Nortel Patents Sell For $4.5 Billion To Apple And RIM
Six-thousand patents and patent applications have been put up for sale by Nortel, the former telecom giant which filed for bankruptcy two years ago. The potential treasure trove has been purchased by a group including Apple and Research In Motion paying $4.5 billion to snatch Nortel Networks’ patents from under the noses of Google and Intel, Reuters is reporting.
The price was about three times what had been expected, highlighting the value of intellectual property in the fast-changing telecoms world, where established players are seeking to keep out newer rivals.
“The size and dollar value for this transaction is unprecedented, as was the significant interest in the portfolio among major companies around the world,” said Nortel’s chief strategy officer and president of business units George Riedel.
The winning group which also includes Microsoft EMC, Ericsson and Sony, are expected to share the patents to maximize their scope to pursue patent litigation, although no details were disclosed.
“We believe the consortium is in the best position to utilize the patents in a manner that will be favorable to the industry long term,” Swedish telecoms gear maker Ericsson said in a statement.
Google had expected to be the auction winner with a $900 million stalking-horse bid announced in April, but will now continue to have a handicapped patent portfolio compared with other telecom rivals and will now be more vulnerable to lawsuits from the auction winners.
Legal battles have been raging throughout the courts system in recent years as long-established incumbents try to protect their position against newcomers.
Research In Motion, maker of the BlackBerry smartphone, will cover about $770 million for its share of the patents, the Ontario-based company said in a statement. Ericsson will pay $340 million, Bloomberg News reports.
The patents changing hands include wireless, wireless 4G, data networking, optical, voice, Internet and semiconductor technologies. The most prized relate to emerging 4G standards such as long-term evolution (LTE).
The sale is still subject to Canadian and US court approvals that will be sought at a joint hearing expected to be held on July 11, Nortel said.
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