Google's $12 Billion Toy

Here's a business riddle: Divine Google intentions for its largest-ever acquisition, the $12.5 billion purchase of the once-great, now-faltering Motorola Mobility. Motorola represents one of the thorniest strategic and operational challenges in Google's 14-year history. Oddly, few seem to be paying attention.

What will happen to Motorola’s 20,500 employees? What of the factories churning out low-margin cellphones and cable-TV boxes? What of the five years of losses, some $5.3 billion in all? With Google stock down 3% year to date, compared with a 15% rise for the Nasdaq Composite, it seems logical that Google might just sell off these metal-bending headaches and focus on its strength—spreading mobile Web search around the world. So, it's gut-check time. Does Google sincerely want to be a company that makes actual stuff? The disquieting answer is that there appears to be no sense that a choice is even required.