April 9, 2012, 10:45 am AOL-Microsoft Deal Shows Patent Frenzy Remains Strong By MICHAEL J. DE LA MERCED
The gold rush for patents continues.
The AOL $1.1 billion deal with Microsoft, involving the sale or licensing of more than 1,100 patents, highlights the technology world’s OBSESSION with intellectual property.
The last year alone has witnessed A NUMBER of high-priced transactions for intellectual property rights, from Google‘s $12.5 billion takeover of Motorola Mobility to a consortium’s purchase of 6,000 technologies from the bankrupt Nortel Networks for $4.5 billion. (Among the members of the Nortel consortium was Microsoft.)
Facebook is said to have purchased 750 patents from I.B.M. in recent months as well, according to Bloomberg News.
And Eastman Kodak is building much of its bankruptcy reorganization around the planned sale of its collection of 1,100 digital imaging patents. The company has estimated the value of that portfolio at up to $2.6 billion.
Some analysts and investors have speculated that Research in Motion, the beleaguered maker of BlackBerry devices, could fetch a high price for its intellectual property.
Such deal-making comes amid an arms race among the industry’s giants to protect themselves from competitors’ legal strikes — or to collect ammunition of their own. More than a dozen companies, including Apple, Samsung and Kodak, have filed patent infringement lawsuits and countersuits in the last 12 months over a wide array of technologies, from smartphones to social networking.
In one of the most prominent examples to date, Yahoo and Facebook have been embroiled in a big court fight that so far has been rare among Web companies. Each has claimed that the other has improperly used patents that cover technologies as basic as messaging and personalized content on Web pages. (Some of the patents that Facebook cites in its lawsuit were gained in recent purchases, possibly including the I.B.M. deal.)
Not all companies with bulging collections of intellectual property have been able to garner high prices, however. InterDigital called off an auction of its 20,000 wireless patents in January because of an inability to fetch a sufficient bid. The company is instead focused on selling off the portfolio in pieces or reaching licensing agreements.
And while many think RIM could command a king’s ransom for its smartphone and e-mail technologies, analysts at Jefferies speculated that the Canadian company might only receive $1 billion to $2.5 billion for the patents.
Still, AOL’s deal appears to have given investors hope that there is still plenty of money to be wrung from patents. Shares in InterDigital rose 3.3 percent, to $34.80, in midmorning trading on Monday. And shares in RIM jumped 4 percent, to $13.18.