Google Pays HTC $1.1 Billion for Transfer of Smartphone Division Employees

Google has reportedly reached a deal with HTC to acquire a number of employees in a $1.1 billion exchange that also includes licensing of HTC technology.

BetaNews reports that Google has reached a deal with HTC to purchase a number of the company’s mobile division team employees in a deal which pays HTC $1.1 billion. Rick Osterloh, Google’s hardware boss, wrote in a blog post “these future fellow Googlers 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,” he continued, “The deal also includes a non-exclusive license for HTC intellectual property.”

HTC’s Chief Financial Officer Peter Shen stated that the company would still continue to employ more than 2,000 research and design staffers after the mobile division transfer to Google, down from 4,000 employees. HTC will still continue to develop their own smartphones, CEO Cher Wang said that the deal with Google will  “ensure continued innovation within our HTC smartphone and Vive virtual reality business.” According to a press release, the company is “actively preparing” to release their next flagship smartphone.

This isn’t the first time Google has made a large purchase of a smartphone manufacturer, Google announced a $12.5 billion buyout of Motorola Mobility six year ago. “Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere,” said former CEO Larry Page at the time.

Google took a more hands-on approach to hardware development in 2016 with the launch of their flagship Android phones, the Pixel and Pixel XL. Both of these phones were manufactured by HTC despite the phones being designed by Google and advertised as Google devices. The purchase of HTC’s smartphone team will allow Google to directly challenge smartphone manufacturers like Samsung, LG and Huawei. Rick Osterloh who runs Google’s hardware division said, “We’re excited about the 2017 lineup, but even more inspired by what’s in store over the next five, 10, even 20 years,” said Osterloh. “Creating beautiful products that people rely on every single day is a journey, and we are investing for the long run.”

Google’s next lineup of hardware includes the Pixel 2, Pixel 2 XL which will be manufactured by LG, Google Home Mini, and the Pixelbook.