Google Bids Nearly $1 Billion For Nortel Patent Portfolio

Google has bid $900 million (according to the Wall Street Journal) for an extensive patent portfolio owned by the now-bankrupt Canadian company Nortel Networks. The move is primarily defensive, as Google explains in a blog post:

The tech world has recently seen an explosion in patent litigation, often involving low-quality software patents, which threatens to stifle innovation. Some of these lawsuits have been filed by people or companies that have never actually created anything; others are motivated by a desire to block competing products or profit from the success of a rival’s new technology . . . So after a lot of thought, we’ve decided to bid for Nortel’s patent portfolio in the company’s bankruptcy auction. Today, Nortel selected our bid as the “stalking-horse bid,” which is the starting point against which others will bid prior to the auction. If successful, we hope this portfolio will not only create a disincentive for others to sue Google . . .

As a “stalking-horse bid” it represents the price floor. The patents might ultimately go for two or three times that amount.

Other companies potentially interested in the Nortel patents include BlackBerry maker RIM, chip-maker Qualcomm, Ericsson and RPX Corp, which is an organization that acquires patents and licenses them to members on highly favorable terms in exchange for annual fees. Members include Microsoft and Intel, among others. There are also probably other bidders out there.

Nortel has more than 5,300 awarded patents in the US and other countries, some of which cover key wireless and enterprise technologies. It’s quite a trove.

The Google calculation here is pay now to avoid exposure in potential future litigation. Other companies may have similar concerns but may also be interested in licensing revenue. How they value the patents could be different or greater than the value Google is placing on them.

Stock image from Shutterstock, used under license

Related Topics: Channel: Industry | Google: Legal | Legal: Patents | Top News

Sponsored


About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

Connect with the author via: Email | Twitter | Google+ | LinkedIn



SearchCap:

Get all the top search stories emailed daily!  

Share

Other ways to share:
 

Read before commenting! We welcome constructive comments and allow any that meet our common sense criteria. This means being respectful and polite to others. It means providing helpful information that contributes to a story or discussion. It means leaving links only that substantially add further to a discussion. Comments using foul language, being disrespectful to others or otherwise violating what we believe are common sense standards of discussion will be deleted. Comments may also be removed if they are posted from anonymous accounts. You can read more about our comments policy here.

Comments are closed.

Get Our News, Everywhere!

Daily Email:

Follow Search Engine Land on Twitter @sengineland Like Search Engine Land on Facebook Follow Search Engine Land on Google+ Get the Search Engine Land Feed Connect with Search Engine Land on LinkedIn Check out our Tumblr! See us on Pinterest

 
 

Click to watch SMX conference video

Join us at one of our SMX or MarTech events:

United States

Europe

Australia & China

Learn more about: SMX | MarTech


Free Daily Search News Recap!

SearchCap is a once-per-day newsletter update - sign up below and get the news delivered to you!

 


 

Search Engine Land Periodic Table of SEO Success Factors

Get Your Copy
Read The Full SEO Guide