Googles Big Buy

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Tuesday, August 16, 2011 - 10:39am

Google announces plan to purchase Motorola Mobility for $12 billion.

Google is buying cell phone maker Motorola Mobility.

The internet giant is spending $12.5 billion to acquire the company that builds many of its Android phones.

Google executives say the move will give the Android system a serious boost in the competitive smart phone market.

CNBC's Jon Fortt says the deal is as much about patents as making phones.

Google's trying to fend off a series of a series of legal challenges from the likes of Apple and Microsoft related to Android operating system, but the purchase of Motorola provides some legal ammunition.

"Google can bring in its 17,000 patents, and protect its ecosystem a little bit better. This should provide Google with a little more room to punch harder in those mobile wars going forward," Fortt explains.

The deal calls for Google to pay $40 per share for Motorola Mobility, almost $15 per share over the stock's closing price Friday.
 

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