$ 1.1 billion for HTC talent buyer Google Gain Loses situation.

Google announced late Wednesday about its spending $1.1 billion to hire a team of an engineer from smartphone business of struggling Taiwanese manufacturer HTC. Though the deal will not involve the purchase of direct stake and HTC will continue to run smartphone business. Google will buy part of HTC corps’ engineers and design teams to bolster the US internet giant developing hardware business. The company announced Alphabet Inc.’ of Google is taking HTC only employees which have worked on its signature Pixel.

IT would not be for the first time that Google into forays hardware, 2012 it acquired handset maker Motorola for $12.5 billion only to sell it later in 2years for less than$ 3billlion.So it’s time to see what Google makes of this deal. In Google tight reign and control over the production of its Pixel smartphone and another device which in turn will help the sale, its view in forwarding in the deal. As gadget is becoming the pillar of Google strategic push to distribute critical software product like its voice enable assistant and better compete with Apple Inc. New buzz and hush are that search giant is preparing to unveil the second generation of the device in October building portfolio that runs from its Google home speaker to daydreams.

Alphabet investor may be bit concern on as history repeats itself as 2012 paid $12.5b for Motorola Mobility then was one of the leading Android handset manufacturers and in less than 3years Google sold it to Lenovo group LTD. For less than $3 b through it kept Motorola’s Valuable Patent portfolio owing Motorola had eroded Google profit margin and stakes were high as other phone makers relied on its Android software. However, HTC Transition is much lower cost at a very different time when Google and its biggest rival are focused on consumer device built around new Artificial intelligence and Augmented reality services (AR) . As this AR demand powerful expensive camera and sensor working in sync. With software that can process and supervise 3-D images on the real world scene. When compared to Apple which easily picks one set of AR hardware to match to its software, it difficult task for Google who had a different Android partner making their own phone with different components.

Senior vice president of hardware Rick Osterloh relayed in the blog post that “it still early for Google hardware business .We are focused on building our core capabilities. And a team of HTC talent will join Google as part of Hardware organisation. These future fellow google’s are amazing folks we have already been working with closely on Pixel smartphone line and we’re excited to use what we can do together as one team.

As Google has also already launched it win phone so Android phone maker has gotten used to their partner being a rival. The HTC production resources which already involve making the first Pixel device and has the key to Nexus line may support existing phone operations. Now here more control over hardware production would also give Google more control over the distribution of new services for eg; voice-based digital assistant. Google tech giant had struggled afar bit to get handset makers and carriers to ship Android devices with latest security software. As Pixel is far from the top-selling phone was designed in part to prompt another Android phone maker, to push out these update faster. Still, some Android partner is moving ahead with competing for software effort-Huawei linked up to Amazon assistant and Samsung has its own.

Google facing problem as external estimate sale of Pixel peg at 552,000 units during the first quarter. However, it continues selling Pixel has aside benefited for Google chief was to boost primary sale. With each Pixel Phone, it moves  Google  doles out less in traffic acquisition cost , it pays money to partners like Apple and carrier to install Google search services in recent time this cost has risen steadily. An HTC acquisition and larger Google hardware unit could hurt the company’s profit margins, Sheridan a UBS analyst warned.