Lenovo is buying thousands of mobile technology patents from NEC as it looks to expand its smartphone and tablet businesses.
Lenovo is purchasing more than 3,800 patent families from NEC that cover such mobile technologies as 3G and 4G LTE, as well as other technologies found in such devices as smartphones, according to officials. The move is part of Lenovo's overall PC Plus business strategy as the company—the world's top PC vendor—looks to extend its reach into other computing system spaces, from data center servers to mobile devices.
A series of patent legal battles over the past several years involving such vendors as Apple and Samsung have highlighted the need for companies in the mobile device space to hold a large portfolio of patents to protect themselves against infringement accusations.
"A strong patent portfolio is a key element for success in the smartphone business," Ira Blumberg, vice president of intellectual property (IP) at Lenovo, said in a statement. "This investment strengthens Lenovo's existing intellectual property portfolio. As Lenovo expands its mobile PC Plus business into new markets, this investment shows it is committed to having the IP we need for global success."
Lenovo was a strong tech vendor in its native China when it bought IBM's PC business in 2005 for $.125 billion, a move that the company has since parlayed to overtake Hewlett-Packard to become the world's top PC vendor. In January, Lenovo officials announced their intent to buy IBM's low-end x86 server business for $2.3 billion, and a week later said they were buying Motorola Mobility from Google for $2.9 billion.
Company officials have said their goal is to make Lenovo the top vendor in a range of computing markets, including commodity servers and smartphones.
Despite the money Lenovo will pay for IBM's server business and Motorola, company executives have said they still have the cash on hand to buy more tech vendors to fill out the portfolio.
"We will continue to use acquisitions as a means to grow," Lenovo CEO Yang Yuanqing told the Wall Street Journal in March. "Whenever there is a good opportunity, we will grasp it."
The company reiterated that point with the April 4 announcement of the NEC deal, with officials saying that they will continue adding to Lenovo's IP portfolio through both its own internal development as well as from outside sources. The NEC deal came weeks after Lenovo spent $100 million to buy 21 patent families from mobile technology vendor Unwired Planet. Those patents also cover 3G and LTE, as well as other mobile technologies.
This reportedly also isn't the first dealing Lenovo has had with NEC over mobile technology. News reports circulated last year that Lenovo was in talks with NEC to buy the Japanese tech giant's smartphone business. However, the talks reportedly stalled over debates among the companies over which would be the majority owner of a joint venture and its patents. According to reports, NEC officials considered shuttering the company's smartphone business or finding another partner other than Lenovo.