Google is a step closer to buying Motorola Mobility

Google Inc. may be on the verge of closing the biggest deal in its 13-year history — a $12.5-billion acquisition of Motorola Mobility that could greatly escalate its competition with Apple Inc.

The deal, which has been approved by U.S. and European antitrust regulators, would bring Google significantly closer to manufacturing phones, tablet computers, home entertainment systems and other consumer devices.

Although officials in Washington and Brussels concluded that the Motorola deal would not stifle competition, U.S. and European regulators warned they would monitor to make sure it doesn't.

"The division will not hesitate to take appropriate enforcement action to stop" anti-competitive behavior, the U.S. Justice Department said in a statement Monday.

A Google spokeswoman said that the company hopes to complete the deal early next year. It still has to clear regulatory hurdles in China, Taiwan and Israel.

Google is looking to Motorola's more than 17,000 patents to help shield it in the escalating patent battles surrounding its Android operating system. There is growing concern that patent holders are increasingly using their portfolios as bludgeons to stop other companies from using smartphone technology.

The pairing could benefit both companies. Motorola Mobility has struggled to keep up with Apple's iPhone and smartphones from other rivals such as Samsung Electronics Co. And Google aims to get its search and other services on as many devices and in as many consumers' hands as possible, said BGC Partners analyst Colin Gillis.

"What this means: Get ready for inexpensive hardware," Gillis said. "Google is about to chase a whole new business model.

"It's going to get hardware out to consumers at low to no cost and make it up in services, because the only way to beat Apple is on price."

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