Why Google will Buy Bose

Rich Tehrani : Communications and Technology Blog - Tehrani.com
Rich Tehrani
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Why Google will Buy Bose

To compete effectively with Apple, Google needs to evolve how it does business. The most important area Google needs to worry about is the Android experience versus the one Apple provides. Apple does its very best to update the operating systems on even its most obsolete phones - ones going back years like the iPhone 5s. Android devices on the other hand seem to be designed to last a year or two - after that, depending on your phone, you're out of luck.

Basically, Apple worries about the experience, Google Android is more about a device.

Apple starts with the store and goes down to the processor level - they own it all.

Conversely, Android phones have numerous similar applications from the Android hardware maker and Google. Why two email apps? Why two browsers? This is just the way it is. Its a poor experience, all around.

But times they are-a-changing, again.

Google tried to become a hardware player when it purchased Motorola and the experiment didn't work out causing the company to sell the hardware business to Lenovo at a big loss.  

For its second try, the search company is spending 1.1 billion dollars to acquire 2,000 HTC staffers - not the whole company. Its technically a cooperation agreement. After all, why buy the cow...?

After partnering with HTC for years to build its devices, Google finally made the move to tie the knot - at least partially.

If however, the ultimate goal is to compete more effectively with Apple, Google needs stores, a premium brand name and an audio division to take on Beats and Apple's core experience drivers.

Hmm, what company has all these things? What company was keeping its consumer electronics prices at retail unlike most of its competitors? What company has been a master of marketing over the years? As a bonus question, what company even dabbled in automotive engineering?

If you guessed Bose, you either are a great guesser or you read headlines before the articles. 

Google will need to purchase Bose at some point and we predict it will happen in the next 24 months. They will need the whole company - or most of it to get the stores.

Why is this even more likely to happen? Today, Bose announced a headset with Google Assistant built-in. They could have used Alexa - in fact, that makes more sense as its a more ubiquitous platform. This move shows the interest Google has in such a partnership which if successful, will lead to a potential "liquidity transaction."

What do you think?

Update Nov 20th, 2017: A reader reached out to me to point out the founder of the company, Dr. Amar Bose gifted the majority of the company's shares to MIT. The transfer of non-voting shares makes it far less likely the company will be acquired. The goal seems to have been to ensure the company remains true to its roots of research and also gives back to MIT where Amar Bose was undergraduate, post-grad and teacher.

The next question worth asking is can an University be sold and the answer is increasingly yes in the UK and the US. Although it is tough to see MIT being sold.



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