Google Buys HTC’s Pixel Team for $1.1 Billion

The agreement with the Taiwanese firm “further reinforces [Google's] commitment to smartphones and overall investment in its emerging hardware busi...
Matthew HellerSeptember 21, 2017

Google has agreed to pay HTC $1.1 billion to bring employees of the Taiwanese firm who work on Pixel smartphones under its roof as it seeks to build up its hardware business.

The deal covers about 2,000 engineers and technical staff employed in HTC’s mobile division. Google will also acquire a non-exclusive license for HTC intellectual property.

“The agreement is a testament to the decade-long strategic relationship between HTC and Google around the development of premium smartphones,” the companies said in a joint news release, adding that it “further reinforces [Google’s] commitment to smartphones and overall investment in its emerging hardware business.”

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HTC, which has a long history with Google and its Android operating system, manufactured both 2016 Pixels. The iPhone clones were designed by Google and marketed as Google devices.

The HTC staffers who will be joining Google “are amazing folks we’ve already been working with closely on the Pixel smartphone line, and we’re excited to see what we can do together as one team,” Rick Osterloh, Google’s hardware chief, wrote in a blog post.

In addition to Pixel, Google’s hardware ventures include Google Home, a voice-controlled speaker that allows users to look things up on its extensive search database and perform other tasks, and Google Daydream View, a virtual reality headset.

“We’re excited about the 2017 lineup, but even more inspired by what’s in store over the next five, 10, even 20 years,” Osterloh said.

Google previously invested in smartphone manufacturing by acquiring Motorola Mobility in 2012 for $12.5 billion, but that deal soured and Google sold Motorola to Lenovo in 2014 for a fraction of the price it originally paid.

According to The Verge, buying part of HTC’s mobile division means that Google will directly challenge Android partners including Samsung, LG, and Huawei, and “could bring Google closer to achieving the hardware/software synergy that has worked so well for Apple and the iPhone.”

HTC, which has lost hundreds of millions of dollars in recent years, said the agreement will give it “a more streamlined product portfolio, greater operational efficiency and financial flexibility.”