Google acquiring Motorola Mobility for $12.5 billion

For the last few months Patent war between Google’s Android and Apple is roaring so loudly that every mobile manufacturer can feel the heat. Google bought 1000 patents from IBM only a few days ago and now they are more powerful in mobile field than ever. At a price of $40 per share for a total of about $12.5 billion, Google has announced it's going to acquire Motorola Mobility. The Mountain View-based company plans to use Motorola's 80-years rich patent portfolio to help its Android platform in the numerous legal battles it's currently fighting, while Motorola itself should continue to function as before.

The first thing that should be noted is Motorola Mobility is not the entire Motorola. You might remember that the company split in two in January 2010 - Motorola Solution (being the direct successor of Motorola) and Motorola Mobility (a spin-off company handling the mobile devices business). Google is buying Motorola's mobile division responsible for smartphones and tablets. The reason for the move is quite simple - to defend Android in the ongoing patent war.

A few days ago Google explained that Microsoft, Apple and other corporations are working together to acquire important patents before Google so they can get licensing fees of up to $15 from the manufacturers for each Android device sold.

So, now that Google owns Motorola. It is in a much better position to offer assistance to its partners in their court struggles. After all, Motorola is one of the companies with the largest patent portfolios in business and we are led to believe the whole Android community will have access to it once the deal is done.
Google does not plan a merger and will run Motorola as a completely separate business. While this will of course strengthen the ties between hardware and software, Google is pledging to continue offering Android as an open platform, Motorola will license it and others will be able to as ever. Additionally, Google will continue to operate its new toy as a separate business and not morph it into an in-house hardware wing.
google-motorola contract details
Larry Page had this to say about the deal on Google Blog:
Motorola has a history of over 80 years of innovation in communications technology and products, and in the development of intellectual property, which have helped drive the remarkable revolution in mobile computing we are all enjoying today… In 2008, Motorola bet big on Android as the sole operating system across all of its smartphone devices. It was a smart bet and we’re thrilled at the success they’ve achieved so far… Motorola’s total commitment to Android in mobile devices is one of many reasons that there is a natural fit between our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers everywhere.
Here are the reactions of other companies using Android-
J.K. Shin, President, Samsung, Mobile Communications Division
We welcome today's news, which demonstrates Google's deep commitment to defending Android, its partners, and the ecosystem.

Peter Chou, CEO, HTC
We welcome the news of today's acquisition, which demonstrates that Google is deeply committed to defending Android, its partners, and the entire ecosystem.

Bert Nordberg, President & CEO, Sony Ericsson
I welcome Google's commitment to defending Android and its partners.

Jong-Seok Park, President & CEO, LG
We welcome Google's commitment to defending Android and its partners.
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