So why did Google pay $12.5 billion for Motorola?

This morning’s Observer column.

Last month, there was much hullabaloo because Nortel, a bankrupt Canadian telecommunications manufacturer, put its hoard of 6,000 wireless patents and patent applications up for auction. The scent attracted a herd of corporate mastodons – Apple, Microsoft, RIM, EMC, Ericsson and Sony – which eventually won the auction with a $4.5bn joint bid.

This attracted much attention from the commentariat, which interpreted it as a slap in the eye for Google, perceived as a rogue participant because it had made a series of apparently fatuous bids for the patents. At one point, for example, Google bid $1,902,160,540. At another, its bid was $2,614,972,128. And when the herd’s bid reached $3bn, Google countered with $3.14159bn.

Commentators were baffled by these numbers until mathematicians came to the rescue. The bids were, in fact, celebrated constants in number theory. The first is Brun’s constant, the number towards which the sum of the reciprocals of twin primes converge. The second was the Meissel-Mertens constant (which also involves prime numbers). And the third, as every schoolboy knows, represented the first six digits of pi. At this point, the penny dropped. Perhaps the Google guys were playing silly buggers – but with a serious motive, namely to inflate the price that the herd would have to pay. And so it proved.

Then, last week, Google dropped a bombshell…

LATER: Steve Lohr has a good piece about the takeover in the NYT which starts from Nick Negroponte’s vision for the digital world as one where people will ship bits rather than atoms. Google has not real experience with retailing atoms, and its experiment with selling the Nexus One handset was a disaster — though the product itself was (and remains) nicer than most Android phones. One lesson of Android is that not having control over handset hardware can lead to disappointing (or even maddening) performance for users (as I found when trying to find an Android bar-code reader App that would work with the camera on my HTC handset). That’s the problem that Apple cracked by having tight control over both device software and hardware. So one question raised by Larry Page’s promise to “create amazing user experiences” is whether Google actually plans to replicate Apple’s seamless control with Motorola handsets? And, if so, what will other Android manufacturers make of that?