Google's Brilliant, Money-Losing Motorola Deal

Google Inc.'s $2.9 billion deal to sell the hardware business of phone maker Motorola Mobility, a company it bought for $12.5 billion two years ago, is being described by some as a sign of failure. Is it?

True, there's a lot that looks silly now about Google's effort to enter the mobile-handset market. Instead of making phones itself, Google could have stuck to licensing its software to phone makers -- a strategy that worked well at Microsoft Corp. under Bill Gates, when the company achieved global dominance by licensing its operating system rather than trying to make personal computers of its own. Competing against big phone manufacturers such as Samsung Electronics Co. Ltd., HTC Corp. and Sony Corp., all faithful users of Google's Android operating system, probably wasn't a good idea. The smartphone market may be too mature for Google to make a difference. As Chief Executive Larry Page wrote on the company blog, the market is "super competitive, and to thrive it helps to be all-in when it comes to making mobile devices."