In general, it is shortsighted to acquire companies as a defensive move to prevent rival organizations from gaining access to certain patents, technology, or customer bases.

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Sometimes firms may acquire promising startups not only to gain access to a new capability or competency, but also to preempt rivals from doing so. For example, Google bought Motorola's cell phone unit for $12.5 billion in 2011. This was done to gain access to Motorola's valuable patent holdings in mobile technology. Google later sold the cell phone unit to Lenovo, while retaining Motorola's patents.

In General, It Is Shortsighted to Acquire Companies as a Defensive