x PhoneArena is looking for new authors! To view all available positions, click here.
  • Home
  • News
  • Did you know that Google spent just $50 million to buy Android?

Did you know that Google spent just $50 million to buy Android?

Posted: , by Victor H.

Tags:

Did you know that Google spent just $50 million to buy Android?
Looking at how companies spend billions of dollars nowadays, you might think that back in 2005, when Google acquired the Android start-up, it would have spent no less than a fortune on it. After all, today’s realities show how companies like Facebook are ready to spend $19 billion for an instant messenger app like Whatsapp and over $2 billion for a Kickstarter project like the Occulus Rift. Surely, Android would have cost Google no less, you might think.

Turns out, though, it did not. We've already told you the story about how Android’s co-founder Andy Rubin started working on an operating system for digital cameras, but later on changed the project to target mobile phones, and that’s how Android was born. A year or so after the start of the project, Rubin, ran out of money, and started looking for funds at big companies like Samsung and Google.

After being laughed out of court at his first visit in Korea by Samsung top executives, he had scheduled a meeting with Google’s Larry Page. Over at Mountain View, Rubin started with a vigorous pitch, showing Page slides to illustrate how the 700-million-unit phone market is more than triple the size of the traditional computer market, and how that gap is only growing.

It did not take long to convince Page. Instead of getting funding for Android, though, Rubin was met with a surprising proposition - Google wanted to buy Android right away. The interesting part, however, is the price both parties agreed on: merely $50 million (plus incentives).

Google wanted to buy Android right away

At the time, this bought Google the talented, but still very small Android team. Rubin co-founded the project with 7 other engineers, and by the summer of 2005, they were all under Google’s inviting wing. Best of all, they were not limited in their spending budget. Almost immediately after the purchase, Google shelled out over $10 million to back up the Android effort with patents. 

From there on, it’s all history, but fact is that now, Android is the world’s most popular operating system, with a commanding market share of over 80%. Not bad for a company that Google bought for $50 million, is it?

Android co-founder Andy Rubin (on the left) and Google's Larry Page

Android co-founder Andy Rubin (on the left) and Google's Larry Page


reference: Dogfight

28 Comments
  • Options
    Close




posted on 25 Apr 2014, 08:03 3

1. akki20892 (Posts: 3237; Member since: 04 Feb 2013)


I didn't know.

posted on 25 Apr 2014, 08:12 5

4. sgodsell (Posts: 882; Member since: 16 Mar 2013)


I wonder if Google was going to say sell it. How much do you think Google could get for Android today?
So many companies use Android, like all the phone OEMS, Amazon, even Microsoft is using a form of it.

posted on 25 Apr 2014, 08:14 2

5. akki20892 (Posts: 3237; Member since: 04 Feb 2013)


Googolplex

posted on 25 Apr 2014, 15:09 1

20. sipha (Posts: 249; Member since: 12 May 2012)


Samsung would willing pay $20 billion no doubt.

posted on 25 Apr 2014, 22:36 1

24. express77 (unregistered)


Whatsapp sold for 19 billion. Android is more than 100 billion probably. But it is open source and free.

posted on 26 Apr 2014, 00:14

27. sipha (Posts: 249; Member since: 12 May 2012)


19 billion for whatsapp is just extraordinary stupidity by facebook.. You cant realy apply that methology in realy life!!

posted on 25 Apr 2014, 16:23 1

22. Finalflash (Posts: 1429; Member since: 23 Jul 2013)


It is open source, they can't sell it at all. Selling it would open them up to 20 different lawsuits from 30 different trolls, the largest of which would include Apple and MS.

posted on 25 Apr 2014, 22:38

25. express77 (unregistered)


" Selling it would open them up to 20 different lawsuits from '30 different trolls'., the largest of which would include Apple and MS."
LOL. +1 Dude.

posted on 25 Apr 2014, 10:59 1

14. ScottSchneider (Posts: 312; Member since: 06 Dec 2011)


Oh... I thought they bought whatsapp for $19billion... Android too...!!!

posted on 25 Apr 2014, 13:51

18. Ashoaib (Posts: 1212; Member since: 15 Nov 2013)


Thats called a throw away price

posted on 25 Apr 2014, 08:04

2. sip1995 (Posts: 639; Member since: 07 Feb 2014)


yes...i knew it.

posted on 25 Apr 2014, 08:09 2

3. KillerKeyboard (Posts: 302; Member since: 21 Nov 2013)


Lots of dyks lately.

posted on 25 Apr 2014, 08:22 1

6. shimshim (Posts: 18; Member since: 04 Jul 2012)


i bought my pjs for 15 dollar. did you know?

posted on 25 Apr 2014, 08:25 1

7. QuadFace (Posts: 47; Member since: 19 Aug 2013)


But the cash was to come from Samsung

posted on 25 Apr 2014, 08:47 5

8. sgodsell (Posts: 882; Member since: 16 Mar 2013)


Samsung didn't want Android. In 2005 the mobile market was dominated by feature phones running java (j2me). Smart phones were very expensive and didn't do much at that time. Blackberry and Pocket PCs were on the rise. From 2005 - 2008 it was still anyone's game. Apple surprised itself and everyone when it sold as many phones as it did in 2007. In 2008 is when everyone started to hear about Android. Google released Android and made it free for OEMs like Samsung and others. Samsung was also working on releasing its own OS at the time, Bada. Which didn't go very far.

posted on 25 Apr 2014, 09:06

9. arenanew (Posts: 132; Member since: 30 Dec 2013)


waste and poor os i ever use if some one sell in 1 $ also . every year they pay 3 billion dollar to microsoft . made by ametured people . half baked os

posted on 26 Apr 2014, 03:06

28. SamDroid (Posts: 114; Member since: 14 Dec 2013)


Half-baked.....
Do you even know what you're talking about?

posted on 25 Apr 2014, 09:22 1

10. aries.phills (Posts: 132; Member since: 17 May 2011)


Having an eye for the next big thing (That's investment security).
The out-right purchase of Android might end up being Larry's best business decision ever.
Even uneducated folks would agree.

posted on 25 Apr 2014, 09:34

11. aries.phills (Posts: 132; Member since: 17 May 2011)


Now, I wish I could purchase phonearena for $25M.
Surely, I know it's a smart investment.

posted on 25 Apr 2014, 09:40 1

12. boosook (Posts: 894; Member since: 19 Nov 2012)


The point is that Android would never have become what it is today without google's search, services and apps. So let's not overestimate the value of the former Android company… they made the shell that google filled with its services. A good shell, indeed, but useless without the added value of gmail, gmaps and ao on.

posted on 25 Apr 2014, 10:04 1

13. PBXtech (Posts: 966; Member since: 21 Oct 2013)


Mobile competition in 2005 =/= mobile competition in 2014. The rise of the smartphones also created the rise in $ needed to purchase software for each operating system. And the more they spend, the more is expected.

posted on 25 Apr 2014, 14:13

19. ErenJaeger (Posts: 114; Member since: 22 Apr 2014)


Also in my perspective, it's like how artists don't spend millions on their materials but how they use it can eventually earn them millions because of their creativity and effort. I'm pretty sure android was crap in the beginning but lots of effort made them valuable. Kinda not interesting news to me.

posted on 25 Apr 2014, 11:01

15. jroc74 (Posts: 4720; Member since: 30 Dec 2010)


That looks like one hell of an investment....and a cheap one today.

posted on 25 Apr 2014, 15:18

21. mrblah (Posts: 393; Member since: 22 Jan 2013)


Look at those two gross copy cats, rich for stealing. They should get life in prison.

posted on 25 Apr 2014, 19:20 1

23. roscuthiii (Posts: 1785; Member since: 18 Jul 2010)


A much better DYK than the normal fare of, "Did you know Android phones have a power button... standard?"

posted on 25 Apr 2014, 22:39

26. express77 (unregistered)


Android is becoming closed and start showing limitations day by day. This is not good.

* Some comments have been hidden, because they don't meet the discussions rules.

Want to comment? Please login or register.

Latest stories