Google’s Motorola Acquisition Finalized: Layoffs Seem Imminent

by Matt Klassen on May 22, 2012

Google finally cleared the last of the many regulatory hurdles standing in the way of final approval of its acquisition of Motorola Mobility, with Chinese regulatory bodies approving the transaction over the weekend.  With Motorola Mobility today filing an 8-K form that officially notes the company will be closing in two days, this now marks the beginning of Google’s controversial foray into the mobile market.

But while analysts, Android partners, and mobile competitors wonder what the future of the mobile market will hold with Google now in the mix, it looks like Motorola Mobility employees may have their own uncertain future to worry about, as rumours of imminent layoffs have started to swirl.

According to a report from TechCrunch, upon acquisition Google will immediately begin a “listening tour” of Motorola, getting fresh eyes on Motorola’s corporate make-up and taking stock of what people actually do there. It is with that information, sources say, that Google will decide who stays and who goes.

Although both companies have remained silent over the possibility of restructuring, layoffs following acquisitions are certainly not unexpected, particularly from Google. Following its acquisition the online advertising company DoubleClick in 2008, for instance, the search engine giant announced layoffs of 40 percent of the company’s workforce (some 300 employees). While I wouldn’t expect the cuts at Motorola to be quite so deep (with a total workforce of 19,000) you can bet that Google will want to streamline its operations as soon as possible.

While it’s certainly lamentable that real people are the victims of corporate streamlining, it’s a reality of the business world, meaning that while I wish I could fault Google for what seems to be impending restructuring, it’s likely the same steps any company would take following a landmark acquisition.

Further, while layoffs are regrettable, it might not be such a bad thing for Motorola as a corporate entity, as the company has slipped in the mobile market, watching its revenues slide as it struggles to compete with other Android partners like Samsung and perennial market behemoths like Apple.

But again, this is all based on speculation derived from historical precedent, meaning that officially nothing has been said by either Google or Motorola on their plans going forward. In fact, as I’ve reported before, it might be just as likely that Google looks to offload some of Motorola’s assets, taking what it wants from the company and selling off the rest; meaning, at least for the short term, that jobs may actually stay intact.

Interestingly enough, however, the one little tidbit of solid information gleaned from the weekend announcement that all regulatory hurdles had been cleared came in the form of stipulations from the Chinese authorities demanding that Google’s Android platform remain free and open source for at least five years, going to show just how central that little green droid has become to the Chinese mobile market.

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