Google has moved into the hardware market after striking a deal to buy Motorola’s handset division, Motorola Mobility.
The reported £7.65bn deal – Google's biggest ever – is expected to be sealed by the end of this year, or early 2012.
Google CEO Larry Page said the acquisition will help Google boost the Android ecosystem. He added that Motorola Mobility will remain a licensee of Android and Android will remain open, with Mobility run as a separate entity.
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Sanjay Jha, CEO of Motorola Mobility, said: "This transaction offers significant value for Motorola Mobility's stockholders and provides compelling new opportunities for our employees, customers and partners around the world.”
Andy Rubin, senior vice-president of Mobile at Google, said: "We expect that this combination will enable us to break new ground for the Android ecosystem. However, our vision for Android is unchanged and Google remains firmly committed to Android as an open platform and a vibrant open source community. We will continue to work with all of our valued Android partners to develop and distribute innovative Android-powered devices."
Ovum analyst Nick Dillon does not believe it is just about hardware. "Having been outbid in the recent sell-off of Nortel’s patent portfolio, Google was clearly willing to look elsewhere to build up its arsenal of IP [intellectual property] and in the light of the growing number of IP legal disputes in the smartphone market; this move will put Google in a stronger position competitively."