Google Invests $12.5 Billion (!) in War With Apple’s iPhone as Google Buys Motorola Mobility

Aug 15, 2011  •  Post A Comment

Google dropped a bombshell on the mobile telephone business today, buying communications company Motorola Mobility for $12.5 billion, Digital Trends reports. The move is seen as part of a strategy to protect Google’s Android operating system.

"Google sees the need to arm itself with its own in-house device brand to compete effectively with Apple and create an iconic device line like the iPhone,” said Sharon Armbrust, senior analyst with SNL Kagan. “The big premium speaks to the importance of the acquisition to Google and to the job that [Motorola CEO Sanjay] Jha has done in turning Motorola around. Microsoft has already linked arms with Nokia and before that it was using HTC as its stalking horse. We may see an acquisition by MSFT coming up as well."

In a press release, Google said: “The acquisition of Motorola Mobility, a dedicated Android partner, will enable Google to supercharge the Android ecosystem and will enhance competition in mobile computing. Motorola Mobility will remain a licensee of Android and Android will remain open. Google will run Motorola Mobility as a separate business.”

On a conference call today about the acquisition, Google’s chief legal counsel, David Drummond, added: “While I’m not prepped to talk strategies, combining with Motorola and having that portfolio to protect the ecosystem is a good thing.”

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