Part I. Why did Google buy and sell Motorola?

In Part I, I'm going to outline what happened and the basic whys. In Part II, I will delve into more analysis on the strategic thought and financial reasoning for these transactions.

What
Google acquired Motorola Mobility for $12.5 billion in August 2012 and sold it to Lenovo for $2.91 billion in January 2014.

Why buy
From Google's fact page, the two main benefits were:
1. Faster innovation through the marriage between Google's software expertise and Motorola's device advantage to develop better phones at lower prices.
2. Possession of Motorola's patent portfolio to manage competition in the Android ecosystem.
Larry Page, Google's co-founder, called the move "supercharging the Android ecosystem" through the two means described above.

Why sell
Larry Page breaks it down like this: the smartphone market is super competitive. You gotta be all-in to be the leader in making mobile devices. Google is seeking new opportunities in the emerging wearable and home markets. So distinct are these market dynamics from the smartphone business that Google felt Motorola would be better served by Lenovo, the largest PC manufacturer in the world, in order to better serve smartphone users and to concentrate Google's efforts in their new focus on smart Android devices.

In hindsight, there are far more reasons at play... 
By simply doing the math, Google appear to have lost $12.5 - $2.91 = a $9.5 billion loss. However, we need to look deeper to determine what value had been gained or lost beyond the dollars.

Check out my back-of-the-envelop bar chart and accompanying analysis in Part II (video included!) to see what Google had really lost and strategic benefits reaped from this recent transaction.