Google, just months after completing an expensive buy-out of Motorola, have sold off one of the mobile company’s divisions, claiming $2.35b cash-and-stock in exchange for Motorola’s TV set-top box division.
The branch has been acquired by little-known American ‘networking equipment’ company Arris (producers of cable TV ‘voice & data equipment’), a $300m-valued company who have borrowed $2.05b (funded mainly by Bank of America Merrill Lynch and the Royal Bank of Canada) to complete the purchase along with giving a 16% stake in their company to Google.
Arris appear to be the winning bidder amongst a number of potential buyers for the set-top box business, including Pace UK, though Google have gone on to accept Arris’ proposition.
Motorola have operated in the set-top box business since 2000, first acquiring the business from General Instrument for $17b of stock. Later spun off into a separate division of the company, before Google took the reins of Motorola Mobility (and by extension, Motorola Home) earlier this year, though it is now in the hands of Arris.
The deal will see Google retain at least some interest in Motorola’s connected TV venture, though it could be considered a further removal of their presence in the market following the failed streaming/internet connectivity device Nexus Q earlier this year. They have claimed that they decided to sell off Motorola Home on the basis of it having greater potential for a ‘technology transformation’ that Arris could achieve by supplying the demand for ‘a new generation’ of fully-connected ‘home networking services’.
Current rumoured methods to develop such services include applying their voice and data connected features to any new Motorola products, whilst enabling them make an impact in the market in their own right through an established brand. While it might not be their name on the box, could Arris become one of the premier names in connected TV technology through this move?