EU approves Google-Motorola Mobility acquisition
Linked by Thom Holwerda on Mon 13th Feb 2012 19:26 UTC
In the News The first big hurdle has been taken by Google and Motorola Mobility. The European Union has given the green light for Google to proceed with its acquisition of Motorola Mobility. The EU will, however, monitor the deal and its outcome for potential patent abuse. Update: And there we go, the US DoJ has approved the deal as well. Update II: The just-linked DoJ report also approves the Nortel patent sale to Apple, Microsoft, and RIM. I'm hoping for lots of fireworks here so the patent system blows up in Google's, Microsoft's and Apple's faces, so we can point and laugh about all the money they wasted.
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tanishaj
Member since:
2010-12-22

Why should regulatory bodies need to approve the merger, anyway? It should be no business of governments whether companies merge, collapse, or split, just in what they do with their market position. If Google goes completely mad with power after acquiring Motorola, then the governments of the countries they operate in should sanction them, but I don't see the point in potentially blocking the acquisition.


I guess the general feeling is that we have enough historical experience to say with relative certainty that elimination of all competition in an industry generally turns out badly for consumers. A market without competition is not really a "free market" and it is almost impossible for competitors to enter some markets once they are dominated by one or even just a few players.

Also, given how slow governments are to respond to after the fact consequences, you might argue that waiting until after companies start to behave egregiously is not effective in practice.

From a more cynical point of view, given the level of government influence that large companies seem to exert on political bodies, I am not sure how realistic it is to count on the government to sanction misbehaving companies anyway. I for one would rather get in front of the problem.

So, while I am normally a bit on an anti-regulatory guy, I think that this kind of scrutiny makes sense.

That said, sometimes there are just "natural" monopolies. For example, the break-ups of Standard Oil and AT&T have almost reversed themselves through natural market forces.

Perhaps technology changes fast enough that things would correct themselves more quickly in these industries. Still, in general, it seems like a good idea to scrutinize such things.

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