Google plans acquire Motorola Mobility Holdings, the cell phone business, for $12.5 billion in a move to strengthen its mobile business and position Google directly into the telecommunications hardware business.
The acquisition would turn Google, which makes the Android mobile operating system, into a full-fledged cell phone manufacturer, in direct competition with Apple.
Motorola manufactures phones that run on Google’s Android software. Android, launched in 2007, has become an increasingly important platform for Google, and is now used in more than 150 million devices, with 39 manufacturers.
Google has plans for its next strategic step in wireless. Google paid $4.5 billion for more than 1,000 patents from IBM. And Motorola holds more than 17,000 patents.
Its competitors Apple and Microsoft led a consortium of technology companies in a $4.5 billion purchase of roughly 6,000 patents from Nortel Networks.