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

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  • Reply 241 of 303
    stelligentstelligent Posts: 2,680member
    The argument that Goog might have gaming Aapl to bid more than necessary is intriguing, plaausible and insightful; however, if this was truly their strategy, it was flawed. First, they didn't know Apple's limit and could have ended up gaming themselves. Sure, this could've been a high stake game of chicken, but the ensuing argument would make it unlikely. Even if Apple were to pay the entire $4.5B, it would've done effectively zero long term damage to them. Therefore, the game was all for naught, which I'm sure didn't not escape the sharp minds at the Googleplex. In the mind, I think they were simply defeated by the Feigenbaum misunderstanding.
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  • Reply 242 of 303
    stelligentstelligent Posts: 2,680member
    As for Monty Hall, again an interesting but mixed metaphor. The Monty Hall problem trips up many because they miscount the number of possible eventualities. Here, everyone is simply guessing what machinations were at play. Perhaps none at all. In this guessing game, there's no way of counting all possible outcomes to maximize our odds of being vcorrect.
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  • Reply 243 of 303
    island hermitisland hermit Posts: 6,217member
    Quote:
    Originally Posted by stelligent View Post


    Therefore, the game was all for naught, which I'm sure didn't not escape the sharp minds at the Googleplex. In the mind, I think they were simply defeated by the Feigenbaum misunderstanding.



    Google was defeated by a fig tree??!! What the hell!
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  • Reply 244 of 303
    cloudgazercloudgazer Posts: 2,161member
    Quote:
    Originally Posted by stelligent View Post


    The argument that Goog might have gaming Aapl to bid more than necessary is intriguing, plaausible and insightful; however, if this was truly their strategy, it was flawed. First, they didn't know Apple's limit and could have ended up gaming themselves.



    Heh - if you believe the other people on this forum Apple didn't have a limit But over here in sanity land of course you're right. Which I would say is why Google stopped at 4billion, they clearly have the money to go higher, but pushing Apple much higher would risk actually winning. They wouldn't have known Apple's exact limit, but that's all part of the fun. I really don't think Google wanted to win these Patents, using them to protect their Licensees would have required a ton of litigation, and Google doesn't see itself that way.



    Quote:

    Sure, this could've been a high stake game of chicken, but the ensuing argument would make it unlikely. Even if Apple were to pay the entire $4.5B, it would've done effectively zero long term damage to them. Therefore, the game was all for naught, which I'm sure didn't not escape the sharp minds at the Googleplex.



    Earlier I got accused of telling a 'just so story', I wasn't then but I am now. The following theory is entirely speculative and intended to be read with an ISO certified tin foil hat.



    <Genuinely Crazy speculation>

    Google knew these patents were coming onto the market, they knew that Apple were bidding and they had two choices, bid or don't bid. Not bidding would send a message that they were completely unserious about Android. OEMs might go running to WP7 - so Google has to bid.



    Problem for Google is that they really are completely unserious about Android, and they have no desire to spend several billion on it -especially as recouping the money would require them to sue Nokia et al for licensing fees and Google doesn't do IP lawsuits as the plaintiff - it's bad PR. So Google has to bid, but lose.



    Problem is losing is bad PR too, and if they drop out too early they'll reap that bad PR and still look unserious about Android. Solution, bid the patents up to a much higher amount than initial expectations, but not so high that Apple will drop out.




    Oh and bid in funny amounts, to remind people that while you're a big company, you're a fun big company, so tweak the noses of the suits while winning plaudits from your fanboyz and shoring up morale inside the chocolate factory.

    </Genuinely Crazy speculation>



    Quote:

    In the mind, I think they were simply defeated by the Feigenbaum misunderstanding.



    That works too
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  • Reply 245 of 303
    cloudgazercloudgazer Posts: 2,161member
    Quote:
    Originally Posted by stelligent View Post


    As for Monty Hall, again an interesting but mixed metaphor. The Monty Hall problem trips up many because they miscount the number of possible eventualities. Here, everyone is simply guessing what machinations were at play. Perhaps none at all. In this guessing game, there's no way of counting all possible outcomes to maximize our odds of being vcorrect.



    My point regarding the MHP isn't so much what error people make in that instance, or how you solve it properly - there are probably a number of ways of analyzing either of those, but just that homo sapiens seems to have some fundamental blind spots that are remarkably specific. The MHP is the cognitive equivalent of an optical illusion if you will.



    I'm certainly not suggesting that in this case it's the same blindspot, or nearly such a profound one, just a similar instance where people are incredibly certain of something plausibly wrong.
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  • Reply 246 of 303
    ankleskaterankleskater Posts: 1,287member
    Quote:
    Originally Posted by stelligent View Post


    I think they were simply defeated by the Feigenbaum misunderstanding.



    That was NOT your idea! http://bit.ly/j09zLB
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  • Reply 247 of 303
    anonymouseanonymouse Posts: 7,123member
    Quote:
    Originally Posted by cloudgazer View Post


    ... <Genuinely Crazy speculation>

    ...

    </Genuinely Crazy speculation>...



    It's only genuinely crazy compared to your previous posts due to its specificity. Sanity land is not where you are.
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  • Reply 248 of 303
    jetzjetz Posts: 1,293member
    Quote:
    Originally Posted by Splash-reverse View Post


    I bid through eBay regularly and%2



    I'm pretty sure they bid Pi and Brun's constant just to have fun. It's quite likely they knew the direction the bid was going and what it was going to top out at. All the "fun" numbers they bid were well below their max bid. They knew they were going to approach max bid and just had fun before getting there. Nothing wrong with that. I really don't see why people have a problem with that.
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  • Reply 249 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by cloudgazer View Post


    Does your company have a single competitor in its market and exist in an essentially zero sum context? ie. are you motivated to help them fail at least in this market? I'm guessing not, since that's really quite uncommon.



    There are a number of competitors to Google here, as we saw from those bidding. Microsoft is a competitor, and RIm is a competitor. Do you think otherwise? In addition, Nokia will benefit from MS taking the winning side.



    Zero sum context? What does that mean?
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  • Reply 250 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by cloudgazer View Post


    Heh - if you believe the other people on this forum Apple didn't have a limit But over here in sanity land of course you're right. Which I would say is why Google stopped at 4billion, they clearly have the money to go higher, but pushing Apple much higher would risk actually winning. They wouldn't have known Apple's exact limit, but that's all part of the fun. I really don't think Google wanted to win these Patents, using them to protect their Licensees would have required a ton of litigation, and Google doesn't see itself that way.







    Earlier I got accused of telling a 'just so story', I wasn't then but I am now. The following theory is entirely speculative and intended to be read with an ISO certified tin foil hat.



    <Genuinely Crazy speculation>

    Google knew these patents were coming onto the market, they knew that Apple were bidding and they had two choices, bid or don't bid. Not bidding would send a message that they were completely unserious about Android. OEMs might go running to WP7 - so Google has to bid.



    Problem for Google is that they really are completely unserious about Android, and they have no desire to spend several billion on it -especially as recouping the money would require them to sue Nokia et al for licensing fees and Google doesn't do IP lawsuits as the plaintiff - it's bad PR. So Google has to bid, but lose.



    Problem is losing is bad PR too, and if they drop out too early they'll reap that bad PR and still look unserious about Android. Solution, bid the patents up to a much higher amount than initial expectations, but not so high that Apple will drop out.




    Oh and bid in funny amounts, to remind people that while you're a big company, you're a fun big company, so tweak the noses of the suits while winning plaudits from your fanboyz and shoring up morale inside the chocolate factory.

    </Genuinely Crazy speculation>







    That works too



    Interesting hypothesis. By the way no one here thinks that Apples' bids had no limit, and I'm pretty sure you know that.



    As for them not caring about Android. They care, but perhaps not enough.



    This is a pretty good idea of what was going on, and the problems for Google as a result:



    http://www.informationweek.com/news/...ogle/231000901



    Since Google wants a phone, and now tablet OS because they're afraid of losing direct views to its search engine, where it makes almost all of its sales and profits, if Android dies a slow death because of litigation, this could severely hurt Google over the long term. But maybe they've changed their minds about that.
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  • Reply 251 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by Jetz View Post


    I'm pretty sure they bid Pi and Brun's constant just to have fun. It's quite likely they knew the direction the bid was going and what it was going to top out at. All the "fun" numbers they bid were well below their max bid. They knew they were going to approach max bid and just had fun before getting there. Nothing wrong with that. I really don't see why people have a problem with that.



    Hey, I don't think that anyone here wants to deprive those kids of their fun, you know?



    But Google is a multi billion dollar business, and their business partners may think differently.
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  • Reply 252 of 303
    stelligentstelligent Posts: 2,680member
    Quote:
    Originally Posted by melgross View Post


    Interesting hypothesis. By the way no one here thinks that Apples' bids had no limit, and I'm pretty sure you know that.



    As for them not caring about Android. They care, but perhaps not enough.



    This is a pretty good idea of what was going on, and the problems for Google as a result:



    http://www.informationweek.com/news/...ogle/231000901



    Since Google wants a phone, and now tablet OS because they're afraid of losing direct views to its search engine, where it makes almost all of its sales and profits, if Android dies a slow death because of litigation, this could severely hurt Google over the long term. But maybe they've changed their minds about that.



    How in the world can any outside surmise whether Google cares or not, and how much, about anything.



    As for the Information Week link giving a good idea of what was going on - actually, the article gives zero idea of what was going on during the auction. It is a compendium of some quotes, speculations and ... speculations by bloggers. LOLOLOLOLOL!
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  • Reply 253 of 303
    stelligentstelligent Posts: 2,680member
    Quote:
    Originally Posted by melgross View Post


    Hey, I don't think that anyone here wants to deprive those kids of their fun, you know?



    But Google is a multi billion dollar business, and their business partners may think differently.



    Anyone who has truly followed Google, including its partners, knows their affinity for math. The recruitment process involves solving challenging mathematical problems. The company is named after a number. Why would anyone denigrate the company or its future prospects based on this is beyond comprehension. After all, what is so "professional" about bidding exaactly $3B, or $4.5B? And do business partners and developers stay away from Apple because Steve Jobs never changes his shirt?



    This is such a case of much ado about nothing. To rationalize this to this extent is frankly, really dumb.
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  • Reply 254 of 303
    cloudgazercloudgazer Posts: 2,161member
    Quote:
    Originally Posted by melgross View Post


    Zero sum context? What does that mean?



    A zero sum game is one in which your gain is directly a competitors loss, something like Poker, or a derivative contract. But how do we apply it to a larger context like a market?



    Back in the 80s Apple & MS were in a loose zero sum game, only one could come out the winner on the desktop market. Anything that made life harder for MS was good for Apple, even if it didn't directly improve Apple's position.



    At some point MS won that game, and then the context changed, though it took a while for either of them to realize it. In the new context Apple's survival helped MS because it gave them protection from the FTC, in the new context Apple had absolutely no hope of reaching a tipping point so there was no material benefit to them in damaging MS.



    I'm saying that Android/iOS is much more like Windows/Mac circa 1990 than circa 2005.
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  • Reply 255 of 303
    john.bjohn.b Posts: 2,742member
    Quote:
    Originally Posted by stelligent View Post


    Anyone who has truly followed Google, including its partners, knows their affinity for math. The recruitment process involves solving challenging mathematical problems. The company is named after a number. Why would anyone denigrate the company or its future prospects based on this is beyond comprehension. After all, what is so "professional" about bidding exaactly $3B, or $4.5B? And do business partners and developers stay away from Apple because Steve Jobs never changes his shirt?



    This is such a case of much ado about nothing. To rationalize this to this extent is frankly, really dumb.



    I think people are reacting to the possibility of Google reverting back to the days when there were "no grownups running the company" (their words, not mine). It's the kind of thing that makes investors nervous.
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  • Reply 256 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by stelligent View Post


    How in the world can any outside surmise whether Google cares or not, and how much, about anything.



    As for the Information Week link giving a good idea of what was going on - actually, the article gives zero idea of what was going on during the auction. It is a compendium of some quotes, speculations and ... speculations by bloggers. LOLOLOLOLOL!



    We don't KNOW, in that sense. But we can suspect that their commitment isn't as much as it could be. Those in the industry have been reporting that Google's OEMs are restive over this.



    But I can't just blame Google for losing the bid. Where was Samsung, soon to be the worlds largest phone maker? Where was LG, number three, and likely soon to be number two? Where was HTC, on of the largest Android manufacturers? what about Motorola?



    All of those companies could have been in on the bidding on Google's side, and together, they could have doubled the groups cash. And why wasn't Sony on their side, and Erricson, both phone manufacturers?



    Something isn't right in the land of Google.
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  • Reply 257 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by stelligent View Post


    Anyone who has truly followed Google, including its partners, knows their affinity for math. The recruitment process involves solving challenging mathematical problems. The company is named after a number. Why would anyone denigrate the company or its future prospects based on this is beyond comprehension. After all, what is so "professional" about bidding exaactly $3B, or $4.5B? And do business partners and developers stay away from Apple because Steve Jobs never changes his shirt?



    This is such a case of much ado about nothing. To rationalize this to this extent is frankly, really dumb.



    I'm not impressed with their math. I took two years of calculous and four years of physics, but I would never bid in such a man nor, no do I know anyone else who would. If they're trying to prove some obscure point by doing so, it fell flat. It doesn't matter if a few goofballs in the blogosphere are jumping up and down with thrills. This is a hard business situation, and when you run a company, your in it to win what you can, and even up on everything else.



    So don't tell us how much you've "followed" them. It's irrelevant.
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  • Reply 258 of 303
    melgrossmelgross Posts: 33,717member
    Quote:
    Originally Posted by cloudgazer View Post


    A zero sum game is one in which your gain is directly a competitors loss, something like Poker, or a derivative contract. But how do we apply it to a larger context like a market?



    Back in the 80s Apple & MS were in a loose zero sum game, only one could come out the winner on the desktop market. Anything that made life harder for MS was good for Apple, even if it didn't directly improve Apple's position.



    At some point MS won that game, and then the context changed, though it took a while for either of them to realize it. In the new context Apple's survival helped MS because it gave them protection from the FTC, in the new context Apple had absolutely no hope of reaching a tipping point so there was no material benefit to them in damaging MS.



    I'm saying that Android/iOS is much more like Windows/Mac circa 1990 than circa 2005.



    I know what a zero sum game is. I just don't see how it applies to this. But it means that wins and losses cancel out. I don't see how that's happening here. This is a game that's not nearly over yet. So we might compare it to a war, and Apple's side won this battle. But in a wat, the side with the most arms, the most technology, AND the best strategy usually wins.



    There may be reverses along the way, but long term, the results can be very different. Remember, the North lost the battle of Bull Run. And the Allies lost France.
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  • Reply 259 of 303
    nhtnht Posts: 4,522member
    Quote:
    Originally Posted by melgross View Post


    I'm not impressed with their math. I took two years of calculous and four years of physics, but I would never bid in such a man nor, no do I know anyone else who would. If they're trying to prove some obscure point by doing so, it fell flat. It doesn't matter if a few goofballs in the blogosphere are jumping up and down with thrills. This is a hard business situation, and when you run a company, your in it to win what you can, and even up on everything else.



    So don't tell us how much you've "followed" them. It's irrelevant.



    Following a company and having insight into them isn't irrelevant if this is part of the corporate culture. People claim that for Apple all the time and bidding like that seems to be very much in Google's cultural DNA.



    That some folks have no sense of humor isn't Google's problem and there's no real difference between bidding 3.141592B and 3B (well other than the 142M if you would have won with 3B).
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  • Reply 260 of 303
    cloudgazercloudgazer Posts: 2,161member
    Quote:
    Originally Posted by melgross View Post


    I know what a zero sum game is. I just don't see how it applies to this.



    The most obvious way that it applies to this is perception. People are not reporting or discussing this purely as a win for Apple, they are also talking of this as a loss for Google - in fact I'd say they're PRIMARILY discussing this as a loss for Google.



    At the end of the day it comes down to this. You really think that when Sergei, Larry & Eric all sat down to discuss how they were going to bid on this high profile auction that at no time did they discuss whether to try to make Apple pay more than necessary if it became clear that Apple was going to outbid them. I think they almost certainly did.
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