A consortium that includes Sony, Apple, Microsoft, RIM, EMC and Ericsson has teamed up to prevent Google getting access to wireless patents belonging to Nortel Networks. The group is believed to have forked out $4.5 Billion for the patents that are used in tablets and Smartphones.
Nortel’s portfolio includes around 6,000 patents and patent applications in telecommunications, Internet search and social networking. It also covers mobile, long-term evolution and data networking, as well as optical, Internet, service provider, semiconductors and other patent portfolios.
The winning price was five times Google’s opening bid. Google said it was disappointed that the patents would go to some of its major competitors. “This outcome is disappointing for anyone who believes that open innovation benefits users and promotes creativity and competition,” said Kent Walker, Google’s general counsel. “We will keep working to reduce the current flood of patent litigation that hurts both innovators and consumers.”
The interesting point is where the acquisition leaves the likes of HTC and Motorola and other Android phone makers who currently pay Nortel for access to their patents.
Apple, Microsoft and RIM, which makes BlackBerry phones, are three main smartphone makers that don’t build devices that run Android, which has seen its share of the global market surge to the No. 1 position recent months.
The Wall Street Journal said that the deal is the largest of its kind, both in terms of number of patents sold and its price tag, said Alex Poltorak, chief executive of the New York based intellectual property firm General Patent Corp. “Nobody expected the price to go this high,” he said, describing the assets as a “goldmine of patents.”
Carolina Milanesi, head of research at Gartner, said this is a case of making sure that one company alone wouldn’t get these patents and be at a strong advantage. “It also seems to be that it is about competitors getting together to make sure that one company was not Google,” she added.
Nortel filed for bankruptcy in 2009, and has been selling off assets in bankruptcy court since.