Tech Giants Unite: Apple, RIM, and Microsoft Lead $4.5 Billion Auction for Nortel's Patent Portfolio

Strategic Insights -

A consortium of six major technology companies, including Apple Inc, Research In Motion (RIM), and Microsoft Corp, has emerged victorious in a hotly contested auction for Nortel Networks Corp's remaining patent portfolio. The $4.5 billion sale includes over 6,000 patents and patent applications spanning various technologies, with a focus on mobile broadband and 4G standards. This acquisition marks a significant shift in the increasingly litigious mobile industry, where major companies are vying for control of key patents to protect their interests.

Key Takeaways:

  • The winning consortium of six companies includes Apple Inc, Research In Motion (RIM), Microsoft Corp, EMC Corp, Sweden's Ericsson, and Sony Corp.
  • The sale includes over 6,000 patents and patent applications, with a focus on mobile broadband and 4G standards.
  • The most prized patents relate to long-term evolution (LTE) technology, a key component of emerging 4G standards.
  • Google and Intel were among the notable losers in the auction, with Google opening the bidding at $900 million in April.
  • RIM's portion of the purchase consideration amounts to around $770 million, while Ericsson paid $340 million.
  • The sale is subject to Canadian and US court approvals, with a joint hearing expected to be held on July 11.

Statistics:

  • $4.5 billion: The sale price of Nortel's remaining patent portfolio.
  • 6,000+: The number of patents and patent applications included in the sale.
  • $900 million: The initial bidding price set by Google in April.
  • $770 million: RIM's portion of the purchase consideration.
  • $340 million: Ericsson's portion of the purchase consideration.
  • 2011: The year Nortel obtained a court order to further extend the stay of proceedings under the Companies' Creditors Arrangement Act (CCAA).
  • 14: The date (December) that Nortel's stay of proceedings is set to expire.

Sources:

  • "Apple Inc, Microsoft Corp lead $4.5B auction for Nortel patents" (Syndigate.info, 2011)
  • "Nortel Obtains Court Order to Extend Stay of Proceedings" (Delaware Business Court Insider)
  • "Nortel's Bankruptcy Filing" (U.S. Bankruptcy Court, District of Delaware)