Israeli financial news website TheMarker said Google paid $25 million for LabPixies, which develops gadgets ranging from calendars, news feeds and to-do lists to entertainment and games.

LabPixies is one of the first developers of personalised Web gadgets for Google's iGoogle and Android software applications and for iPhone, which is made by Apple Inc (AAPL.O).

iGoogle uses the OpenSocial foundation for applications. That's also used by Yahoo, Hi5, MySpace, and Orkut, meaning that OpenSocial gadgets will run on all those social-networking services. LabPixies also develops applications that run on Facebook's platform. Google launched iGoogle in 2005 and has been gradually improving it since then.  

"One of the first developers to create gadgets for iGoogle was Labpixies. Over the years, we worked closely together on a variety of projects, including the launch of a number of global OpenSocial based gadgets," said iGoogle team member Don Loeb in the blog post. "Recently, we decided that we could do more if we were part of the same team, and as such, we're thrilled to announce the acquisition of LabPixies."