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Inside look at $4.5B Nortel patent auction reveals battle of wills between Apple, Google - Page 5

post #161 of 300
Quote:
Originally Posted by sheff View Post

Google could have paid the 4.5 billion. They could have paid 10 billion, so why drop out? They needed the patents more than apple to cover android from what I understand. Or is google betting they won't be sued by anyone? Im a bit confused on why the accepted defeat.

There becomes a point at which the cost of not purchasing the patents is actually cheaper than buying them, ie. the cost of licenses or re-engineering is less and probably better for overall cashflow.

I must say I love Google's bid values. Any number is as good as another so why not bid pi.
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post #162 of 300
Quote:
Originally Posted by Telomar View Post

There becomes a point at which the cost of not purchasing the patents is actually cheaper than buying them, ie. the cost of licenses or re-engineering is less and probably better for overall cashflow.

I must say I love Google's bid values. Any number is as good as another so why not bid pi.

If I we're still a shareholder I'd be pissed at Google for their flippant regard with their company's money and future. The entire point of an auction is to pay as little as possible by gauging your competitor's interest and funds or to get your competitor to pay more than the actual worth. None of what Google did led to either of those two outcomes. It was a complete waste of time.
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post #163 of 300
Quote:
Originally Posted by solipsism View Post

If I we're still a shareholder I'd be pissed at Google for their flippant regard with their company's money and future. The entire point of an auction is to pay as little as possible by gauging your competitor's interest and funds or to get your competitor to pay more than the actual worth. None of what Google did led to either of those two outcomes. It was a complete waste of time.

I don't think that's quite fair, Google's approach is a classic psycho out. During the bidding their rivals had to ask what the strange bids meant, even once they realized they were constants they had to wonder what the deeper meaning was. Did this mean Google wasn't serious or was it a double bluff? If Google felt the patents were worth more - they could have bid more.
post #164 of 300
Quote:
Originally Posted by cloudgazer View Post

I don't think that's quite fair, Google's approach is a classic psycho out. During the bidding their rivals had to ask what the strange bids meant, even once they realized they were constants they had to wonder what the deeper meaning was. Did this mean Google wasn't serious or was it a double bluff? If Google felt the patents were worth more - they could have bid more.

Concerning meanings and psyching out your opponent with crazy ass bids... you're not serious... are you?! Do you really think the guys from Apple gave a shit... did you think that they were all wierded out thinking they were going to turn into pumpkins or something...

As concerns the reasons for Google not bidding more... none of us will ever know...
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post #165 of 300
Bottom line is that this will make it difficult for Google. Just rewards for Google's actions IMHO.
post #166 of 300
Quote:
Originally Posted by island hermit View Post

Concerning meanings and psyching out your opponent with crazy ass bids... you're not serious... are you?! Do you really think the guys from Apple gave a shit... did you think that they were all wierded out thinking they were going to turn into pumpkins or something...

As concerns the reasons for Google not bidding more... none of us will ever know...

I'm quite sure the guys at Apple scratched their heads a bit, bids send a message, you even implied that yourself - the aim is to read your opponents message and if possible to hide your own, or lie. Also this message went out not just to Apple but to everybody in the tech-geek world. If you go onto engadget the cheers from the fandroids on this are deafening.

Google changed the terms of the discussion, instead of the chatter being all that they lost, half of it is about the uber-geek attitude they displayed. That's very valuable PR in an important opinion-forming demographic.
post #167 of 300
Quote:
Originally Posted by cloudgazer View Post

Google changed the terms of the discussion, instead of the chatter being all that they lost, half of it is about the uber-geek attitude they displayed. That's very valuable PR in an important opinion-forming demographic.

Yes, such as the demographic of government regulators and courts that Google will beseech to block the sale and who will likely view Google as a being purely asses.
post #168 of 300
Quote:
Originally Posted by Cpsro View Post

Yes, such as the demographic of government regulators and courts that Google will beseech to block the sale and who will likely view Google as a being purely asses.

I doubt Google is going to do any such thing. Apple got pre-cleared to buy the patents and Google has notably not itself engaged in litigation with Apple, and vice versa. The Apple v Google story is great copy and it gets lots of page hits, but it's not cut and dried - not the way that Apple v MS was back in the 90s.

If anybody is going to complain about this it won't be Google, it will be Samsung.
post #169 of 300
Someone should make a movie about the auction: "The Nortel Patents Auction"

The movie should cover all the preparations for the auction from both the bidders an the seller. What were the plans, the strategies, the preparations, the emotions, the participants for each company.

Which company prepared more thoroughly?

Did the companies review all 6000+ patents and patent applications to determine which ones they wanted and which ones the could give up?

What was Steve's involvement in Apple's preparation?

How did RIMM plan to get so much from this deal for nothing using Canadian tax laws.

Why did Intel side with Google instead of Apple? (I think Intel wanted the 4G LTE patents and Apple said no.)

Would Apple have paid 4.5 billions if it were bidding alone?

What were the emotional reactions after the bidding?

Time will tell.
post #170 of 300
Quote:
Originally Posted by cloudgazer View Post

I doubt Google is going to do any such thing. Apple got pre-cleared to buy the patents and Google has notably not itself engaged in litigation with Apple, and vice versa. The Apple v Google story is great copy and it gets lots of page hits, but it's not cut and dried - not the way that Apple v MS was back in the 90s.

If anybody is going to complain about this it won't be Google, it will be Samsung.

Uh, this casts a shadow on everything Google does going forward (or in reverse, as the case may be).
post #171 of 300
Quote:
Originally Posted by AppleSauce007 View Post

How did RIMM plan to get so much from this deal for nothing using Canadian tax laws.

Does that have any confirmation yet, or is it still just Cringely?
post #172 of 300
Partial Quote

Quote:
Originally Posted by cloudgazer View Post


The handest OEMs thought Google was their boyfriend, but in fact it's their dealer, and practically their pimp. At this point there choice is to stay with Google or try to switch to MS, they don't have any other options - and MS is the bluebeard of tech - there's a room in Redmond with the bodies of their former industry partners.

Best summary of the situation I've ever read!
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post #173 of 300
Quote:
Originally Posted by cloudgazer View Post

I'm quite sure the guys at Apple scratched their heads a bit, bids send a message, you even implied that yourself - the aim is to read your opponents message and if possible to hide your own, or lie. Also this message went out not just to Apple but to everybody in the tech-geek world. If you go onto engadget the cheers from the fandroids on this are deafening.

Google changed the terms of the discussion, instead of the chatter being all that they lost, half of it is about the uber-geek attitude they displayed. That's very valuable PR in an important opinion-forming demographic.

Oh for fucks sake.

Rockstar just looked at the bid and added a few million... they didn't give a rat's ass what Google bid... they were ready to buy and buy they did... with over a $100 billion in the war chest altogether.

Engadget??!! C'mon... you gotta be kidding me... beyond the 25,000 people addicted to tech forums nobody gave a shit what Google did or didn't do during the bidding. 98% of the population didn't even know there was an auction and the majority of the other 2% heard it on the news and then changed the channels.
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post #174 of 300
Quote:
Originally Posted by island hermit View Post

Engadget??!! C'mon... you gotta be kidding me... beyond the 25,000 people addicted to tech forums nobody gave a shit what Google did or didn't do during the bidding. 98% of the population didn't even know there was an auction and the majority of the other 2% heard it on the news and then changed the channels.

There was a really interesting discussion a while back on an Apple related podcast, I think build&analyze, where they talked about Facebook and Amazon going out of their way to try to win over geeks. Geeks opinion mattered, partly because geeks are opinion formers who influence non-geeks but also because geeks are your target market for recruitment.

Google absolutely cares about it's perception amongst geeks. Why else do you think they release high production value videos about their seawater cooling system in a datacentre?

Quote:
Rockstar just looked at the bid and added a few million... they didn't give a rat's ass what Google bid... they were ready to buy and buy they did... with over a $100 billion in the war chest altogether.

Ok so if bidding is really so simple then you also disagreed with Solipsism

Quote:
Originally Posted by solipsism View Post

The entire point of an auction is to pay as little as possible by gauging your competitor's interest and funds or to get your competitor to pay more than the actual worth.

Either participants do attempt to gauge their competitor's interest from their bidding strategy or they don't, which is it? Either Google's approach was significant in some game theoretic way, or it was harmless. But certainly you can't believe it was bad for Google.
post #175 of 300
Quote:
Originally Posted by cloudgazer View Post


Ok so if bidding is really so simple then you also disagreed with Solipsism

Yeah... so?!...

Quote:
Originally Posted by cloudgazer View Post

Either participants do attempt to gauge their competitor's interest from their bidding strategy or they don't, which is it? Either Google's approach was significant in some game theoretic way, or it was harmless. But certainly you can't believe it was bad for Google.

They didn't give a shit about Google's interest... Apple for one, and I'm sure Microsoft and RIM as well, were not walking away from this auction empty handed. They had the cash and they knew that Google would not empty the bank to get these patents... so they just kept bidding. 4 of the companies on Rockstar's team are phone manufacturers... nobody on Google's team is a phone manufacturer. ... and, again, Rockstar had the cash. You figure out who was going to walk away from this with a win.

Do you really think that Apple, Microsoft, RIM and Sony didn't analyze Google's cash position prior to this... they already had a preset number where they knew it would hurt Google to play... so all they had to do was to keep bidding to that number knowing it wasn't going to hurt Rockstar. One of the Rockstar members had double the cash that Google has... another equaled Google. Google could have put any damn number down and it wouldn't have fazed Rockstar... until that X number that would hurt Google was reached... but Google also knew that number and they weren't going to get anywhere close to it.

$2 billion for those patents was nothing to Apple and Google knew the writing was on the wall when Apple joined the Rockstar team. Google might have had fancy numbers but I know they shit their pants when Apple joined Microsoft in the bid.

... and hell, I give the Apple team some really big points for the name Rockstar.
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post #176 of 300
Quote:
Originally Posted by island hermit View Post

Yeah... so?!...
They didn't give a shit about Google's interest... Apple for one, and I'm sure Microsoft and RIM as well, were not walking away from this auction empty handed.

Ok if you really think that then you're crazy. Apple had an upper limit on this auction and it wasn't 70Billion. It probably wasn't even 30billion (google's cash position). There's a huge amount of game-theoretic study on auctions and of all tech firms I'd expect Google to be aware of them.
post #177 of 300
Quote:
Originally Posted by melgross View Post

The government isn't concerned about this at all. it's a matter of taxes. When money is earned offshore, the tax is paid there. But governments want to do double dipping, so some large companies that earn a large portion of their income offshore want some tax relief to bring that money here.

It's a complex question, but I agree with what they want to do. For the US, better the money is here then there.

The currencies would be whatever they would be expected to be wherever they are. They aren't in US dollars. I certainly don't know what the earnings are specifically. We just know what has been estimated.

I don't agree with their idea.

It's a crock of crap. They were given tax free through loop holes to off-shore it and instead of paying the 35% to bring it back in they want to cut it down to 5%.

They can grow up and realize the lowest the US should allow it back in for is 20%.

And yes the Government is concerned which is the reason they rejected the 5% offer.
post #178 of 300
Quote:
Originally Posted by island hermit View Post

Oh for fucks sake.

Rockstar just looked at the bid and added a few million... they didn't give a rat's ass what Google bid... they were ready to buy and buy they did... with over a $100 billion in the war chest altogether.

Engadget??!! C'mon... you gotta be kidding me... beyond the 25,000 people addicted to tech forums nobody gave a shit what Google did or didn't do during the bidding. 98% of the population didn't even know there was an auction and the majority of the other 2% heard it on the news and then changed the channels.

Agreed.

Not to mention it seems a lot of people don't grasp the cost of keeping the ship afloat, every quarter and how much a company's assets are leveraged. Google has a total debts to assets ratios of 5.36:1. Apple 0. Google has a total debt to equity ratio of 6.58:1. Apple 0.

It's rather ironic that Apple generates higher net profit margins than Google and Google's latest income revenue was $8.575 Billion to Apple's $24.667 Billion.

There was no way that Google could leverage enough pooling to stop Apple from getting these patents.
post #179 of 300
Quote:
Originally Posted by mdriftmeyer View Post

I don't agree with their idea.

It's a crock of crap. They were given tax free through loop holes to off-shore it and instead of paying the 35% to bring it back in they want to cut it down to 5%.

They can grow up and realize the lowest the US should allow it back in for is 20%.

And yes the Government is concerned which is the reason they rejected the 5% offer.

So if they already paid 25% or more in Europe on their profits here, they should pay another 20% to bring the money back to the US? Well that makes lots of sense, glad you cleared that up.

If the problem is that profits are being booked in the wrong jurisdiction then the IRS are entitled to go after that. Glaxo famously paid 3BN in settlements on exactly that issue. If the big tech firms are simply booking their profits where they earn them then this is entirely justified.
post #180 of 300
Quote:
Originally Posted by mdriftmeyer View Post

Agreed.

Not to mention it seems a lot of people don't grasp the cost of keeping the ship afloat, every quarter and how much a company's assets are leveraged. Google has a total debts to assets ratios of 5.36:1. Apple 0. Google has a total debt to equity ratio of 6.58:1. Apple 0.

Oh really?

http://ycharts.com/companies/GOOG/debt_equity_ratio

Kinda looks like zero to me. Which common sense should have told you since google turns over large amounts of cash every quarter from advertising and their main expense is electricity to run data-centers. I've no idea where you pulled those numbers from, but they're grotesquely wrong. Apple, Google and Microsoft all have zero debt. Even Intel has debt:equity of 0.04 and they have to build multi-billion dollar fabs every year
post #181 of 300
Quote:
Originally Posted by cloudgazer View Post

Ok if you really think that then you're crazy. Apple had an upper limit on this auction and it wasn't 70Billion. It probably wasn't even 30billion (google's cash position). There's a huge amount of game-theoretic study on auctions and of all tech firms I'd expect Google to be aware of them.

Just as I thought.... you really don't read people's responses before you reply.

Try re-reading my comment and then respond... it'll make it easier for you not to look like a fool.
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post #182 of 300
Quote:
Originally Posted by island hermit View Post

Just as I thought.... you really don't read people's responses before you reply.

Try re-reading my comment and then respond... it'll make it easier for you.

I did read it - you missed the key point. Solipsism is absolutely right when he said that part of the point for Google is to make competitors overpay. Yes Google didn't need the patents for itself but it could easily easily afford more than 4.5billion. So if there was 'no doubt that Apple was gonna win' Google should have kept bidding, because no doubt Apple would have outbid them.

If you were correct Google had a riskless way to damage Apple's business, on the other hand if you were wrong as I contend then it was all much more complicated than that. Google was either bidding to drive the price up for Apple, or bidding to win but hoping that Apple would think it was trying to drive up the price. If the former then Google wants to push Apple right up to its limit, if the latter then Google wants Apple to think that it's doing the former and that the price is already over the value to Google.

So I stand by my point, if you really think that Apple was 100% certain to walk away with the patents, then you are crazy and have no understanding of auctions. Because as Apple themselves would be aware, at a certain price that would constitute losing.
post #183 of 300
Quote:
Originally Posted by cloudgazer View Post

So I stand by my point, if you really think that Apple was 100% certain to walk away with the patents, then you are crazy and have no understanding of auctions. Because as Apple themselves would be aware, at a certain price that would constitute losing.

Let me make this simple for you since you refuse to read my earlier comment:

* Apple reads Google's financials. Microsoft, Rim, Ericsson and Sony do the same.

* They understand the maximum limit that Google can hit financially (and it's not their cash position). We'll call this figure X. Apple can hit figure X by itself but Rockstar is a consortium so they can bid above that number.

* Apple, RIM and Ericsson are phone manufacturers... these patents are important to their businesses.

* Apple and Microsoft each have a tremendous cash position.

* The original Rockstar team, Google, Intel and Apple keep bidding up the price. Nobody gives a shit about Google's crazy numbers. Apple and Rockstar just keep the bidding alive.

* Intel is almost tapped out and Google starts nearing figure X as the bidding continues... so they join forces. Apple doesn't care... it needs the patents.

* Ericsson sees that Rockstar is starting to tap out because Microsoft's interest as a non phone manufacturer is starting to wane. Ericsson talks to apple and brings Apple into Rockstar. Apple laughs... because now they can have the patents for much less than they were willing to pay.

* Googles shits pants and drops out because figure X is only a few bucks away and they don't want to get caught bidding over their safe figure X knowing full well that Apple plus Rockstar will bury them. Crazy ass numerical bids don't count for shit when all you have to do is add a few more million to the stupid numbers.

* Microsoft and Apple didn't even break a sweat... they laugh as they write their cheques. RIM breathes a sigh of relief and thanks Apple for joining their team.

You're welcome.
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post #184 of 300
island hermit.... Cool story bro.
But you need to stay with the facts.

There are numerous errors in your account. Your reality distortion field is strong ... but it's not the good kind like Steve Jobs is.

Read all the articles that were leaked out and you will see why.

First of all Rockstar was Apple and Apple only. The MSFT, RIMM, SNE...etc consortium tapped out first. Apple and Google were the only ones left. The MSFT/RIMM consortium then returned by forming alliance with Apple's Rockstar after Intel joined Google's side.

I'm a surgeon but I look at financial reports all day for my investments. The financial reports will not tell you with any accuracy how much Google was willing to spend. Only Google knows that.
post #185 of 300
Quote:
Originally Posted by bunnyturd View Post

Your reality distortion field is strong ... but it's not the good kind like Steve Jobs is.

that line made my day!
post #186 of 300
Quote:
Originally Posted by bunnyturd View Post

island hermit.... Cool story bro.
But you need to stay with the facts.

There are numerous errors in your account. Your reality distortion field is strong ... but it's not the good kind like Steve Jobs is.

Read all the articles that were leaked out and you will see why.

First of all Rockstar was Apple and Apple only. The MSFT, RIMM, SNE...etc consortium tapped out first. Apple and Google were the only ones left. The MSFT/RIMM consortium then returned by forming alliance with Apple's Rockstar after Intel joined Google's side.

I'm a surgeon but I look at financial reports all day for my investments. The financial reports will not tell you with any accuracy how much Google was willing to spend. Only Google knows that.

Hmmm... I don't see much of difference between your story and mine, other than I thought the Rockstar name belonged to the MS group. If you read my account you could see that Apple was in it for the long haul and that they only joined when Ericsson came to Apple because their consortium was tapped out. Intel was also tapped out... so who went to whom first is the only thing different from your story to mine. It actually doesn't make that much of a difference in the 2 accounts... yours and mine.

... and you can't tell me that Google wasn't getting close to figure X where it would hurt them more than help them when they joined with Intel (and we already know that everyone knew they had to get special permission to go beyond their $3 billion limit... and I'm positive that Apple's figure X was higher anyway).

... and it's obvious that Apple didn't need anyone's help to bid as they please... partners were a bonus to Apple... they didn't seem to have any limits.

{on edit: yup... checked your story and mine and the differences are so minimal as to be inconsequential... oh... and Apple never was Rockstar on its own... Rockstar Bidco was always the entire consortium}
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post #187 of 300
Quote:
Originally Posted by mdriftmeyer View Post

I don't agree with their idea.

It's a crock of crap. They were given tax free through loop holes to off-shore it and instead of paying the 35% to bring it back in they want to cut it down to 5%.

They can grow up and realize the lowest the US should allow it back in for is 20%.

And yes the Government is concerned which is the reason they rejected the 5% offer.

Stay with me here for a minute.

Most of the rest of the world's global corporations are taxed on a "territorial" basis -- i.e., if you pay your taxes where you're doing business, you're considered all set vis-a-vis your home country's tax obligations.

The US prefers to do it differently: it has a "worldwide" system of taxation -- i.e., the IRS requires you to pay your taxes at the US rate regardless of where your income is generated. But that kicks in only when you bring the money back home. Add to it the fact that, in the industrialized word, the US has the highest corporate tax rate 34%).

This affects the competitive position of US firms vis-a-vis their global competitors. So guess where US firms keep their income earned abroad?

Short of fundamentally changing our tax system, this sort of 'tax holday' nonsense will, unfortunately, crop up very few years. And it will be granted.
post #188 of 300
Quote:
Originally Posted by mdriftmeyer View Post

Not to mention it seems a lot of people don't grasp the cost of keeping the ship afloat, every quarter and how much a company's assets are leveraged. Google has a total debts to assets ratios of 5.36:1. Apple 0. Google has a total debt to equity ratio of 6.58:1. Apple 0.

For companies like Google, Book Assets (which is the denominator in your leverage ratio) is an utterly meaningless number. It does not make much sense at all to use that as a metric to compare Google to Apple.
post #189 of 300
Quote:
Originally Posted by island hermit View Post

* Googles shits pants and drops out because figure X is only a few bucks away and they don't want to get caught bidding over their safe figure X knowing full well that Apple plus Rockstar will bury them. Crazy ass numerical bids don't count for shit when all you have to do is add a few more million to the stupid numbers.

You're making even less sense here than normal. If Google is close to X their final figure then they WANT Rockstar to bury them, because that means Rockstar just overbid and payed far more for the asset than it's worth. Why would Google be scared of Apple massively out bidding them? Do you think they get scared by large sums of money? The only fear Google has near X is that Rockstar pulls out. Until you can understand that simple concept I can't help you, in fact I doubt anybody can.

Look imagine the absolute simplest possible auction of an Asset X. X is worth A to Apple and G to Google, and in our approximation lets pretend that both parties know both values - let's also assume for convenience that A > G.

Bidding proceeds quickly to G and then gets complex. In principle Google can push Apple all the way to A and it's still in Apple's interest to outbid, but at some point Apple may decide that it's better to let Google overpay, even though they would be leaving value on the table. So even in this scenario where there is perfect knowledge of value there is a sophisticated question as to how far Google bids. It depends on whether Google's loss is Apple's gain and in what proportion, and vice-versa. If you know that final relationship then in our unrealistic approximation then you know the correct value for Google to stop bidding.

Once you introduce real world uncertainties it rapidly gets very complicated.

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You're welcome.
post #190 of 300
You all have it all wrong. GOOG just ran out of cool mathematical constants and decided to stop playing.
post #191 of 300
Quote:
Originally Posted by cloudgazer View Post

You're making even less sense here than normal. If Google is close to X their final figure then they WANT Rockstar to bury them, because that means Rockstar just overbid and payed far more for the asset than it's worth. Why would Google be scared of Apple massively out bidding them? Do you think they get scared by large sums of money? The only fear Google has near X is that Rockstar pulls out. Until you can understand that simple concept I can't help you, in fact I doubt anybody can.

Look imagine the absolute simplest possible auction of an Asset X. X is worth A to Apple and G to Google, and in our approximation lets pretend that both parties know both values - let's also assume for convenience that A > G.

Bidding proceeds quickly to G and then gets complex. In principle Google can push Apple all the way to A and it's still in Apple's interest to outbid, but at some point Apple may decide that it's better to let Google overpay, even though they would be leaving value on the table. So even in this scenario where there is perfect knowledge of value there is a sophisticated question as to how far Google bids. It depends on whether Google's loss is Apple's gain and in what proportion, and vice-versa. If you know that final relationship then in our unrealistic approximation then you know the correct value for Google to stop bidding.

Once you introduce real world uncertainties it rapidly gets very complicated.

... and you missed the part in all of your bullshit where Google had to get permission to go past their $3 billion limit. They were tapped long before $4 billion but they stretched it out... and why would they have teamed up with Intel.

You're welcome.
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post #192 of 300
Quote:
Originally Posted by island hermit View Post

... and you missed the part in all of your bullshit where Google had to get permission to go past their $3 billion limit. They were tapped long before $4 billion but they stretched it out... and why would they have teamed up with Intel.

You're welcome.

Silly! When the bidding was lower than $3B, they were able to bid, in increasing order, Brun's constant, Meissel–Mertens constant and e. Obviously, they were able to go past $3B with a $3.14159 ... bid. But, once past $4B? Well, they did bid the Feigenbaum constant. Unfortunately for them, this proved to be confusing. You see - the first Feigenbaum constant is 4.6692..., the 2nd Feigenbaum constant is 2.5029 ... The auctioneer thought of the second one only and declared Apple the winner.

You're welcome.
post #193 of 300
Quote:
Originally Posted by cloudgazer View Post

I don't think that's quite fair, Google's approach is a classic psycho out. During the bidding their rivals had to ask what the strange bids meant, even once they realized they were constants they had to wonder what the deeper meaning was. Did this mean Google wasn't serious or was it a double bluff? If Google felt the patents were worth more - they could have bid more.

I don't think it really mattered to anyone else. They may have wondered why they were bidding in such odd ways, but it wouldn't confuse anyone, or make them pause. A bid is a bid. It doesn't matter to anyone how serious the bidder is. You can't bluff. If they end up with the high bid, they've got to pay up, or serious penalties are administered. If they lose, well, they lose, as happened here.
post #194 of 300
Quote:
Originally Posted by cloudgazer View Post

I'm quite sure the guys at Apple scratched their heads a bit, bids send a message, you even implied that yourself - the aim is to read your opponents message and if possible to hide your own, or lie. Also this message went out not just to Apple but to everybody in the tech-geek world. If you go onto engadget the cheers from the fandroids on this are deafening.

Google changed the terms of the discussion, instead of the chatter being all that they lost, half of it is about the uber-geek attitude they displayed. That's very valuable PR in an important opinion-forming demographic.

I disagree. It makes no difference at all. What has really happened is that they lost the auction in an area in which they needed to win. This can change the entire direction of Android, or the company itself.

Whatever publicity they've gotten out of this is neutral. It doesn't matter. It won't help Google one bit. This is hardball, it doesn't matter if a few geeks are clapping their grimy hands.
post #195 of 300
Quote:
Originally Posted by cloudgazer View Post

I doubt Google is going to do any such thing. Apple got pre-cleared to buy the patents and Google has notably not itself engaged in litigation with Apple, and vice versa. The Apple v Google story is great copy and it gets lots of page hits, but it's not cut and dried - not the way that Apple v MS was back in the 90s.

If anybody is going to complain about this it won't be Google, it will be Samsung.

I don't see as how Samsung can complain. They didn't express an opinion about this before the auction. They didn't attempt to stop the auction, and they didn't think it important enough to participate.

What leg could they possibly stand on?
post #196 of 300
Quote:
Originally Posted by cloudgazer View Post

There was a really interesting discussion a while back on an Apple related podcast, I think build&analyze, where they talked about Facebook and Amazon going out of their way to try to win over geeks. Geeks opinion mattered, partly because geeks are opinion formers who influence non-geeks but also because geeks are your target market for recruitment.

Google absolutely cares about it's perception amongst geeks. Why else do you think they release high production value videos about their seawater cooling system in a datacentre?



Ok so if bidding is really so simple then you also disagreed with Solipsism



Either participants do attempt to gauge their competitor's interest from their bidding strategy or they don't, which is it? Either Google's approach was significant in some game theoretic way, or it was harmless. But certainly you can't believe it was bad for Google.

The publicity is bad as well as good. At least as many people are saying Google is nuts, as are saying that they're cool. It cancels out.

Anyway, as i said earlier, it doesn't matter anyway. Those who love Google already have their products, so this won't add to Google's coffers.

What matters here, is whether Google will be restrained in what they may be able to do, and whether their OEMs will have to pay even more fees, which will either lower their profitability, or cause them to raise prices, which may lower sales. It could also cause smaller players to drop out of the Android market, or not jump in.

That is what matters.

As far as the bidding goes. I don't think that anyone was thinking too hard about trying to get anything cheaply. They all had some limit to what they could afford to pay, and they likely went to that limit before joining another group.

This is an area in which you are looking at something so vital to your interests, that trying to get it as cheaply as possible isn't the situation. Your concern is whether you can afford it at all.

Remember that this went for about three times as much as was expected. That says that they weren't worrying about getting it as cheaply as possible. Several companies have pockets that are too deep for that to have been a concern.
post #197 of 300
Quote:
Originally Posted by stelligent View Post

Silly! When the bidding was lower than $3B, they were able to bid, in increasing order, Brun's constant, Meissel–Mertens constant and e. Obviously, they were able to go past $3B with a $3.14159 ... bid. But, once past $4B? Well, they did bid the Feigenbaum constant. Unfortunately for them, this proved to be confusing. You see - the first Feigenbaum constant is 4.6692..., the 2nd Feigenbaum constant is 2.5029 ... The auctioneer thought of the second one only and declared Apple the winner.

You're welcome.

Okay! Finally... somebody is making sense and can explain what the hell happened!

... and now Apple should buy MotoMobile... but I doubt the gov would let that happen after Apple winning the Nortel patent auction.
Hmmmmmm...
Reply
Hmmmmmm...
Reply
post #198 of 300
Quote:
Originally Posted by mdriftmeyer View Post

I don't agree with their idea.

It's a crock of crap. They were given tax free through loop holes to off-shore it and instead of paying the 35% to bring it back in they want to cut it down to 5%.

They can grow up and realize the lowest the US should allow it back in for is 20%.

And yes the Government is concerned which is the reason they rejected the 5% offer.

We're talking about slightly different things.

First of all that income does get taxed overseas. At what rate depends on the country, and the deals the companies have with them.

The government isn't concerned about the money earned overseas remaining overseas. That was what I was saying. I expected the government to reject the offer, especially these days. If the economy was better, and everyone wasn't so concerned about taxes, I'd bet that the government would have been friendlier to the idea. But right now, it's a political football.
post #199 of 300
Quote:
Originally Posted by stelligent View Post

Silly! When the bidding was lower than $3B, they were able to bid, in increasing order, Brun's constant, MeisselMertens constant and e. Obviously, they were able to go past $3B with a $3.14159 ... bid. But, once past $4B? Well, they did bid the Feigenbaum constant. Unfortunately for them, this proved to be confusing. You see - the first Feigenbaum constant is 4.6692..., the 2nd Feigenbaum constant is 2.5029 ... The auctioneer thought of the second one only and declared Apple the winner.

You're welcome.

Funny, but you should quote the source, don't you think? http://bit.ly/j09zLB
post #200 of 300
Quote:
Originally Posted by cloudgazer View Post

I did read it - you missed the key point. Solipsism is absolutely right when he said that part of the point for Google is to make competitors overpay. Yes Google didn't need the patents for itself but it could easily easily afford more than 4.5billion. So if there was 'no doubt that Apple was gonna win' Google should have kept bidding, because no doubt Apple would have outbid them.

If you were correct Google had a riskless way to damage Apple's business, on the other hand if you were wrong as I contend then it was all much more complicated than that. Google was either bidding to drive the price up for Apple, or bidding to win but hoping that Apple would think it was trying to drive up the price. If the former then Google wants to push Apple right up to its limit, if the latter then Google wants Apple to think that it's doing the former and that the price is already over the value to Google.

So I stand by my point, if you really think that Apple was 100% certain to walk away with the patents, then you are crazy and have no understanding of auctions. Because as Apple themselves would be aware, at a certain price that would constitute losing.

Apple could afford far more than Google if they needed to, as Apple makes vastly more from their iOS products and sidelines than Google can ever hope to make of the small licensing revenue for Maps and such, plus the Ad revenue.

If I expect to make twenty times as much as you do, i can afford to spend more thn you can to insure i keep making twenty times as much.

Granted, there isn't a one to one ratio here, but it's just as important.

As we can see from the amount Apple is paying Nokia, patents are of vast importance. This can mean that Apple won't have to pay billions in licensing fees.
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