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Google's $12.5 billion acquisition of Motorola Mobilitygives the Internet search company patent protection while putting it squarely into the smartphone hardware business, Executive Chairman Eric Schmidt told CNBC Monday.
But the acquisition won't affect how Google does business with the other phone makers that use its Android operating system, including HTC, he added.
"We are going into the hardware business, but we’re going to keep it separate and we’re going to treat everybody else on a fair basis," he explained.
Android has had more than 550,000 activations a day and is succeeding "precisely because there are so many partners," he said. "If we somehow p--- them off ... it would be a disaster to the Android strategy."
Google is also taking advantage of Motorola Mobility's 17,000+ patents, a portfolio Schmidt called "second to none" at a time when Google faces "significant patent challenges from people who want to stop our products."
Schmidt said he supports the overhaul to the U.S. patent system President Obama signed into law Friday but said it doesn't go far enough.
"We still have a problem where too many overbroad patents are used to shut down other companies," stifling the startups that don't have the resources Google has to buy a patent-rich company like Motorola Mobility.
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