came out with a stock version of Android 1.0, it was initially dismissed as an unfinished product. In contrast to the polished iPhone interface, PC Magazine noted “serious problems with accessibility and usability (Chen, 2008).” Android’s fortunes started to change in late 2008 when HTC released the Hero. Unlike previous Android phones, HTC used its own user-friendly Sense interface with Android operating in the background. After HTC’s success, these vendor-customized user interfaces became the norm for 1 Android. On the marketing side, Motorola launched a media blitz with its Droid Does campaign which highlighted many of the Apple iPhone’s deficiencies. It poked fun at Apple’s restrictive policies on which apps could be in the Apple App Store. In June 2009, Apple boasted a catalog of over 100,000 apps compared to the Android market which had only 10,000 apps (Gibbs, 2009). However, application developers had been mumbling about Apple’s requirements and an approval process that took months. By contrast, an application developer could create an account and start publishing apps in the Android Market in the same day. Because of its ease of use, developers began to develop versions of popular applications for the Android Market as well as the Apple App Store. By the end of 2009, the number of apps in the Android Market had more than doubled. More importantly, the number of Android handset exploded from 2% of smartphone sales to 8% within just a year (Bernstein Research, 2011). To take advantage of its momentum, Google drove a very rapid rhythm of improvement for the platform, with one new release every 3.5 months, on average (Bernstein Research, 2011). Each release took the name of a dessert – 1.5 was Donut, 1.6 was Éclair, 2.0 was Froyo, 2.1 was Gingerbread. This constant stream of improvements allowed Android to quickly patch bugs and address shortcomings as it quickly matured as a phone OS. With each release, Android became a more polished and professional operating system. However, the pace of iterative development also caused issues for Google’s partners. Application developers had to write and maintain multiple versions of their applications so they could work on the different versions. There was also the issue of vendor and carrier modifications on top of the Android platform, which delayed and complicated product upgrades. While Apple just had one flavor, Android had a wide range of versions that it had to support and fragmentation was making it difficult to support existing Android products. In response, Android changed its release policy in spring 2011 to bundle fixes into larger annual releases and promised to better coordinate with partners (Costa, 2011). Android has expanded from its beginnings as a phone operating system into a variety of different products as an embedded OS. Barnes and Noble used Android as the basis for its popular Nook and Nook Color e-readers while Samsung and Toshiba use it for their tablets. Logitech made a TV box called the Revue and Sony made a TV with Android as its basic operating system. Even a washing machine, dryer, and microwave have been made using Android (Raphael, 2010). In the mid-90’s, Sun Microsystems promoted Java as “computing everywhere.” With Android and widespread wi-fi connectivity, Google could make anything an Internet-ready device. Consumers could soon turn on lights or control appliances remotely through an Android home control system. Legal It takes years to create an operating system from scratch. That’s why in creating its own platform, Android used the Open Source community to its advantage. Android based itself on a freely provided Linux kernel under the terms of an Open Source license. Then, it combined that 2 with freely available Java code from Sun Microsystems, and built its own programs on top of that. Historically, Google has treated patents and royalties as an afterthought. According to the chief IP officer for a patent consulting firm, “Like many young companies, they [had] an attitude of, ‘Let’s generate revenue first and ask questions later (Burrows, 2011).’” This rush to innovate has had consequences for Android’s partners. Three of Android’s partners – HTC, Samsung, and Motorola – have each been hit with patent lawsuits in the past year. In some ways, this is normal in the tech industry; however, Google - with few patents and lots of enemies - finds itself in a bad position. “This is an arms race,” says Christopher Marlett of MDB Capital Group, “Other companies have more bombs… [and are not] afraid to use them (Burrows, 2011).” When Oracle purchased Sun two years ago, Oracle sought to recoup lost revenues from the Android system. Over the past year, Android and Oracle have been locked in a court case where Oracle initially sought 6 billion in damages. Although that has come down below 2 billion, Oracle is also seeking a per unit license for Android’s use of Java classes. If this happens, the Android system wouldn’t be free anymore and future licenses would carry a set fee for the embedded Java. Google would have to choose whether to eat the costs and continue offering Android for free or pass along the costs to its vendors. Recently, Google has made bolstering its patent portfolio a high priority. Although it lost out on its bid to buy Nortel patents, it purchased 1000 patents from IBM and launched a surprise $12.5 billion bid to take over Motorola Mobility which holds over 17,000 patents (Spangler, 2011). According to a blog post by Google CEO Larry Page, “Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple, and other companies.” The effects of this acquisition were soon felt as Google loaned three of its recently acquired Motorola patents to HTC. And HTC turned around and used those three patents in a lawsuit against Apple. Socio-Cultural According to Tsukayama (2011), we are entering the post PC era. That’s because form-factor diversity has enabled computing in more contexts. Flash memory has eliminated computing downtime. Wi-Fi and mobile broadband networks permit continuous connectivity and cloud services support computing across multiple devices. These technological innovations fuel social change, and vice versa. As people conduct more of their lives online—shopping, banking, entertainment—we require more computing in more places. The rise of social networking requires real-time connectivity to manage our relationships (Tsukayama, 2011). The smartphone is changing how everything is done. It can be used not only as a method of communicating with others, but as a form of entertainment. With banking, games, music, social networking, movies, and email, an individual’s entire life is virtually tucked into their tiny phone. Businesses have to find new ways to compete, sometimes looking at how to improve an app for a phone before they revamp a website for the computer. Even the US government is 3 trying to adjust to changing technology, as they are considering using smartphones as a method of electronic voting in upcoming elections. (ScienceDaily, September 2011) Cell phones are the one item you generally never leave home without. Eight in ten American adults own a cell phone of some kind, and they are used for more than just making phone calls these days. Consumers are doing more research and selecting their phones based on the features it provides and the potential applications that come with it. Their expectations are changing because their awareness of mobile services is growing. With the addition of Internet options, games, music, cameras, ring tones, and applications, cell phones have become a form of handheld entertainment for all ages. Some 87% of smartphone owners access the internet or email on their handheld, including two- thirds (68%) who do so on a typical day. When asked what device they normally use to access the internet, 25% of smartphone owners say that they mostly go online using their phone, rather than with a computer. (Smith, 2011a) Nielsen recently revealed that the amount of data used by the average smartphone user has risen a whopping 89% over the past 12 months (Leggatt, 2011). Smartphones continue to grow in popularity. According to Nielsen’s May survey of mobile consumers in the U.S., 38 percent now own smartphones. And 55 percent of those who purchased a new handset in the past three months reported buying a smartphone instead of a feature phone, up from 34 percent just a year ago. Android continues to be the most popular smartphone operating system, with 38 percent of smartphone consumers owning Android devices (Nielsen, 2011). There is especially a rise for smartphones among minority groups. Over the past six months, 42 percent of white users who bought a mobile phone opted for a smartphone, while 60 percent of Asians/Pacific Islanders, 56 percent of Hispanics, and 44 of African Americans made the same choice (Whitney, 2011). The largest percentage of smartphone consumers are currently between the ages of 25-34. Consumers that are currently above the age 45 are slower to adapt to newer cell phone technology simply because they grew up without needing cell phones, computers, and other technology that is common today. As time goes on, and technology progresses, the aging population will never know a time when cell phones were not a part of their existence. The low usage by consumers age 45 and up will be adjusted as the overall population ages. Political Some analysts believe that Android could be as dominant in mobile as Microsoft was on the desktops in the 1990’s (Burrows, 2011). However, this dominance exposes Android to the same concerns about privacy issues, monopoly control and anti-trust actions that Microsoft faced in the 1990’s as well. One early example arose from Android’s collection of location information. Because GPS is not always reliable or available, Android smartphones can also use low-power wi-fi to determine a 4 rough location. It then uses this information in its location-specific products, like Maps, Local Search, and Places. According to a Google spokesperson, “The benefit of such a method is that it quickly finds a device's location … and all the data collected… is entirely anonymous (Reisinger, 2011).” As a preemptive response to European regulatory authorities, Google announced that it was going to include an opt-out feature for its collection of wireless location data (Reisinger, 2011). This September, Google’s executive chairman, Eric Schmidt, testified to a Senate Judiciary subcommittee over charges by Yelp that Google cooked the results of location-based search items to favor Google-related sites (Greene, 2011). “The Internet is the ultimate level playing field,” said Schmidt, “We focus on loyalty not lock-in.” He denied any bias in the results, avoided an imitation of Bill Gates’ infamous tantrum, and said that Google had learned from Microsoft’s battles with the Department of Justice and that “one company’s past need not be another’s future (Greene, 2011).” Economic A promising trend for Android is the explosive dual growth of both mobile communications and mobile Internet use. Interestingly, the biggest growth is seen in developing economies like Egypt or the Philippines where landline communications had long languished. In 2001, the Philippines only had 4.5 million customers using landline phones compared to 16 million who used cell phones. Since then, the number of landline customers is almost unchanged while there are now 86.2 million mobile customers out of a population of almost 100 million people (Economist Intelligence Unit, 2011). And out of all those customers, Internet World Stats found that 29.2% of them use the Internet – mainly from a mobile device (2011). Tomi Ahonen, a former Nokia executive, think smartphone sales could reach billions of units annually before 2015, "If we take today's top smartphones… that kind of phone will cost $10 to sell profitably in 10 years. That means that anyone on the planet [who] can afford a $25 phone today…can easily afford what we consider a top smartphone of today…as a new device in far less than 10 years (Arthur, 2010)." As more of those customers upgrade their phones over the next few years, there are a range of extremely cheap Android clones from Chinese manufacturers like ZTE and Huawei that will be tempting choices. Industry Analysis Rivalry Among Existing Firms Apple. According to Bernstein Research, Apple has “reached the critical mass required to a strong high-end dominant player (2010, p.132). Currently, Apple’s share of the smartphone 5 market is 19%, compared to Android’s 38% of the global market (Dow Theory, 2011). However, Apple has a devoted following of early adopters willing to pay a premium and its iPhones continue to be the individual leading handset. Because of its launch with Verizon this past spring, Apple’s iPhone grew faster than Android in Q2 of 2011 (Channel Insider, 2011b). And with Sprint’s upcoming announcement of the iPhone 5 this fall, Apple will soon sell its iPhone through 3 of the 4 leading carriers in the US. Its tablet, the iPad, is the indisputable king of tablet computers and the Apple TV has been winning over more customers lately. Android. From 2009 to 2011, Android has grown from a 3 percent share to a 48 percent share of the smartphone market (Burrows, 2011). With Android’s creator, Andy Rubin, proudly pointing out that Android is being activated on more than 500,000 phones and tablet each day (Channel Insider, 2011b). While Apple might be a premium solution for early adopters, Android has staked a commanding position as a value brand. “Nearly two-thirds of respondents feel that it’s not possible for Microsoft, RIM, HP, and Nokia to reverse momentum relative to Google and Apple (Eddy, 2011).” Blackberry. Research in Motion (RIM) had the grandfather of smart phones with the Blackberry. Since the late 90’s, corporations flocked to the Blackberry for its robust enterprise e-mail solution and high call quality. However, RIM failed to innovate as Apple came out with the iPhone. Michele Pelino pointed out that, “[Blackberry is] entrenched in that enterprise environment and now that environment is going … to other OSs and devices (Boulton, 2011).” Recently, RIM has pinned its hopes a new line of phones coming out in 2012 with its new QNX operating system; however, Jack Gold notes that, “the next 6 to 12 months are critical for RIM (Boulton, 2011).” Palm. Like Blackberry, Palm is another legendary name is the smartphone industry. Palm launched its Pre just as the first Android handsets gained acceptance in the market. Palm’s webOS garnered great reviews, but the hardware was plagued with problems. In fact, Android gained a lot of Palm’s customers as many of the Pre phones were returned and traded for Android phones. Plagued with a long history of cash flow problems, Palm was purchased by HP in 2010 to supplement their consumer electronics division. The next year, HP put a significant marketing push into Palm products. The HP TouchPad was HP’s answer to the Apple iPad and Samsung’s Galaxy Tab 10.1; and had plans to release a related Pre 3 smartphone with AT&T. However, sales were disappointing. With retailers, like Best Buy, sitting on half a million units of TouchPad’s in inventory, HP abruptly killed the TouchPad only 48 days after the product launch. Then, it slashed the price from $399 to $99 in a fire sale and announced that it was getting out of the consumer electronics business. The ensuing fallout destroyed HP’s distribution network overnight. Although webOS might be floated as an independent platform, it would be difficult to have partners sign on if HP is involved. Microsoft / Nokia. Microsoft has been a player in the smartphone market since the 90’s. It pioneered Android’s model of licensing the software to a host of hardware vendors; however, its Windows Mobile initiatives never gained much traction. Like Android, Microsoft had to deal with fragmentation across its different vendors. When it tried to make its own hardware, the result called the Kin was pulled after only an embarrassing 47 days on the market (Channel Insider, 2011a). 6 Nokia enjoyed a lion’s share of the global phone market with its antiquated Symbian OS; however, Symbian is a limited operating system and wasn’t designed to compete with Apple or Android. It was designed a decade ago to work on dumb phones and Nokia’s market share had been plummeting as customers traded in their “dumb phones” for smartphones. In February, Nokia announced plans to license Microsoft’s upcoming Windows Phone OS for all of its handsets. It was a coup for Microsoft’s marketing efforts; however, its market share continued to decline after the announcement from 7.7% to 5.9% (Channel Insider, 2011b). Microsoft hopes to reverse the trend with its upcoming Mango release which will correspond with Windows 8 and Xbox releases, but both Microsoft and Nokia have an uphill battle in the months ahead. Threat of New Entrants Because creating an operating system is such a resource-intensive endeavor, there is a large barrier to entry and it takes a long time to launch a competing product. At the moment, there are no new operating systems in the works. However, firms are looking for ways to take advantage of the revenue-generating opportunities – to the detriment of Android. Even though Android is freely distributed, that doesn’t mean that it doesn’t generate revenue. Android serves as a launchpad into Google’s ecosystem of Apps, Books, and Movies. From 2009 to 2010, the Android Market saw an 862% increase in app sales with annual revenue of $102 million (Krause, 2011). It accomplished that by expanding its library of apps from 20,000 to 250,000. Despite that impressive percentage increase, it’s still a small piece of the 2 billion dollar app market dominated by Apple with an 86% share. To increase app sales, Google radically revamped its Android Market in summer 2011 to better promote paid applications. Although prolonged arguments with the music industry prevented the launch of an iTunes-like music service, Android expanded its Market to include downloadable books and movies. As the parent company, Google has invested heavily in Android. That’s because Google derives a great deal of its revenue through ad traffic from its search results. By putting Android on millions of new smart phones, Google increases its search results exponentially. The Android platform’s greatest strength lies in its ability to be customized, but carriers and vendors have seized on that as a way to generate their own revenue. In the spring of 2011, Amazon launched its own Appstore for Android. As a running promotion, Amazon gave away a different paid application every day. This effort cracked Android’s monopoly on paid applications and deterred revenue that would have gone to Android. At the time of this analysis, Verizon was also setting up its own App store to compete with the Android Market and others are in the works. Another important revenue source is ad-traffic from search results. Android’s parent company, Google, makes money off its Android phones since it is delivered with a full suite of Google products. However, other players are breaking into this market. One of Android’s hardware vendors, Motorola, signed a recent agreement with Microsoft to embed Bing as the search engine 7 for its Android phones. Through ad traffic generated by Bing, Microsoft makes money off a “Google phone”. Also, Facebook and Google are encroaching on each other’s territory with Facebook moving into search and Google moving into social networking. And through its Facebook application on Android, Facebook can provide services that directly compete against Google. Bargaining Power of Buyers In the United States, the largest bulk buyers of smart phones are actually the pre-paid cell phone companies like AT&T, Verizon, Sprint, and T-Mobile. In exchange for two year commitments, these companies provide their customers with a subsidized smart phone. Although the end customer’s contribution is commonly from 99 to 199 dollars, the American carriers normally absorb 500 to 600 dollars of the initial cost (Ferragu, 2010). As sales of the Hero and Droid took off in 2009, Google saw a chance to change the way that people bought cell phones by releasing its own pure-Android handset, the Nexus One. Google had HTC manufacture the phone and offered it through an online store. There, customers would be able to buy the phone and comparison shop among the various carriers. Using the Nexus One as leverage, Android and Google wanted to interact directly with the end consumers and break the power of the cell phone companies (Lahiri, 2010). Unfortunately on launch day, the only carrier with an agreement was T-Mobile. Verizon and Sprint dragged their feet and later decided not to participate. Since the phone was offered without a subsidy, customers had to pay the full price upfront. If they signed up for T-Mobile service, they would receive a rebate, but the rebates were done by check and not credited upfront. Worst of all, service agreements had not been worked out. There were no service centers where people could return defective handsets and no phone support where users could call in with problems. Google had only set up a help site of Frequently Asked Questions and a discussion forum. Google’s attempt to change the way Americans buy phones failed. The fallout was a public relations nightmare as Google had to turn to the cell phone providers and its manufacturer, HTC, for help with returns and unhappy customers. As a result of the Nexus One direct-sales fiasco, Google abruptly got out of the cell phone manufacturing business. It closed the Nexus One online store and had to soften its stance with the cell phone companies. This also greatly strengthened the cell phone providers’ bargaining position. This shift in power showed up when three of the four carriers backed a payment system called Iris that would compete against Android’s upcoming Google Wallet service (Yin, 2011). Although mobile payments have been increasingly common in Asia, they have been unheard of in the US. With Android’s support for Near Field Communications (NFC), it will be possible for users to pay at participating vendors simply by swiping their phone. In not backing Android’s payment service, the carriers kept an important future source of revenue for themselves and away from Google. 8 As early as 2007, there had been talk of Google buying a telecom company. Because of the immense cost in building a national telecom company and maintaining thousands of miles of fiber, there is a very large barrier to starting a new telecom. Although there are a number of small regional carriers like MetroPCS or Cricket, these companies pay the large carriers for bandwidth and tend to have pre-paid customers with unsubsidized phones (Lahiri, 2010). This forces Google and Android to deal with the big four telecoms in the US market. Recently, Sprint became a preferred partner for Google: replacing its voicemail with Google Voice, carrying the Nexus S, and participating with Google Wallet (Mui, 2011). And Mui speculates that Google could buy Sprint for less than $10 billion from its $26 billion in cash reserves (2011). However, buying a telecom company would instantly alienate Android’s existing telecom partner relationships and endanger Android sales with those companies. With the Motorola Mobility purchase still pending regulatory approval, it is highly unlikely that Google would jeopardize that deal by making a bid for Sprint. Instead, it is trying to make conciliatory gestures to both its hardware vendors and cell phone carriers. Bargaining Power of Suppliers Unlike Apple or Palm, Android is completely dependent on outside vendors to create its Android handset. It has partnered with HTC, Samsung, LG, Motorola, and a number of smaller manufacturers to bring Android phones, tablets, and other devices to market. “Android has cut the cost of building a phone by 90 percent,” says Shay Benchorin, director at Mentor Graphics, “Making products at a tenth of the price is a no brainer (Dempsey, 2010).” The handset market is very attractive for electronics manufacturers. Over the last 10 years handset vendors have posted double-digit operating margins compared to just 2% for PC manufacturers. As a matter of fact, mobile phone gross margins have historically been around 30 to 35 percent - halfway between the margins of laptops (around 10%) and leather handbags (around 70%) (Bernstein Research, 2011). That’s why consumer electronics giants like Dell and Sony keep trying to break into the market with their own variations on Android devices. However, two of the largest vendors – Samsung and HTC - have hinted at designing their own operating systems to replace Android. Together, they produce a quarter of the Android handsets in the world. Even though Android has made them wealthy, it has also exposed both firms to lawsuits and headaches coordinating version releases. When Google recently purchased Motorola Mobility for its patent portfolio, it publically reassured its partners that it would treat Motorola no differently than any other vendor. Months later, it is still unclear whether Google will keep the Motorola handset business, spin it off on its own, or sell it to another vendor. If it keeps Motorola, Google might follow Apple’s model and have a channel for producing its own “pure Google” device – free of vendor interference. Threats of Substitute Products 9 Before the end of 2010, smartphone sales were dwarfed by PC sales. During the first three months of 2010, 85 million PCs were sold worldwide, compared with 55 million smartphones. At the time, even the most optimistic analysts forecasted that the PCs would continue to outsell smartphones until 2012. Instead, in the last three months of 2010, 94 million PCs were sold – and 100 million smartphones (Arthur, 2011). Now, IDC reports that PC shipments are expected to grow by only 4.2% in 2011, down from their February forecast of a 7.1% market increase (Gaudin, 2011). That’s anemic compared to consumer PC shipment growth of 18.9% in 2007 or 21% in 2009. In his recent Washington Post article, Topolsky (2011) admits that technological companies are now focusing their futures on tablets, smart phones and software and Google expects searches from mobile phones to exceed searches from PCs before 2013 (Arthur, 2011). Laptop computers are becoming increasingly overlooked as smartphones become cheaper to purchase, and an easier method to access the internet with. Ogg (2011) contends that Laptops will continue to get faster processors, and marginally thinner but the rise to alternatives to traditional PC’s, tablets, will continue to march on. Even in 2015, when about 82 million US consumers will own a tablet, more US consumers will own laptops (140 million). So while the era of the primacy of personal computers in their traditional form is fading, they are not disappearing entirely. They’re just taking on a different form (Ogg, 2011). Microsoft is fighting back with a marketing push for its new Windows 8 operating system. PC vendors are hoping that consumers will upgrade their PCs to faster, newer models that it will take to run Windows 8 smoothly. PC’s will not completely get wiped out. There will still be several hundred million PCs sold worldwide for several years because people will still need PCs for certain tasks, however, many tasks done with personal computers can be carried out with a decent-sized touch screen and a good internet connection. Conclusion Over the next year and a half, Android as a platform will continue to be popular with manufacturers. Despite partners’ apprehension about intellectual property claims, Google took a substantial step toward tackling with that with its recent purchase of 1000 strategically important patents from IBM and outright purchase of Motorola Mobility. Also, partners like HTC and Samsung have seemingly come to accept Android’s spotty intellectual property issues as a price of doing business. This is illustrated by HTC paying Microsoft $5 for every Android handset and Samsung settling with Microsoft for an undisclosed amount. The upcoming release of Android 4.0, or Ice Cream Sandwich, should resolve the fragmentation issues seen between the phone version and the tablet-specific version. A bigger challenge will be the erosion of Google’s ability to make money off Android. Amazon recently announced its Amazon Fire tablet which will use its own highly customized version of Android. However, it won’t have the Android Market or use Google other mobile products. 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Android, Inc. – A Brief 2011 Industry Analysis Written by Christopher Frost, Patricia Brown, Amanda Cabrera Edited by: Cristina Miklas, Sarah Caldwell Background Like a. ways, this is normal in the tech industry; however, Google - with few patents and lots of enemies - finds itself in a bad position. “This is an arms race,” says Christopher Marlett of MDB Capital. 17,000 patents (Spangler, 2011). According to a blog post by Google CEO Larry Page, “Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will