Google teams up with HTC in $1.1bn deal

Google has announced it has struck a deal with HTC to take control of part of the Taiwanese tech giant’s smartphone operation.

According to BBC News, the tie-up is has been settled for $1.1bn (£822m) and will see 2,000 employees from HTC’s smartphone division move to Silicon Valley.

However, the website says: “Google will not take a stake in the firm,” but will instead “receive a non-exclusive license for HTC's intellectual property.”

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The search giant said the HTC engineers heading to Silicon Valley 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”.

Cher Wang, HTC’s chief executive, said: “This agreement is a brilliant next step in our long-standing partnership, enabling Google to supercharge their hardware business while ensuring continued innovation within our HTC smartphone and VIVE virtual reality businesses.”

It’s not the first time Google has made a “big purchase involving a smartphone manufacturer”, says The Verge – the company bought US tech firm Motorola Mobility for $12.6bn (£9.3bn) in 2011.

That partnership saw the construction of a manufacturing plant in the US and “offered unrivalled customisation options for its flagship Moto X smartphone”, the website says.

But, by 2014 “Google had soured on its Motorola acquisition and reached a deal to sell the company off to Lenovo for a fraction of what it had originally paid”, adds The Verge.

As the transaction is “subject to regulatory approvals and customary closing conditions”, HTC says its deal with Google won’t come into effect until early next year.