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Nortel announces Apple, Microsoft, RIM group bid wins patent auction for $4.5B

post #1 of 50
Thread Starter 
Canadian telecommunications equipment maker Nortel announced late Thursday that a consortium of companies, including Apple, EMC, Ericsson, Microsoft, Research in Motion and Sony, placed the winning bid in a high-profile auction for a collection of more than 6,000 patents.

"Following a very robust auction, we are pleased at the outcome of the auction of this extensive patent portfolio" George Riedel, Nortel's Chief Strategy Officer and President of Business Units, said in a statement. "The size and dollar value for this transaction is unprecedented, as was the significant interest in the portfolio among major companies around the world."

With a final bid of $4.5 billion, the consortium beat out Google, who had established the minimum bid for the auction with its $900 million starting offer. The search giant had expressed particular interest in the group of patents because, as a younger company than some of its rivals, it has a smaller patent collection.

Reuters reports that RIM's share of the purchase is roughly $770 million, while EMC paid $340 million.

The sale, however, is subject to applicable Canadian and U.S. Court approvals, A joint hearing is expected to be held on July 11, 2011, with Nortel expecting to close the sale in the third quarter of this year. Proceeds from the sale will go to Nortel's creditors and NNL preferred shareholders.

The patent trove drew a number of interested bidders because of it hold key patents related to the long-term evolution 4G standard. RIM co-CEO Mike Lazaridis has called Nortel's LTE patents a "national treasure." Other technologies in the collection span a wide-range of fields, such as wireless handsets, wireless network infrastructure, optical and data networking, Internet, Internet advertising.

Prior to the auction, Apple and Google underwent federal scrutiny over the their potential bids. Google received approval first to bid, while regulators were reportedly concerned over Apple's history of patent litigation. The FTC confirmed last week that Apple had been granted clearance to participate in the auction.

Nortel filed for bankruptcy in January 2009. On Thursday, the company obtained a court order extending a stay of proceedings until Dec. 14.
post #2 of 50
And just like that, all the positive energy at Google around the initial reception to G+ just went right out the window.

I wonder if the consortium will use these patents aggressively? I can't imagine why else they would bid $4.5B.

Interesting times...
post #3 of 50
Great news!!
post #4 of 50
In this day and age, googlesuck aside, i'd rather see a group win patents vs one company. awesome outcome.


another aside- anyone notice itunes and mac app store are not working right now. I kind of hope it's because lion is being released !!
post #5 of 50
I agree, this was the best possible outcome. No single company can bully others with these patents and they've not ended up in the hands of patent trolls.
post #6 of 50
Quote:
Originally Posted by Firefly7475 View Post

I wonder if the consortium will use these patents aggressively? I can't imagine why else they would bid $4.5B.

Defense.
post #7 of 50
Ahh Google ye are not really one of the big boys after all.
you only have freedom in choice when you know you have no choice
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you only have freedom in choice when you know you have no choice
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post #8 of 50
Samsung, HTC, Motorola,Intel and Android wantabe's around the world just saw their economics change drastically.... the cost of royalities just went up for many.... how much longer can Android be free when intellectual property has to be paid for somewhere along the way....
post #9 of 50
Steve Jobs outsmarted Google!
post #10 of 50
Quote:
Originally Posted by Firefly7475 View Post

And just like that, all the positive energy at Google around the initial reception to G+ just went right out the window.

I wonder if the consortium will use these patents aggressively? I can't imagine why else they would bid $4.5B.

Interesting times...

Collective IP acquisitions I would think are, except in extenuating circumstances, for defensive purposes.

My $0.02...
post #11 of 50
Quote:
Originally Posted by airmanchairman View Post

Collective IP acquisitions I would think are, except in extenuating circumstances, for defensive purposes.

My $0.02...

Defence against whom? Clearly the IP owners here will use the patents against non-IP owners, as they relate to LTE etc. The other side ( basically google and Android manufactures) are patentless.

As I see it, for Apple, a lot of the patent threats against it are solved or paid up. Whats remaining are nuisance patents. On the other hand it has the multi-touch patent and these.

Basically the Android side are wide open to litigation. Google and ( more likely) the manufacturers. From Apple, Oracle, MS ( as we have seen) and so on.
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post #12 of 50
Quote:
Originally Posted by airmanchairman View Post

Collective IP acquisitions I would think are, except in extenuating circumstances, for defensive purposes.

My $0.02...

$4.5 billion just for defense? Microsoft already had perpetual access to these patents, they didn't need to be included at all.

The only reason for them to be there is to prevent Google from getting the patents, and the only reason to prevent Google from getting the patents is to prevent them from being able to defend themselves (or their partners).

Microsoft already have licensing deals with Android manufactuers (HTC, Velocity Micro, Onkyo, General Dynamics).

I'm sure they are going to push more licensing fees onto the Android manufacturers (i.e. Samsung!) to pay for the "free" Android OS.
post #13 of 50
Quote:
Originally Posted by Firefly7475 View Post

$4.5 billion just for defense? Microsoft already had perpetual access to these patents, they didn't need to be included at all.

The only reason for them to be there is to prevent Google from getting the patents, and the only reason to prevent Google from getting the patents is to prevent them from being able to defend themselves (or their partners).

Microsoft already have licensing deals with Android manufactuers (HTC, Velocity Micro, Onkyo, General Dynamics).

I'm sure they are going to push more licensing fees onto the Android manufacturers (i.e. Samsung!) to pay for the "free" Android OS.

except now, presumably the payments go to the consortium.
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post #14 of 50
Quote:
Originally Posted by Firefly7475 View Post

And just like that, all the positive energy at Google around the initial reception to G+ just went right out the window.

I wonder if the consortium will use these patents aggressively? I can't imagine why else they would bid $4.5B.

Interesting times...

That high winning amount is due to individual companies in the consortium were wiling to contribute more than any single company would on their own. I imagine if they license them out, the money they'll receive will be proportionate to the holding percentage. The licensing fee and arrangement between consortium members however would be different, could be lower but payable still.
post #15 of 50
Quote:
Originally Posted by asdasd View Post

Defence against whom? Clearly the IP owners here will use the patents against non-IP owners, as they relate to LTE etc. The other side ( basically google and Android manufactures) are patentless.

Are you honestly suggesting that Motorola, Samsung et al have no patents? Motorola is one of the biggest holders of GSMA patents.
post #16 of 50
I wonder what is the maximum amount Google bid.

With Mango and some other updates waiting in the wing, I guess this could be the right time for manufacturers to be a bit more serious about WP7 platform?
post #17 of 50
Quote:
Originally Posted by _Hawkeye_ View Post

Defense.

Sorry, but NORTEL was a huge IP holder of LTE and much, much more.
post #18 of 50
Quote:
Originally Posted by RichL View Post

Are you honestly suggesting that Motorola, Samsung et al have no patents? Motorola is one of the biggest holders of GSMA patents.

Apple has cross-licensed such needs through Nokia.
post #19 of 50
Quote:
Originally Posted by Firefly7475 View Post

$4.5 billion just for defense? Microsoft already had perpetual access to these patents, they didn't need to be included at all.

The only reason for them to be there is to prevent Google from getting the patents, and the only reason to prevent Google from getting the patents is to prevent them from being able to defend themselves (or their partners).

Microsoft already have licensing deals with Android manufactuers (HTC, Velocity Micro, Onkyo, General Dynamics).

I'm sure they are going to push more licensing fees onto the Android manufacturers (i.e. Samsung!) to pay for the "free" Android OS.


Linkage to the PERPETUAL access please.
post #20 of 50
Quote:
Originally Posted by cy_starkman View Post

Ahh Google ye are not really one of the big boys after all.

Google sells ads. If people stop clicking on ads Google goes out of business. No, they are not one of the big boys.
post #21 of 50
Amazing news. There was a time when Google and Apple would have been together, such a shame Google turned on their old friend. Come on Apple, search and maps please.
From Apple ][ - to new Mac Pro I've used them all.
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From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
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post #22 of 50
Quote:
Originally Posted by msantti View Post

Linkage to the PERPETUAL access please.

http://www.microsoft.com/presspass/p...GNortelPR.mspx

But it's not clear whether Nortel's bankruptcy could have caused the agreement to become null, it's certainly plausible.
post #23 of 50
Quote:
Originally Posted by mdriftmeyer View Post

Apple has cross-licensed such needs through Nokia.

Are you trying to suggest that Nokia has licensed Motorola's patents to Apple? *face palm*
post #24 of 50
Quote:
Originally Posted by LongwoodBob View Post

Samsung, HTC, Motorola,Intel and Android wantabe's around the world just saw their economics change drastically.... the cost of royalities just went up for many.... how much longer can Android be free when intellectual property has to be paid for somewhere along the way....

Are you sure Samsung isnt on the list indirectly?

http://www.bestgrowthstock.com/stock...ense-interest/

"Like I said before, share price will dip into the $400."  - 11/21/12 by Galbi

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"Like I said before, share price will dip into the $400."  - 11/21/12 by Galbi

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post #25 of 50
Quote:
Originally Posted by msantti View Post

Linkage to the PERPETUAL access please.

Really?

Alright, here you go.
post #26 of 50
Google needs to realize that they are an online services provider, not everything to everyone. Stick to what you're good at (maps, search, email, YouTube) and let everyone else take care of making the devices to get people to those services. If they had never made Android and made deals with RIM, Apple, Palm, Nokia, etc. to use Google services, they would be in an even better position than they are, IMHO. Just look at all the Google fingerprints on iOS still to this day (maps, YouTube app, default search)

edit: edited for typo
post #27 of 50
Quote:
Originally Posted by Firefly7475 View Post

And just like that, all the positive energy at Google around the initial reception to G+ just went right out the window.

What positive energy? From everything I've read, Google+ has bombed. People have classified it as too difficult to use and as no threat to Facebook.

It's entirely possible I'm not reading the right reports though.
post #28 of 50
Quote:
Originally Posted by Splash-reverse View Post

That high winning amount is due to individual companies in the consortium were wiling to contribute more than any single company would on their own. I imagine if they license them out, the money they'll receive will be proportionate to the holding percentage. The licensing fee and arrangement between consortium members however would be different, could be lower but payable still.

There might of been a single company willing to pay almost as much. The winning bid got to that amount somehow. If Apple is more then a 50% contributor to the consortium, Apple might essentially control the patents.
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post #29 of 50
Quote:
Originally Posted by Firefly7475 View Post

And just like that, all the positive energy at Google around the initial reception to G+ just went right out the window.

I wonder if the consortium will use these patents aggressively? I can't imagine why else they would bid $4.5B.

I would say not. The fact that a group of companies pulled together to buy them, means they wanted to keep them out of the hands of someone who would use them offensively and aggressively. This is also Apple's second time in joining with a group of companies to secure wireless related pantents.
Disclaimer: The things I say are merely my own personal opinion and may or may not be based on facts. At certain points in any discussion, sarcasm may ensue.
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Disclaimer: The things I say are merely my own personal opinion and may or may not be based on facts. At certain points in any discussion, sarcasm may ensue.
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post #30 of 50
Quote:
Originally Posted by guch20 View Post

What positive energy? From everything I've read, Google+ has bombed. People have classified it as too difficult to use and as no threat to Facebook.

It's entirely possible I'm not reading the right reports though.

No, its had quite a positive reception.

I teased it a bit when I first saw it as well. It looks like direct Facebook clone with UI elements stolen from Microsoft's metro playbook!

After using it for a day though I'm starting to "get it"... a couple of things stand out.

The first is that Google+ isn't really Facebook per se, it's more like what Facebook+XBL are to Windows Phone (or at least Mango).

Think unified social communications platform (i.e. messaging, chat, voice, video) group experiences and media sharing.

The second is that it's soooooo pervasive. If you're using a Google, you're on G+. You don't need to go to the G+ site... it's just always there.

My predictions:
  • The Google toolbar will be added to YouTube by the end of the year.
  • G+ will be baked in Ice Cream Sandwich. End to end and everything in between.
  • G+ will be baked into ChromeOS and the Chrome browser. Not sure when this will happen. Probably within a year.

Something else that needs to happen is an Apple/Facebook truce.

After Microsoft purchased Skype I made the prediction that we would see Skype communications baked into Facebook.

After using G+ I'm doubling up on that prediction... however, I think that if Apple made the right kind of offer we could easily see an iMessage/iChat/Facetime integration with Facebook and Facebook baked into iOS.

Twitter integration into iOS5 is cute, but to be honest Apple need Facebook.
post #31 of 50
Quote:
Originally Posted by Firefly7475 View Post

No, its had quite a positive reception.

Something else that needs to happen is an Apple/Facebook truce.

After Microsoft purchased Skype I made the prediction that we would see Skype communications baked into Facebook.

After using G+ I'm doubling up on that prediction... however, I think that if Apple made the right kind of offer we could easily see an iMessage/iChat/Facetime integration with Facebook and Facebook baked into iOS.

Twitter integration into iOS5 is cute, but to be honest Apple need Facebook.

The reception has been positive. Zuckerberg should be concerned, just as RIM should have been concerned when Apple first released the iPhone. Apple doesn't need Facebook. Facebook needs Apple.
Hmmmmmm...
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Hmmmmmm...
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post #32 of 50
Not only is this a defensive move, it is also a sure way of getting it past gov. regulators (hmmm REGULATORS RIDE!!!! ... sorry that slipped out), if one company bought that portfolio it might have been blocked, with several companies there is not a huge worry about shutting out competition.
post #33 of 50
If you're forced to overpay for something by circumstance, it's nice to have partners. Nortel's creditors are the winners here.
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post #34 of 50
Quote:
Originally Posted by hittrj01 View Post

Google needs to realize that they are an online services provider, not everything to everyone. Stick to what you're good at (maps, search, email, YouTube) and let everyone else take care of making the devices to get people to those services. If they had never made Android and made deals with RIM, Apple, Palm, Nokia, etc. to use Google services, they would be in an even better position than they are, IMHO. Just look at all the Google fingerprints on iOS still to this day (maps, YouTube app, default search)

edit: edited for typo

YouTube was sooo much better before Google. Now it's just ads.
post #35 of 50
Quote:
Originally Posted by city View Post

If you're forced to overpay for something by circumstance, it's nice to have partners. Nortel's creditors are the winners here.

$750 for AdMob is overpayment.

$8 billion for Skype is overpayment.

$4.5 billion for Nortel's patents is not overpayment.

... but it is nice to have partners to share the bill... and, yes, lawyers and creditors are also winners in this deal.
Hmmmmmm...
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Hmmmmmm...
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post #36 of 50
Quote:
Originally Posted by RichL View Post

Are you honestly suggesting that Motorola, Samsung et al have no patents? Motorola is one of the biggest holders of GSMA patents.

This will really help Apple against Motorola's suit against Apple. There is a good chance now, that Apple will not be paying Motorola a dime.
post #37 of 50
Quote:
Originally Posted by island hermit View Post

The reception has been positive. Zuckerberg should be concerned, just as RIM should have been concerned when Apple first released the iPhone. Apple doesn't need Facebook. Facebook needs Apple.

That's going too far the other way. Just as G+ can't be dismissed as irrelevant, it also can't be seen as the "Facebook killer".

I can see G+ being the social glue that pulls Google's services together, but I can't see it replacing Facebook.
post #38 of 50
Well this is good news. I'm glad that Apple is part of the consortium that won the bid. As much as I don't like Microsoft. I must give them some credit for making a phone os that is very different from iOS. It seems like Microsoft is at least respecting Apple's designs and doing what they can to avoid being an iOS "copyist" like Google and their OEM phone manufacturers. I don't believe that Apple has any issues with Sony/Ericsson phone, because once again, their phones do not copy the iPhone, much. Rimm, too is vastly different.
It looks like Google and their OEMs are going to be suffering for this one.
post #39 of 50
Quote:
Originally Posted by Firefly7475 View Post

That's going too far the other way. Just as G+ can't be dismissed as irrelevant, it also can't be seen as the "Facebook killer".

I can see G+ being the social glue that pulls Google's services together, but I can't see it replacing Facebook.

Balsillie and Lazaridis said the same sort of thing about the iPhone...
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Hmmmmmm...
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post #40 of 50
Quote:
Originally Posted by djmikeo View Post

Well this is good news. I'm glad that Apple is part of the consortium that won the bid. As much as I don't like Microsoft. I must give them some credit for making a phone os that is very different from iOS. It seems like 1) Microsoft is at least respecting Apple's designs and 2) doing what they can to avoid being an iOS "copyist" like Google and their OEM phone manufacturers. I don't believe that Apple has any issues with Sony/Ericsson phone, because once again, their phones do not copy the iPhone, much. Rimm, too is vastly different.
It looks like Google and their OEMs are going to be suffering for this one.

Wrong on point 1 (in bold) and right on point 2 (in bold)... imho. MS was smart enough to create a different user experience than iOS with WP7 (Ballmer must have been away that day), it had nothing to do with respect (unless you meant respect in the sense that they respect Apple's success with the iPhone and decided that a copy wouldn't cut it).

MS is doing what tablet manufacturers should be doing... creating a different experience in the same form factor. webOS has (had) the best chance of doing this (again, imho) and hopefully it will be 3rd time a charm for HP sometime in the future.

[ on edit: Somebody must be liking Google's moves... the competitors (Apple, HP, MS are up no more than 1.6% today but Google is up 2.15%... actually Yahoo is also up 2.5% today... something up in the search area?! ]
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