Nortel Completes Sale of Patents to Apple, Microsoft Group

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The Nortel PieNortel announced on Friday that it has officially completed the sale of some 6,000 patents to the consortium of companies that won them in an auction earlier in July. Those companies are Apple, EMC, Ericsson, Microsoft, Research In Motion and Sony, and are most significantly not Google.

The company’s announcement didn’t include any new details, but the sale had been wending its way through the regulatory process in Canada, a process that has apparently concluded with the six companies walking away with their patent booty.

Apple, Microsoft, and the other companies were believed to be interested in the patents to both boost their own patent portfolios, and to keep Google from being able to jump-start its own portfolio. The battle between Apple and Google (through hardware makers as proxies) and between Microsoft and Google has so far favored Apple and Microsoft, who have much broader patent portfolios than Google.

The patents cover an array of technologies from so-called 4G Long Term Evolution (LTE) and other wireless-related technologies, to networking, to voice and data transmission, to optical, and even semiconductors. The winners will now have both increased opportunities for generating licensing fees and added weight in the patent wars already being fought.

The consortium, which was named Rockstar Bidco, paid a combined total of US$4.5 billion, $2 billion of which came from Apple, according to Robert X. Cringely. Research In Motion and Ericsson put up $1.1 billion, Microsoft and Sony put up another billion, while EMC put up $400 million.

What’s not clear is which company gets which patents, or if there are cross-licensing deals included in the creation of Rockstar Bidco. That will probably take some time to find its way into public knowledge.

Comments

ibuck

Yes, it should be interesting to see how this plays out. If Rockstar Bidco holds the patents and allows use by all consortium members (while charging license fees to others), what happens if one of the consortium members (e.g., RIM) is acquired by others (e.g. Google)?

Or would it be better to divide them up and have cross-licensing deals among members? Does doing that establish a level of licensing fees that may then apply, after the “customary” litigation, to others, like Google?

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