Google had a rough week.
Less than two years after acquiring Motorola Mobility for $12.5 billion, it sold the cell phone manufacturer for $2.9 billion to Chinese tech conglomerate Lenovo. While Google got plenty of patents in the deal – and a new Android phone — it sold Motorola for a quarter of what it paid for it. Why? The company was losing money.
As the New York Times wrote about the deal, “Larry Page, Google’s co-founder and chief executive, likes to talk about ‘big bets’ and ‘moonshots.’ But the thing about moonshots is that they can crash to Earth. That appears to be what happened to Motorola Mobility, the cellphone maker owned by Google.”
Motorola also dragged down profits at Google in its most recent quarter, as reflected in the company’s earnings report Thursday. The company posted earnings of $12.01 per share (on revenue of $14.4 billion – yes, billion). But that missed analysts expectations.
Meanwhile, across the pond, Google is settling a three-year-old anti-trust case with the European Commission. The European Union’s executive body said Google favored its own products in searches. Google has avowed to change its practices, avoiding a hefty fine.
The company’s stock continues to climb. In case you forgot, it’s good to be Google.
Also read: Why Studios Prefer YouTube for Their Biggest Trailer Debuts
Speaking of companies familiar with anti-trust cases, Microsoft is about to get a new CEO. Bloomberg reported Microsoft’s board is about to name Satya Nadella, the head of enterprise, to take over for Steve Ballmer.
When that happens, co-founder and CEO Bill Gates may also step down as chairman of the board. If you want to know why, read Kara Swisher’s take here.
Here’s what else happened in the digital media world this week:
Facebook is worth $135 billion.
Facebook reported stellar financial results as the company nears its 10th birthday, due in large part to its growing mastery of making money from its mobile site and apps. It attributed more than half of its $2.59 billion in revenue to smartphones, tablets and other mobiles devices.
Oliver Luckett, CEO of social media start-up (and Facebook impresario), criticized Facebook during a presentation this week, telling the crowd that too many ads were cluttering up the news feed. Facebook has encountered this criticism before, as some say it has surrendered the “cool” factor to Instagram (now part of Facebook) and Snapchat (decidedly not). But check this: 1.23 billion people use it.
Also read: Facebook Crushes Earnings Expectations, Stock Surges
Mark Zuckerberg sat down with Bloomberg Businessweek to share his thoughts on Facebook at Year X.
Yahoo shut down its second-screen app IntoNow.
Yahoo paid $20 to $30 million for IntoNow in 2011, betting that Adam Cahan’s company had created an ideal companion experience for television viewers. A surfeit of “second screen” apps of some kind surfaced in 2011 and 2012, offering viewers the opportunity to “check in” to a show or gather extra information about their favorite character. Most of those companies have either folded or been acquired (Miso, GetGlue). IntoNow has suffered the same fate.
Pitbull, Courtney Love and Will.I.Am. Are Coming to YouTube
Prominent reality TV producer Endemol signed deals with Courtney Love and Pitbull to develop TV shows and also digital series for its new digital-focused division, Endemol Beyond. Pitbull has played a part in a dozen hits over the past few years, and his global reach is a perfect fit for YouTube, the most popular video site in the world.
As for what Courtney Love‘s going to do? We don’t know.
Black Eyed Peas frontman Will.I.Am. signed a deal with Maker Studios, the online video giant and former home of Endemol Beyond president Will Keenan. Stars want to be on YouTube. Go figure.
What Else?
– Apple is working on a new version of Apple TV, the popular set top box that CEO Tim Cook has often referred to as a “hobby.” It’s a hobby no more, as Apple has granted the device its own section on its website. You can use Apple TV to watch HBO and play some games – but this is not the big surprise some investors want to see from Apple.
– Kate McLean, president of social celeb marketer theAudience, has left the company on the eve of a big Sunday. The company is helping three brands with Super Bowl ads.
– Box, a cloud storage company used by Hollywood studios and several other major companies, is going public.
– Former Hulu CEO Jason Kilar is building his new company. It’s a Hulu for magazines.