Google Will Acquire Motorola to Enhance Competition, Gain Patents

August 15th, 2011 · 9 notes · #apple #iphone #ios #google #android #htc #motorla #droid

Google announced via their investor relations page that the company has agreed to terms with Motorola for a $12.5 billion dollar acquisition at 60% premium. The boards of directors of both companies unanimously approved the transaction. 

The deal puts Google head-to-toe with Apple, who has been a full-fledged smartphone manufacturer since they launched iPhone and iPhone OS in 2007. The acquisition of a handset maker is not an automatic win for Google, as they closed down their Nexus One store due to sub-par sales. A Motorola deal will put more of Google’s phones on shelves, but it also puts the search-engine company in competition with HTC and Samsung. 

“Motorola Mobility’s total commitment to Android has created a natural fit for our two companies. Together, we will create amazing user experiences that supercharge the entire Android ecosystem for the benefit of consumers, partners and developers,” Google’s Co-founder and CEO, Larry Page, said in a press release.

Google will benefit greatly from Motorola’s 17,000 patents on phone technology, as Google recently lost in a consortium against Microsoft, Apple and RIM for thousands of patents from Novell and Nortel Networks, a Canadian computer-networking company and a telecom manufacturer. 

Googles stock (GOOG) closed down 1.82% at $553.50. You can view a video of CNBC analysts discussing the deal here.