Google and HTC have entered into a “definitive agreement.” Rumors had been circulating that Google was in the process of preparing to acquire HTC’s mobile business and athough that is not quite what has been announced today, what has been confirmed is not too far from that.
Google and HTC have both confirmed by way of a joint announcement that Google will pay $1.1 billion to HTC and in return for that fee Google will gain non-exclusive rights to HTCs intellectual property, in addition to a number of employees who will be moving from HTC to Google. The last point is of particular interest as the announcement details that Google is picking up employees who are already (or have been) working with Google and the Pixel smartphone brand. So while one is not acquiring the other in straightforward terms, it is acquiring what it needs to progress its smartphone ambitions. A point that is directly made in the announcement with Google confirming that the agreement highlights Google’s commitment to its smartphone business by firstly taking on the talent it needs to further the business, and secondly, gaining access to intellectual property which can be used in current and future Pixel smartphones and devices. While for HTC, the announcement explains that this agreement is in line with the company’s general focus on streamlining its business while continuing to focus on areas that it has already made commitments to, such as its Vive VR business, AR, and the Internet of Things. The announcement even goes on to state that HTC will continue to bring smartphones to market and is currently working on a successor to the HTC U11.
While Google is not outright purchasing HTC’s mobile business, it is taking on the sum of the team who have been working on the Pixel smartphone brand since its inception. It has long been understood that HTC was the silent manufacturer behind the original Pixel and the Pixel XL, and it is believed that HTC is once again the silent manufacturer behind one of the upcoming Pixel 2 smartphones. So what Google is in essence doing is now bringing together that team who has worked on the Pixel brand over the two years to create the backbone of what will be the Pixel brand going forward. Coupled with the rights to use some of HTC’s mobile-focused intellectual property.