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Initial Apple, Google bids for Kodak patents much lower than expected

post #1 of 11
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Opening bids from two investor groups, one led by Apple the other by Google, for Kodak's digital imaging patents came in well below the company's estimates of $2.6 billion, meaning the bankrupt photography pioneer may not have much capital to work with once creditors take their share.

According to people familiar with the auction, Kodak received bids from the two groups worth between $150 million to $250 million for the auction set to take place on Wednesday, reports The Wall Street Journal.

It was reported in July that Apple is teaming up with Microsoft and patent firm Intellectual Ventures to bid against a group comprised of industry heavyweights Google, Samsung, HTC, LG and patent holdings company RTX, for Kodak's digital imaging patents.

While the initial bids may be on the low side, subsequent sparring between the two groups is likely to raise the price substantially. In a previous bankruptcy auction over Nortel patents, Google started the proceedings with a $900 million bid but was ultimately beaten by a $4.5 billion offer from a consortium led by Apple and Microsoft.

According to one source, any bid over $600 million would be seen as "healthy" for Kodak's portfolio. Other people familiar with the process point out bidders don't expect the auction to raise more than that amount.

Kodak has fought to keep the bankruptcy auction out of the public eye, with a judge ordering the bidders, bids and final price all be kept secret until a winner is decided on Aug. 13.

"The auction process, including information about bids and the identity of bidders, is confidential pursuant to an order of the Bankruptcy Court," said a Kodak spokesperson. "Disclosure of submitted bids or the identity of bidders would violate the court's order, and Kodak believes that speculation about the details and potential outcome of the auction is inappropriate."

Kodak


Kodak's 1,100 patents up for auction are being split into two separate lots: one relating to the capture and processing of digital images; and one relating to storage and analysis of digital images.

The photography giant is looking to use the money gained from the patent auction to pay off $950 million in loans and complete a corporate restructuring that would see the company emerge from bankruptcy as a printer maker.

Confusing the sell-off, however, are allegations from Kodak saying Apple is trying to interfere with the auction by claiming rights to ten of the patents up for sale. The Cupertino company asserts the two companies co-developed the technologies in question during work on the QuickTake digital camera. Kodak filed suit to keep the patent auction moving and recently won a ruling that denied Apple's request to transfer the case out of bankruptcy court. Most recently, Apple was denied ownership of two of the ten patent claims.
post #2 of 11

If for some bizarre reason Apple were to lose in their case against Samsung (and I don't think they will lose) then building up patent troves to keep competitors at bay would be essentially useless. Patent law would be toothless.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #3 of 11
Quote:
Originally Posted by AppleInsider View Post

It was reported in July that Apple is teaming up with Microsoft and patent firm Intellectual Ventures to bid against a group comprised of industry heavyweights Google, Samsung, HTC, LG and patent holdings company RTX, for Kodak's digital imaging patents.


How funny... Apple / Microsoft - the ones that actually try inventing stuff, and then there's everyone else chummed in the same pot (the copycat artists).

I predict that Google and the rest of the scam artists, knowing they will lose, will simply raise the bidding price so high that Apple/MSFT will end up overpaying for it rather than letting it fall into the hands of these crooks.

post #4 of 11
Quote:
Originally Posted by SpamSandwich View Post

If for some bizarre reason Apple were to lose in their case against Samsung (and I don't think they will lose) then building up patent troves to keep competitors at bay would be essentially useless. Patent law would be toothless.

Microsoft is doing well with their patents with android. Oracle has not
post #5 of 11
Quote:
Originally Posted by sflocal View Post


How funny... Apple / Microsoft - the ones that actually try inventing stuff, and then there's everyone else chummed in the same pot (the copycat artists).


I predict that Google and the rest of the scam artists, knowing they will lose, will simply raise the bidding price so high that Apple/MSFT will end up overpaying for it rather than letting it fall into the hands of these crooks.

I predict both Apple and Samsung will continue to grow in the next year or so
post #6 of 11
It's not surprising that the bids are low. After all, the ownership of at least some of the patents is still in question. Insisting on the auction before the ownership issue can be settled is probably a mistake (unless Kodak thinks they'll lose the ownership issue - in which case it might make sense to take what they can get).
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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post #7 of 11
If this on eBay it will start at 99 cents. No surprise here starting with a low figure.
post #8 of 11
A year ago Kodak's market cap was something in the order of $80-100,000 million. If these patents are so valuable, somebody could have made a generous offer then and got not only the patents, but the Kodak brand as well, or what's left of it. Apple could have bought it and kept it a separate entity like Claris, and produced high quality consumer digital imaging products - cameras and printers, and re-evaluate all the other markets Kodak is in.
post #9 of 11
Quote:
Originally Posted by Stourque View Post

A year ago Kodak's market cap was something in the order of $80-100,000 million. If these patents are so valuable, somebody could have made a generous offer then and got not only the patents, but the Kodak brand as well, or what's left of it. Apple could have bought it and kept it a separate entity like Claris, and produced high quality consumer digital imaging products - cameras and printers, and re-evaluate all the other markets Kodak is in.

I think you mean '80-100 million'. It's been a long time (if ever) since Kodak was worth $100 B ($100,000 million).

The problem is that the market can be irrational. They've already received offers of up to $250 M for the patent portfolio when the entire company is valued at $250 M - and was previously valued at a lot less. I suspect that when the patents have been sold, someone is going to regret not buying up all of Kodak's stock, but, of course, that's only a guess. FWIW, I bought some Kodak stock because I think the patent portfolio will bring enough to make it a profitable investment.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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post #10 of 11
please, please, oh please Google et al. do not bid more than 950 million!... 250 million max, or if the going gets tough... 314.15264 million maximum. (PI x 100 million, LOL)

I would prefer Apple to own the patents...
(all gang together and dont bid more than 100 million PI...)
(probably illegal, but i think that KODAK needs get more than what it deserves)

or... if they absolutely need "the whole ball of wax" then pay 696.909967 million...(LOL) ( if my calculations are correct...)
(1100 patents... half that to get the radius... 550... then the volume of a sphere )
... 4/3 PI 550*cubed...
Edited by haar - 8/7/12 at 7:53am
post #11 of 11

today's Wall Street Journal is reporting that Apple and Google might join forces, along with others, to buy the Kodak patent portfolio. That would certainly be a twist.

melior diabolus quem scies
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melior diabolus quem scies
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