By now, you doubtless know all about Google's acquisition of Motorola Mobility, a move that turns the search giant into a full-fledged player in the smartphone manufacturing market. But while this deal has many upsides for Google - a defensive shield against patent lawsuits, control over the Android ecosystem from software to hardware - there's one major, overriding downside.
With the purchase of Motorola Mobility, Google may well have made itself an even riper target for the Federal Trade Commission's ongoing antitrust investigation. And that's not even mentioning the lawsuits Google could face from jilted Android handset manufacturers.
Rewind back to last week, when we heard reports that the FTC was broadening its probe of Google's business practices to include Android.
The goal of the expanded probe: to find out whether or not the company was throwing its weight around and preventing its Android manufacturer partners from adopting competitors' services - which could simply refer to mapping applications, or it could be about rival mobile operating systems like Microsoft Windows Phone 7.
If that's true, then Google-Motorola just alienated Samsung, HTC, and any other Android partner that the company applied pressure to. After all, in this hypothetical scenario, Google likely promised them a level playing field and the full support of the Googleplex in exchange for their cooperation. But there's no guarantee that Google won't pull the Android rug out from under them now that it has Motorola Mobility to grant total control.
While Google has publicly reaffirmed its commitment to these smartphone partners in the wake of the deal, saying that Motorola will get no special treatment from the Android team, I imagine there are escape plans being formulated in manufacturer boardrooms across the world. There may even be a lawsuit or two levied for deceptive or anticompetitive business practices.
In short, Google isn't making itself any friends with the Motorola acquisition, despite initial appearances, and thinking through the scenario I described is likely keeping teams of regulators busy as we speak.
And even if the FTC investigation of Google's Android business practices comes to nothing, the Motorola Mobility acquisition still leaves Google on the hook. Google Android already commands 39 percent of the smartphone market, ahead of even Apple, a fact largely attributed to the company's practice of giving away the operating system to recoup costs on search and mobile ads.
Regulators were already concerned with the idea that Android forced users to use Google services, as we've already seen. The fact that Google itself will now be ultimately behind the hardware that many consumers will end up using is only going to make those same regulators that much more determined to leave no stone unturned.
Google may have spent $12.5 billion on Motorola, but it's only going to make the legal scrutiny around its business that much more intense. No matter the details, many are going to see this move as Google reinforcing its position at the top of the heap, and I have no doubt that the FTC will be looking deeply into the consequences to make sure that every single aspect is on the level.
Essentially, the short-term, possibly reactionary decision to acquire Motorola and its patents to fend off legal action may have longer-term consequences for Google as a whole. And come the start of antitrust hearings on September 21st, Google will have to prove it's not a competition-stifling monopolist even as behind the scenes it works to integrate Motorola into its business.