Google is paying $US12.5 billion ($11.9 billion) to buy Motorola, its biggest-ever deal, as protection against legal challenges from Apple and other mobile rivals, analysts say.
The internet search leader is building up its patent portfolio - seen as one of the weakest in the industry - after it lost out to Apple, Microsoft and others in a recent auction of bankrupt Nortel's assets.
But in buying Motorola, the developer of Android - the leading smartphone software - risks alienating the 38 other phone makers that depend on Android to run their smartphones, according to analysts.
Google CEO Larry Page sought to reassure investors this would not happen, and phone makers including Samsung officially said they welcomed the deal as it will also help their legal battles.
"Motorola has a strong patent portfolio which will help protect Android from anti-competitive threats from Microsoft, Apple and other companies," Page said.
Page also explained that Motorola would be run as a separate company, licensing Android software in the same way as its rivals, which also include HTC and LG Electronics. Analysts saw the deal primarily as a way for Google to protect and build out its mobile business and questioned if it would continue manufacturing handsets in the long term.
"We don't think they necessarily want to be in the business. They want those patents first and foremost," said Brian Pitz, an analyst at UBS. "This is really a game of protection."
source : http://english.kompas.com/read/2011/08/16/06372184/Google.Splashes.USD12.Billion.on.Motorola