Apple to Bid Against Google for Nortel Patents
While the U.S. Justice Department cleared Google (NASDAQ: GOOG) to bid for Nortel Networks' (NYSE:NT) $6,000-plus patents, last week, no one believed Google would get a shot at that wireless networking treasure trove uncontested.
The problem was, the rival bidders had yet to be revealed... until now. Google's top mobile rival Apple (NASDAQ:AAPL), chipmaker Intel (NASDAQ:INTC) and wireless power Ericsson all plan to vie for bankrupt Nortel's valuable technology, according to the Wall Street Journal.
In fact, interest was so high in the patent war chest -- Google is opening bidding at $900 million -- that Nortel said it has pushed back the auction by a full week, from June 20 to June 27.
Nortel Networks April 4 agreed to sell its remaining 6,000 4G LTE (Long Term Evolution) wireless, networking, social software and other patents to Google for $900 million in cash. However, as part of the "stalking horse" bid, the search engine is merely opening the bidding.
Google craves the patents, which Nortel said span "nearly every aspect of telecommunications and additional markets as well, including Internet search and social networking," to stave off increasingly rampant patent litigation.
Google is especially patent poor compared to older, larger companies, a fact Kent Walker, senior vice president and general counsel, noted in a blog post in April:
"One of a company's best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio, as this helps maintain your freedom to develop new products and services."
Bidding rivals Apple, Intel and Ericsson are certainly older companies with plenty of patents. RPX, which buys patents for other companies to stop them from being used against them, is also part of the mix.
Struggling phone maker Research in Motion (NYSE:RIMM) had also been rumored to be interested in the patents, whose technology is already used in the Blackberrys smartphones, as well as in Apple's iPhone.
The Journal had earlier indicated the DOJ expressed concern about Apple as a bidder for the patents. Apple has been lawsuit happy -- targeting HTC, Samsung and others -- as it seeks to defend its iOS software of late.
The DOJ does not want to arm Apple, or anyone else it believes won't be acting in the best interest of a fair market, with more technology it can use to stunt innovation from rivals.