The rumors are true: Google and HTC are striking a deal.
Google is spending $1.1 billion on a deal that’ll see “certain HTC employees”, including many that worked on Google’s Pixel smartphones, joining Google. Google will also get a non-exclusive license for HTC intellectual property.
The deal is subject to regulatory approvals and closing conditions and is expected to close by early 2018.
To be clear, this news doesn’t mean that HTC is exiting the smartphone business. HTC says that the deal “supports HTC’s continued branded smartphone strategy” and that it will streamline its product portfolio for better operational efficiency and financial flexibility. HTC also teased that it’s got “best-in-class engineering talent” working on its next flagship smartphone.
HTC will also continue work on its Vive virtual reality business.
This is a big deal for both companies involved. For Google, it gains HTC employees with smartphone hardware experience, including people that it’s worked with on its own Pixel smartphones, as well as a license for HTC’s IP. On the other side, HTC is getting an infusion of cash. HTC’s smartphone business hasn’t been doing very well lately, with flagships like the U11 not selling in huge numbers, but this $1.1 billion from Google will help it to continue on in its smartphone and Vive efforts.